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TMI Blog2015 (9) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... (Exemptions) for de novo consideration. - Decided in favour of assessee for statistical purposes. - ITA No. 1641/Mds/2013 - - - Dated:- 17-7-2015 - Chandra Poojari, AM And Challa Nagendra Prasad, JM,JJ. For the Petitioner : Mr G Seetharaman, CA For the Respondent : Mr Pathlaveth Peerya, CIT JUDGMENT Per Challa Nagendra Prasad, JM. This appeal is filed by the assessee against the order of the Director of Income Tax (Exemptions), Chennai dated 31.05.2013 in denying registration under section 12AA of the Act. 2. Authorized Representative for the assessee submits that assessee is a society, registered under section 10 of Tamil Nadu Societies Registration Act, 1975, formed with objects of propagation of knowledge of science of orthopaedic speciality, to provide academic training programmes to upcoming orthopaedic surgeons, to conduct monthly clinical meeting, to organize CME programs for the postgraduates etc. The Authorized Representative submits that assessee society has applied for registration under section 12AA of the Act with the Director of Income Tax(Exemptions). However, the Director of Income Tax(Exemptions) by order dated 31.05.2013 denied registr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ration under section 12AA cannot be denied. 3. Departmental Representative vehemently supports the order of the Director of Income Tax(Exemptions) in denying registration under section 12AA of the Act. 4. Heard both sides. Perused order of the Director of Income Tax(Exemptions) and the decisions relied on. The assessee Madras Orthopaedic Society is formed with the following main objects: a) propagation of knowledge of the science of orthopaedic speciality. b) provide academic training programmes to upcoming orthopaedic surgeons c) Create a sense of harmony and healthy co-existence amongst orthopaedic surgeons within the jurisdiction of Madras Orthopaedic Society and Orthopaedic surgeons in general. d) To conduct monthly clinical meeting. e) To organize CME programs for the postgraduates f) To organize live surgeries and workshops g) To offer fellowships for deserving PGs Consultants h) To organize conference at city, State, National and international levels i) To do social welfare activities j) To public journals and news letters k) To have our own place for conduct of activities and also a library l) To organize camps for welfare and cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DIT (Exemptions) himself has admitted that such reference might be used by general public as well as professionals doing bank audit, tax audit, etc. These activities could only be considered as a part of on-going education of Chartered Accountants which, in turn, would necessarily help society to get better, well-equipped and skilled set of Chartered Accountants for maintaining audit quality. So, we cannot say that such activities were in the nature of trade, commerce or business, even if consider the activity done by the assessee as one for advancement of object of general public utility. In any case, assessee, in our opinion, was only doing educational activity and the substituted Section 2(15) of the Act which effectively added a proviso thereto, would not apply to the assessee since such proviso was applicable only with regard to charitable activities in the nature of advancement of object of general public utility. We are, therefore, of the opinion that the assessee was well entitled to approval under Section 80G of the Act. The order of ld. DIT (Exemptions) is quashed and he is directed to grant the assessee renewal of its approval under Section 80G of the Act as sought for. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Accounts, which, in turn, would necessarily help the society to get better, well-equipped and skilled set of Chartered Accountants for maintaining audit quality. With that finding, the Tribunal allowed the appeal and held that the assessee was entitled to approval under Section 80G of the Act. 5. On a challenge to the said order, Mr.T.Ravikumar, learned standing counsel for the Revenue, would submit that in terms of first proviso to Section 2(15) of the Incometax Act, in the event the activities of the trust involve the carrying on 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, it shall not be construed to be a charitable purpose. Hence, the assessee in question shall not fall within the definition of Section 2(15) of the Act. 6. We have considered the above submission. The provisions of Section 2(15) of the Income-tax Act, read as under: 2(15) charitable purpose includes relief of the poor, education, medical relief, (preservation of environment (including watersheds, forests and wildlife) and preservation of monuments or places or objects of artistic or historic inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aining audit quality. 9. In our opinion, such activities of the assessee-trust cannot be construed to be one of trade or commerce or business and it would only be a charitable in nature. Therefore, it cannot be held that the activities of the assessee-trust in publishing and selling books of professional interest, which are meant to be used as a reference material even by the general public as well as the professionals in respect of Bank Audit, Tax Audit, etc., cannot be construed to be one of commerce in nature. The finding of the Tribunal in this regard requires no interference. 10. That apart, under Section 12AA of the Income-tax Act, while considering the application, the Officer has to satisfy about the genuineness of activities of the trust or the institution and for that reason, he may also make such enquiries as he deem it necessary in that behalf. In the given case, there is nothing to doubt about the genuineness of the activities of the assessee-trust in question. 8. The facts in the present case are almost similar to that of the facts in The Chartered Accountants Study Circle which was formed for the benefit of professionals as well as students of Chartered Acc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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