9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (9) TMI 1523 - AT - Income TaxExemption u/s 11 - registration u/s 12AA denied - charitable activity u/s 2(15) or not? - HELD THAT - As decided in assessee's own case 2013 (3) TMI 823 - ITAT CHENNAI assessee is entitled for exemption u/s 11 12 and accordingly, allow the appeal of the assessee and further hold that the reference made by the AO to the Director of Income Tax (Exemptions) recommending cancellation of the registration under section 12AA(3) of the Act to be erroneous. It is pertinent to mention that the Tribunal has been persistently holding that the assessee society functions fall under the concept of mutuality and the activities embedded in the Memorandum of Association of the society are charitable. Further the decisions relied upon by the Revenue are not applicable to the facts of the relevant case before us. Therefore, we hereby direct the Revenue to delete the tax imposed on the assessee by withdrawing the benefit under section 11 12 - decided against revenue.
Issues:
Revenue's appeal against the orders of the Commissioner of Income Tax (Appeals) - 17, Chennai regarding the status of the assessee society as a mutual organization and charitable institution under section 12AA of the Act, and the application of circular no. 11/2008 dated 19.12.2008 issued by CBDT. Analysis: The crux of the issue in the appeals was whether the assessee society qualified as a mutual organization and charitable institution under section 12AA of the Act, and if the circular no. 11/2008 dated 19.12.2008 applied to their case. The Tribunal referred to a previous decision in the assessee's case for the assessment year 2009-10, where it was held in favor of the assessee. The Tribunal emphasized that the assessee society's activities were limited to importing raw materials for distribution among its members, falling under the principles of mutuality. The Tribunal also highlighted the relevance of the circular, which stated that entities restricted to contributions and participation of only their members would not be affected by the proviso to section 2(15) of the Act. The Tribunal concluded that the assessee was entitled to exemption under sections 11 and 12 of the Act, directing the Revenue to withdraw the tax imposed on the assessee. The Tribunal further reiterated that the activities of the assessee society aligned with the concept of mutuality and were charitable as per the Memorandum of Association. The Tribunal distinguished the decisions relied upon by the Revenue, emphasizing that they were not applicable to the facts of the case. Consequently, the Tribunal dismissed all three appeals of the Revenue, upholding the orders of the Commissioner of Income Tax (Appeals) for the relevant assessment years. In summary, the Tribunal upheld the assessee society's status as a mutual organization and charitable institution, citing previous decisions and the relevant circular. The Tribunal emphasized the principles of mutuality and charitable activities in the society's operations, leading to the dismissal of the Revenue's appeals and the withdrawal of imposed taxes on the assessee.
|
