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TMI Blog2018 (4) TMI 630X X X X Extracts X X X X X X X X Extracts X X X X ..... ominant activity or ancillary to it. Unless a close examination of this nature is done, in our opinion, a conclusion as to whether assessee was hit by the proviso to Section 2(15) of the Act cannot be reached. None of the lower authorities had done this analysis. In the circumstances, we are of the opinion that the matter requires a fresh look by the ld. Assessing Officer. - Decided in favour of revenue for statistical purpose. - I.T.A. Nos.3470 And 3471/CHNY/2016 - - - Dated:- 5-4-2018 - SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER For The Appellant : Shri. ARV Sreenivasan, JCIT. For The Respondent : Ms. S. Sriniranjani, Advocate ORDER PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER Grounds raised by the Revenue in these appeals which are directed against an order dated 01.09.2016 of ld. Commissioner of Income Tax (Appeals)-2, Madurai are reproduced hereunder:- 1. The order of the learned CIT(A) is contrary to the law and facts of the case. 2.1 The Id. CIT (A) erred in holding that the case of the assessee is not covered by the 1st proviso to Sec. 2 (15) of the I.T. Act and that provisions of Sec. 13(8) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... observe that the assessee is not eligible to claim exemption u/s 11 of the I.T. Act when the activities are attracted by the amended provisos to Section 2 (15) of the I.T. Act, even if the registration is not cancelled . 5 . For these and other grounds that may be adduced at the time of hearing, it is prayed that the order of the learned Commissioner of Income Tax (Appeals) may be set aside and that of the Assessing Officer may be restored. 2. Facts apropos are that assessee a society registered with the Registrar of Societies, Tamil Nadu and also having registration u/s.12A(a) of the Income Tax Act, 1961 (in short the Act ) had filed its return for the impugned assessment years declaring Nil income after claiming exemption u/s.11 12 of the Act. Assessee was conducting trade fairs, exhibitions etc. As per the assessee, it was carrying on activities in the nature of general public utility and hence a charitable organization. For claiming exemption under Sections 11 12 of the Act, assessee had placed reliance on the definition of Charitable purpose u/s.2(15) of the Act. 3. Ld. Assessing Officer during the course of assessment proceedings noted that assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered as an organization doing any charitable activity in view of the proviso to Section 2(15) of the Act. Relying on Section 13(8) of the Act, ld. Assessing Officer denied exemption claimed by the assessee u/s.11 12 of the Act. 4. Aggrieved, assessee moved in appeal before the ld. Commissioner of Income Tax (Appeals). Argument of the assessee before ld. Commissioner of Income Tax (Appeals) was that its activities, which were in the nature of conducting exhibitions under the names Ideal Home Exhibition, Print n Pack, Indexpo and Ayush could not be considered as any commercial activity. As per the assessee, these were all part of its Business Information Centre (BIC) catering to the needs of budding entrepreneurs. Contention of the assessee was that exhibitions were conducted with a specific intention of promoting trade and commerce, industrialization, promotion of printing technology, promotion of traditional medicines etc., As per the assessee, its intention was promoting micro and small scale industries in and around Madurai. Reliance was placed on the judgments of Hon ble Delhi High Court in the case of India Trade Promotion Organization vs. Director General IT (Exemptions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e rival contentions and perused the orders of the authorities below. Objects of the assessee as per its trust deed are as under:- i) To promote and protect the Micro and Small Enterprises in Madurai District. ii) To take all steps to protect and promote the general interests of the persons engaged in Micro and Small Enterprises in Madurai District. iii) To consider and formulate opinions upon all matters connected with the Micro and Small Enterprises in Madurai District. iv) To collect, classify and circulate statistics and other information relating to commercial interests in general Micro and Small Enterprises in particular. v) To promote beneficial and other measures relating to the Micro and Small Enterprises and thus obtain by all acknowledged means the redressal of grievances of the industrialist in Micro and Small Enterprises. vi) To maintain a library of books and publications and literature on Micro and Small Enterprises, so as to diffuse commercial information and knowledge amongst the members of the Association . Its income and expenditure accounts for the years as on 31.03.2010 and 31.03.2011 read as under:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eceivables as on 31.03.2011 came to G33.86 lakhs and cash at bank was G19.95 lakhs. In our opinion the question that ought have been addressed by the ld. Assessing Officer was whether the activities of the assessee as reflected in its income and expenditure accounts and its statement of affairs as reflected in the Balance Sheets, would show what was the dominant activity of the assessee. Ld. Assessing Officer ought have identified the dominant activity of the assessee and verified whether such activity was in line with its objects and whether income earned through stalls, seminars, conferences, entrance fees etc were part of such dominant activity or ancillary to it. Unless a close examination of this nature is done, in our opinion, a conclusion as to whether assessee was hit by the proviso to Section 2(15) of the Act cannot be reached. None of the lower authorities had done this analysis. In the circumstances, we are of the opinion that the matter requires a fresh look by the ld. Assessing Officer. We set aside the orders of the authorities below and remit the question whether assessee was eligible for claiming exemption u/s.11 and 12 of the Act back to the file of ld. Assessing O ..... X X X X Extracts X X X X X X X X Extracts X X X X
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