INCOME TAX ACT, 1961

Section 2(15), Proviso, 11

Charitbale trust - Exemption undr section 11 - Applicability of proviso to section 2(15) - Receipt of revenue from test laboratory and consultancy charges against activities of providing laboratory test services and consultancy to State Road Transport Undertakings

Assessee-society was an apex coordinating body of all Nationalized State Road Transport Corporation working under the aegis of Ministry of Road Transport and Highways, GOI. It was established with main object of improving public transport system in the country and to assist its members State Transport Undertakings by providing automobile parts at most economical and competitive rates so that members could run its passenger buses at economical cost. Assessee claimed exemption under section 11. AO deneid assessee's claim on the ground that on account of receipt of revenue from test laboratory and consultancy charges against activities of providing laboratory test services and consultancy to State Road Transport Undertakings, proviso to section 2(15) got attracted to assessee's case.Held: Even if some fees was being charged by assessee association for providing laboratory test services and consultancy services in accordance with its charitable objects, the activities could not be held to be rendered in relation to any 'trade', 'commerce' or 'business' as such activities were undertaken by assessee association in furtherance'of its main objects which were undisputedly of charitable nature and not an activity of 'trade', 'commerce' or 'business' with main object of earning profit. Accordingly, no exemption could be disallowed by invoking proviso to section 2(15).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2012-13

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