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TMI Blog2015 (10) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... in its charter. In the present case, out of a number of declared objects, the assessee trust may be pursuing only one or two viable objects and may advent upon other objects as and when the circumstances permit. Therefore, stating a large number of objects in the trust deed does not disentitle the assessee from claiming the status of a charitable trust. It is only sufficient to look into whether the actual activities carried on by the assessee trust are coming under any of the objects stated in its trust deed. We find that the first ground raised by the Director of Income-tax(Exemptions) may not be sustainable in law. Whether certain objects mentioned in the trust deed of the assessee, are of commercial in nature and, therefore could not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f charitable activities or not. The conclusion of the Director of Income-tax(Exemptions)is premature. The assessee trust is qualified for registration under sec.12AA - Decided in favour of assessee. - ITA No. 2104 /Mds/2013 - - - Dated:- 10-11-2014 - Dr. O.K.NARAYANAN AND SHRI VIKAS AWASTHY, JJ. For The Appellant : Shri N. Devanathan, Advocate For The Responden : Shri Anirudh Rai, IRS, CIT ORDER PER Dr.O.K.NARAYANAN, VICE-PRESIDENT This appeal is filed by the assessee. The assessee is a trust. It applied for registration under sec.12AA of the Income-tax Act, 1961, so as to secure the status of a charitable institution. The application for registration was filed on 1st February, 2013. The Director of Income-tax(Exemp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sec.2(15) of Income Tax Act, 1961. 4. The learned DIT(E) had failed to see that these objects were of general public utility and that there is no commercial element in such activities. The appellant respectfully submits that the above observations of learned DIT(E) are not at all warranted while considering application for registration u/s 12AA of the IT Act, 1961. 4. We heard Shri N. Devanathan, the learned counsel appearing for the assessee trust and Shri Anirudh Rai, the learned Commissioner of Income-tax appearing for the Revenue. 5. The application filed by the assessee trust has been rejected by the competent authority on two specific grounds. The first ground is that the declared objects of the assessee trust are innumerab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ities germane to the main set of objects of the company. This is usually practiced in trust deed as well. This is because changing times demand changes in priorities. The basic charter of a trust cannot be amended off and on. Therefore, in order to cope with the priorities of the future it has to become necessary for trusts and such other institutions to state their objects in very many words encompassing all fields of charitable endeavours. It is not necessary that a trust should carry on all and every one of its stated objects. It is sufficient that a trust carries on selected number of objects stated in its charter. In the present case, out of a number of declared objects, the assessee trust may be pursuing only one or two viable objects ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trade, commerce or business, for a cess or fee or any other consideration, irrespective of the nature of use or application, or retention, of the income from such activities. In the present case, the object of the assessee trust is not to organize milk societies and run factories in the nature of trade, commerce or business. The crucial point to be looked into the objective is that those activities are proposed to be carried out for economic development of rural, poor women. The activities for the upliftment of rural women in India are generally considered as charitable in nature. In order to improve the economic conditions of poor people in villages, it is very necessary that the rural population must engage in some economic activities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en and exploitation, through the societies formed under the guidance of the assessee trust. This is the same case with other proposed activities like ginning, spinning, fruit processing etc., where labour of the village women-folk could be fruitfully deployed, to keep away exploitation. 10. The economic activities in the above nature cannot be treated as activities in the nature of trade, commerce or business as contemplated in proviso to sec.2(15). Therefore, we find that the Director of Income-tax(Exemptions) has characterized the activities of the assessee trust as commercial in nature without going into the circumstances in which the activities are contemplated to be carried on by the assessee trust. 11. The assessee trust has not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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