INCOME TAX ACT, 1961

Section 11

Charitable trust - Exemption under section 11 - Allegation that assessee was involved in commercial activity -

Assessee's main objects were to undertake and promote engineering, technical, economic, financial, managerial and statistical studies and research into matters relating to the planning, organization, management, operation maintenance and construction of ports and harbours and to provide a technical consultancy service. AO denied the exemption under section 11 claimed by assessee on the ground that assessee was involved in commercial activity and held that assessee's case falls under the last limb of the section 2(15). Held: Assessee in instant case was not engaged in any activity of trade, commerce or business so as to fall within the mischief of first proviso of section 2(15) was not controverted by Revenue. Hence, exemption under section 11 could not be denied to the assessee as it was not involved in any commercial activity so as to fall within the purview of 1st proviso to section 2(15).

Followed:CIT, New Delhi v. Federation of Indian Chambers of Commerce and Industry (1981) 130 ITR 186 (SC) : 1981 TaxPub(DT) 0941 (SC), Addl. CIT, Gujarat v. Surat Art Silk Cloth Manufacturers Association (& Ors. References) (1980) 121 ITR 1 (SC) : 1980 TaxPub(DT) 0848 (SC), CIT, Madras v. Andhra Chamber of Commerce (1965) 55 ITR 722 (SC) : 1965 TaxPub(DT) 0190 (SC), The CIT, Cochin v. Cochin Port Trust, Willington Island, Kochi-3 (2019) 411 ITR 467 (Kerala) : 2018 TaxPub(DT) 8129 (Ker-HC), CIT-I v. Kandla Port Trust (2014) 364 ITR 164 (Guj.) : 2014 TaxPub(DT) 2143 (Guj-HC)

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2012-13

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