| The Tax Publishers2020 TaxPub(DT) 2479 (Del-HC) INCOME TAX ACT, 1961
Section 11
Where Tribunal held that activities of assessee society in no way could be termed as trade and commerce, etc., as it was not charging any fee from beneficiaries, who belonged to poor communities and further NGOs like WHO, UNICEF etc., which engaged assessee, were themselves charitable instructions and they ensured that grants given were utilized for purpose of charitable activities, and not for any business, assessee was eligible for exemption under sections 11 and 12.
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Charitable trust - Exemption under section 11 - Activities of assessee, whether within scope of 'general public utility' - Grants received by assessee from NGOs like WHO, UNICEF, etc. whether utilized for purpose of charitable activities
Assessee-society was engaged in providing services of relief to poor, education and medical relief. Question arose for consideration as to whether activities of the assessee would fall within the scope of 'general public utility' under section 2(15) and therefore, it was entitled to exemption under sections 11 and 12. Held: Tribunal held that activities of assessee in no way could be termed as trade and commerce etc. as it was not charging any fee from beneficiaries, who belonged to poor communities. Tribunal also noted that NGOs like WHO, UNICEF etc. which engaged assessee, were themselves charitable instructions. They ensured that grants given to assessee were utilized for purpose of charitable activities, and not for any business. Consultants' fees were also paid out of such grants. Further, revenue was not able to show that any part of profits or gains was transferred to any member of assessee-society. Thus, no infirmity was there in order of Tribunal warranting interference.
Confirmed:Praxis Institute of Participatory Practices v. DIT (Exemption) (2015) 154 ITD 10 (Delhi-Trib) : 2015 TaxPub(DT) 0988 (Del-Trib)
REFERRED :
FAVOUR : In assessee's favour
A.Y. :
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