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TMI Blog2019 (6) TMI 1516X X X X Extracts X X X X X X X X Extracts X X X X ..... on u/s 12A to the assessee, exhibitions were organized by the assessee known as LEXPO during the year under consideration and income from Stalls rent and entry ticket charges was generated. There was also income generated by the assessee from sale of publication. In the return of income filed for the year under consideration, exemption under section 11 was claimed by the assessee for the said income but the said exemption was denied by the AO in the assessment completed under section 143(3) by relying on the proviso to section 2(15) as amended w.e.f. A.Y. 2009-10 as well as the provisions of section 28(iii) of the Act. Similar issue was involved in the case of Credai Bengal [ 2016 (11) TMI 600 - ITAT KOLKATA ] it was held by the Tribunal that where assessee s object of promotion of construction industry in India had been accepted by the Revenue for granting registration under section 12AA, merely because the assessee held fairs in India and abroad which generated surplus fund to the assessee, it being incidental to main object of the assessee could not be said to be commercial activity of the assessee and there was no violation of the provisions of section 2(15). Ratio of the decis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 activity. He also referred to section 28(iii) of the Act, which specifically provided that profits and gains of business or profession include income derived by a trade, professional or similar association from specific services provided for its members. He noted that the principal activity involved in organizing exhibitions by the assessee was running of the stalls and the assessee had not only charged from the occupier of the stalls but had also collected entry fees from the general public to visit the stalls. He held that the said activity thus was an adventure in the nature of trade, which was carried on for profit-motive. Accordingly relying on the amendment made in section 2(15) as well as the provisions of section 28(iii), he held that the assessee was not entitled for exemption under section 11 and the income of the assessee was liable to be computed in the normal commercial manner. Accordingly an addition of ₹ 10,99,314/- was made by him to the total income of the assessee under the head income from business or profession in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not established that it was' for the purpose of general public utility and for public at large. The stalls are allotted and fee charges from those persons who are engaged in leather business and activity is done for promotion of leather business only. The appellant has not been able to establish as to how it can be distinguished from installation of stall and fair activities are not for promotion of particular trade and the participants are not only from leather business. The participants paid fee for every facility which shows that it was running on commercial line . 4. Aggrieved by the orders of the ld. CIT(Appeals), the assessee has preferred these appeals before the Tribunal on the following grounds as revised:- 1. That, on facts as well as on law, the Learned Commissioner of Income Tax (Appeals) - 25, Kol has erred in confirming the denial of exemption under section 11 claimed by the appellant in the return of income despite such exemption was being allowed to the appellant consistently. 2 That. on facts as well as on law, the Learned Commissioner of Income Tax (Appeals) - 25, Kol has erred in confirming the application of 1 st Proviso to section 2(15) inspite of the fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n leather science by organizing popular scientific talks and by defusing basic and applied scientific knowledge and in pursuance of these objects, which were considered as charitable while granting registration under section 12A to the assessee, exhibitions were organized by the assessee known as LEXPO during the year under consideration and income from Stalls rent and entry ticket charges was generated. There was also income generated by the assessee from sale of publication. In the return of income filed for the year under consideration, exemption under section 11 was claimed by the assessee for the said income but the said exemption was denied by the Assessing Officer in the assessment completed under section 143(3) by relying on the proviso to section 2(15) as amended w.e.f. A.Y. 2009-10 as well as the provisions of section 28(iii) of the Act. It is observed that in the case of Indian Chamber of Commerce vs.- ITO involving similar facts the claim of the assessee for exemption under section 11 was denied by the Assessing Officer as well as by the ld. CIT(Appeals) and the Tribunal vide its order dated 02.12.2014 passed in ITA No. 1491/KOL/2012 allowed the said claim, inter alia, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut in section 2(15) of the Act and also the definition of business in relation to the said section amply revels that the theory of dominant purpose has always, all through the years, been upheld to be the determining factor laying down whether the Institution is Charitable in nature or not. Where the main object of the Institution was charitable in nature, then the activities carried out towards the achievement of the said, being incidental or ancillary to the main object, even if resulting in profit and even if carried out with non members, were all held to be charitable in nature. Hon ble Apex Court in earliest case of Andhra Chamber of Commerce (supra) had clearly laid out the principle that if the primary purpose of an Institution was advancement of objects of general public utility, it would remain charitable even if an incidental or ancillary activity or purpose, for achieving the main purpose, was profitable in nature. In our view the basic principle underlying the definition of charitable purpose remained unaltered even on amendment in the section 2(15) of the Act w.e.f. 01/04/2009, though the restrictive first proviso was inserted therein. Accordingly, in the given facts o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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