INCOME TAX ACT, 1961

Section 11

Charitable trust - Exemption under section 11 - Income from activities as trade, commerce or business already taxed in the hands of AOP of which assessee State Association was member -

Assessee-cricket association registered under section 12A, claimed exemption under section 11. AO took the view that activities of assessee, i.e., holding of matches, sale of match tickets, receipt from booking of corporate boxes by companies, receipt of IPL subvention from B, income from club facilities, receipt from sponsors, etc., were of commercial nature and hence assessee was not eligible for exemption under section 11 as it is hit by proviso to section 2(15). Held: Since BCCI was being treated by tax authorities as an 'AOP' only and payments made to State Associations as distribution of profits, hence, under the circumstances, these payments by BCCI to State Associations including assessee, having already been taxed at the hands of BCCI could not be taxed again in the hands of member of AOP, i.e., assessee State Association as it would amount to double taxation of the same amount. However, income received by assessee otherwise, except the club income, which had not been taxed at the hands of BCCI, would be assessed as per normal provisions of the Act after thorough examination.

REFERRED :

FAVOUR : Partly in assessee's favour.

A.Y. :

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