9911796707
TMI Blog1999 (8) TMI 137X X X X Extracts X X X X X X X X Extracts X X X X ..... aid to the poor and needy sections of the society. It owns a building which is very old and this building is given on hire on various occasions at nominal rent. The building being very old needs regular maintenance and repairs and major portion of the income is from rent which is used for this purpose, thereby leaving a meager surplus every year. In spite of such meager surplus, the Trust carriers on its charitable activities by offering the building free of charge on various occasions such as blood donation camps, medical check-ups, gathering and meetings for study purposes etc. The objects of the trust are certainly charitable and this fact is not doubted by the Assessing Officer. The assessee is registered under Societies Registration A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 11(2). It was contended that there was no legal requirement of spending the income of the trust. It was further pointed out that the Assessing Officer had no reason to refer to assessment years 1984-85 to 1989-90 which where beyond the jurisdiction because in those years, exemption under section 11 was already allowed after proper scrutiny. It was also submitted before the CIT(A) that by letting out its Karyalaya the assessee-trust was not carrying on any business activity because the assessee does not carry on business of arranging marriage functions, providing catering service, providing musical amusement, refreshment etc. It merely lets out its premises, utensils and furniture and earns rental income. Reliance was also placed on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that the activities of letting out Mangal Karyalaya and deriving income therefrom was regular business activities and the excess of income over the expenditure is assessable as 'profit and gains of business or profession' and accordingly, the CIT (A) erred in holding that no business activities were carried on by the assessee. Shri K.A. Sathe, the learned counsel for the assessee strongly supported the order of the learned CIT(A). 5. We have considered the rival submissions and perused the facts on record. Ever since it was established in the year 1925, the trust has been letting its Mangal Karyalaya and utensils for providing functions besides doing other charitable acts like providing medical and educational aid to the poor and needy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or institution from being a valid charity. In this judgment, the judgment of the Supreme Court in the case of Dharmodayam Co. , CIT v. Cochin Chamber of Commerce Industry [1973] 87 ITR 83 (Ker.) and Andhra Pradesh State Road Transport Corpn. v. CIT [1975] 100 ITR 392 (AP) have been approved. The Hon'ble Bench of the Supreme Court consisting of five Judges presided over by P.N. Bhagwati, J. (as he then was) overruled its earlier judgment in the case of Indian Chamber of Commerce v. CIT [1975] 101 ITR 796 (SC). The Hon'ble Bench also disapproved the observations of Khanna and Gupta. JJ., in Sole Trustee, Loka Shikshana Trust v. CIT [1975] 101 ITR 234 (SC) and further approved the observations of Beg, J. in Sole Trustee, Loka Shikshana Trus ..... X X X X Extracts X X X X X X X X Extracts X X X X
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