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TMI Blog2015 (3) TMI 445X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenditure during the year. The books of account clearly show that no amount of current receipt or out of unutilized receipt of the past has been treated as profit in the sense it would be treated, had it been a business and that no amount has ever been given to any member of the board of the society or any member of the assessee society except the reimbursement of expenses incurred in connection with the board’s meeting. It is also not the case of the department that any part of profit or gain shown as receipt over expenditure has been transferred to any member of the society. Thus, the activity of the assessee society is certainly not for making profit and it is certainly not in the nature of any trade, business or commerce, so as to be headed by the first proviso to sec. 2(15) of the Act even if it is treated as advancement of any general public utility. The activities as discussed hereinabove of the present assessee cannot be held to be engaged in the activity of advancement of any other object of general public utility. The activities carried on by the assessee cannot be said to be beyond its main aims and objects and it is also an undisputed fact that the assessee society ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l/2012. 4. In ITA No.5583/Del/2011, the assessee has questioned rejection of request of the assessee for continuation of approval granted under section 80G(5)(vi) of the Act by the learned DIT(E). 5. In support of the grounds raised in the appeals, the learned AR submitted that the assessee society is registered under the Society Registration Act, 1861 vide order dated 14.8.1997 and also under section 12A of the Income-tax Act, 1961 vide order dated 10.3.1999 passed by the DIT(E). He submitted that the registration granted under sec. 12A of the Act is still valid. The society has been getting approval under sec. 80G regularly which was being renewed from time to time. The last renewal was made by DIT(E) vide his order dated 25.09.2008 valid for the period 01.04.2008 till 31.3.2011. The registration continues to remain valid till date in view of the amendment in the Act and as per clarification vide CBDT Circular dated 27.10.2010 according to which existing approval under section 80G(50(vi), validity of which is expiring on or after 1st October 2009 shall be deemed to have been extended in perpetuity unless specifically withdrawn by DIT (E). 6. The learned AR submitted furt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions laid down in sec. 2(15) before amendment and after amendment. He reiterated that all the activities of the assessee clearly fall in the first three limbs of charitable purposes as defined in sec. 2(15) of the Act, namely, relief of the poor, education, medical relief. In this regard, he referred page Nos. 60 to 68 of the paper book as well as copy of arrangement between the assessee and NGOs who have engaged the assessee describing the activities of the assessee. These evidences show the grants/donations/fees etc. received from various parties, its nature as per the agreement and its actual uses for relief of poor, for education/medical etc. From these documents, it will be seen that the assessee has been rendering charitable activities to destitute, orphans or the handicapped, disadvantageous women or children. The learned AR also referred CBDT circular No. 11/2008 dated 10/09.12.2008 making the position clear regarding proviso to sec. 2(15) of the Act. The learned AR submitted further that the activities carried on by the assessee have all along been accepted in the case of the assessee itself by the Revenue over the years. The Assessing Officer has denied the benefit o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpact. NACP III shares the same vision-it aspires that at least 50 percent of targeted interventions for highrisk groups will be implemented by community based organizations (CRO) by the end of NACP-III. b. The Leprosy Mission Trust India Over the last view years TLM has refocused its approach to working with people and communities affected by leprosy and disability. There has been a progressive shift away from providing welfare support to working with communities in participatory manner to address their social, economic and spiritual needs in a sustainable manner through building capacity and giving a voice to the marginalized. c. Plant International inc. a non-profit New York Corporation Child protection Policy: PLAN is committed to the actualizing of child rights and is obligated to provide children with whom it works a safe and conducive environment. Plan's Child Protection Policy (as attached as Annexure-ii) applies to its partner staff as much as it applies to its own staff Any violation of the code of conduct as described in the policy is considered by Plan a serious contempt to children and Plan reserves its right to intervene is such circumstances. d. UNICE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d under sec. 143(3) of the Act in the case of the assessee for the assessment years 2006-07, 2007-08 and 2008-09. 12. The learned AR submitted that the assessee is not charging any fee to any beneficiary and the beneficiary are poor community to whom the assessee is giving medical facilities, collecting and training drug addicted persons etc. 100% of assessee s receipts are for services rendered to societies/institution like Care India, UNICEF, Save the children, leprosy mission, CRY, Help page etc. whether in India or abroad which are engaged in charitable activities and as per their charter they are to involve only those institution/societies which are not in trade, commerce or business and are doing real work in providing relief to the poor, education, medical relief etc. The aforesaid societies/institutions are closely monitoring the activities of the assessee trust as to whether the assessee is rendering services in the nature of charity or not as it can be seen from the copy of the agreements with them made available in the paper book. Thus, without there being any change in the facts and circumstances of the case during the year under consideration, the Assessing Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing only consultancy job and was rendering services but other societies/institution by charging fee. In earlier year up to 2008-09, the claim of the assessee regarding exemption under sec. 11 of the Act was being accepted but during the year the claimed exemption was withdrawn due to change in law by way of insertion beyond of proviso to sec. 2(15) of the Act. Since the assessee is providing services with profit motive as it has been discussed by the authorities below, it falls in 6th Limb of the provisions. He submitted that the activities of the assessee are general public utility not for the benefit of the poor. 15. In rejoinder, the learned AR submitted that the ultimate beneficiary is definitely poor people. He drew our attention to the object clauses of the assessee made available at page nos. 1 and 2 of the paper book filed on 13.11.2014. The leaned AR submitted that of course the assessee is working for different societies/institutions engaged charitable works but it implements and executes their charitable object by organizing the camps etc. for the beneficiaries without charging anything from beneficiaries. The different societies/institutions pay to the assessee for o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cting therein online high and micro level planning for UNICEF, the task of the assessee involve fixing understanding the living condition of the tribal people and dynamics of their social exclusion (page No. 16 of the annual report contains the relevant activities and photographs depicting the immersional lending program). For international labour office (ILO), the task of the assessee is to carry out rapid assessment on the vulnerability of workers to bondages/labour exploitation in Tamilnadu by organizing separate works job/consultation meetings with employer, NGOs and government etc. Also to find out specific issues of women workers such as Child Care including sexual harassment/violence etc. Page No.12 of the annual report contains the relevant activities and photographs depicting the living and working condition of workers. 17. For Pellastakaa Laspset-Radda Banen(save the children, contract Finland), the assessee was entrusted to undertake the study on qualitative base line in eight village of southern Rajasthan for formulating an educational model for promoting and protecting the rights of children of indigenous community through a right based approach in the area of root ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on implementation of various medicine related to children invocation. This research was part of the research activities which were to be carried out by SAS, but SAS could not carry out. This research was carried out by the assessee society in pursuance of a written arrangement with SAS. As per the arrangement/agreement, the assessee provided techno-medical research support and compilation of DATA in a project called ROTA VIROS . In consideration thereafter, SAS agreed to pay the assessee a lump sum amount of ₹ 50 lacs. It was termed as service fee. The Assessing Officer construed the above said agreement to be a commercial agreement. The services provided by the assessee to SAS were taken as being of commercial nature. The Assessing Officer held that the proviso to sec. 2(15) of the Act is applicable to any other object of general public utility and not to charitable organization engaged in providing either relief to the poor or medical relief or education and that since the activities of the assessee did not fall under either relief to the poor or medical relief or education, it could be safely presumed that they fall under the category of general public utility , that f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onnecting/collecting the poor and needy people like destitute orphans, sex workers, drug addicts in which assessee society has gained experience over a period of time and has capacity to collect these particulars classes of people and motivate them to get out of it. Besides, there is no change in the activity of the assessee which all along has been covered under the first three limbs of charitable activities laid down under sec. 2(15) of the Act as in the assessment years for 2006-07, 207-08 and 2008-09 in the assessment framed under sec. 143(3), the activities of the assessee trust have been treated as charitable in nature and within the meaning of sec. 2(15) of the Act. As discussed above, the activities of the assessee firstly cannot be treated as advancement of any other object of general public utility nor it can be said that the activity of the assessee involves the carrying of any activity in the nature of trade, commerce or business or any activity of rendering any service in relation to any trade, commerce or business for a cess or fee or any other consideration. Respectfully following the above referred decisions on identical issues on almost similar facts as of the pres ..... X X X X Extracts X X X X X X X X Extracts X X X X
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