INCOME TAX ACT, 1961

Section 11 Section 2(15), Proviso

Charitable trust - Exemption under section 11 - Applicability of proviso to section 2(15) - Holding of exhibition by assessee engaged in promoting cooperation among promoters and builders association

Assessee was a registered trust engaged in activity of promoting and fostering feelings of unity and cooperation and mutual help and to eliminate unhealthy competition and unfair trade practices among Promoters and Builders Association of Pune. It claimed exemption under section 11. AO noticed that gross receipts of assessee included surplus from exhibition activity which, as per AO, were hit by proviso to section 2(15) and accordingly, AO held that assessee was not entitled to exemption under section 11. Held : Holding of exhibition by assessee trust was only in furtherance of charitable activity of trust wherein, healthy environment was provided for businessmen so that all the stake holders, i.e., businessmen and customers were benefited and they were also made aware of various activities like pollution control, city development and legal assistance, etc which were in the nature of charitable activities and these certainly reached out to greater number of people of society. It was not disputed that clause (vii) in Memorandum of Objects was one of the pertinent objects of assessee trust and fulfillment of such object benefited public at large by holding exhibition and therefore, was a part of charitable activity conducted by assessee-trust. Therefore, assessee was not hit by first proviso to section 2(15) and AO was directed to grant benefit of exemption under section 11.

Relied :Society of Indian Automobile Manufacturers v. ITO 2016 TaxPub(DT) 3298 (Del-Trib) : (2016) 71 taxmann.com 138 (Delhi-Trib), Asstt. CIT v. Mahratta Chamber of Commerce Industries and Agriculture in ITA No. 939 & 940/PUN/2013, Order, dated 8-9-2017

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2011-12 & 2012-13

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