2022 (5) TMI 1626 - HC - Income Tax

Exemption u/s 11 - activity of the assessee of letting out gallery frequently for a price - Whether qualify as being called in the nature of charity - Whether merely because a small percentage of the income of the Assessee is from letting out of its premises and sale of paintings the essential activity of the Assessee would not cease to be charitable for the purposes of Sections 11 and 12? As decided in ALL INDIA FINE ARTS CRAFTS SOCIETY NEW DELHI 2020 (6) TMI 603 - ITAT DELHI Proviso to Section 2(15) of the Act which was inserted by Finance Act 2008 was directed to prevent the unholy practice of pure trade commerce and business entities from masking their activities and portraying them in the garb of an activity in the object of a general public utility but was not designed to hit at those institutions which had the advancement of the objects of general public utility at their hearts and were charity institutions thus direct the AO to allow the assessee the benefit of exemption u/s 11 12 HELD THAT - Appellant fairly draws our attention to the order passed 2019 (8) TMI 1500 - DELHI HIGH COURT whereby the Revenue s appeal arising from the order 2019 (2) TMI 905 - ITAT DELHI in relation to the respondent-assessee for the assessment year 2009-10 was dismissed by this Court. The impugned order passed by the Tribunal relies on the earlier order 2019 (2) TMI 905 - ITAT DELHI in relation to the assessment year 2009-10. Since this Court has already held that no substantial question of law arises for the consideration of this Court we do not find any merit in the present appeal as well as in the application for condonation of delay and the same are dismissed.

Summary

The Delhi High Court dismissed the appeal challenging the order dated 26th February, 2020 for the Assessment Year 2012-13, citing a previous order related to the assessment year 2009-10. The Court found no substantial question of law and dismissed the appeal and the application for condonation of delay.