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TMI Blog2022 (10) TMI 948X X X X Extracts X X X X X X X X Extracts X X X X ..... der Section 11(4) and not under Section 11(4A) of the Act. Section 11(4A) of the Act, would apply only to a case where the business is not held under trust. There is a difference between a property or business held under trust and a business carried on by or on behalf of the trust. This distinction was recognized in Surat Art Silk [ 1979 (11) TMI 1 - SUPREME COURT] which observed that if a business undertaking is held under trust for a charitable purpose, the income from it would be entitled to exemption under Section 11(1) of the Act. Pure charity in the sense that the performance of an activity without any consideration is not envisioned under the Act. If one keeps this in mind, what Section 2(15) emphasizes is that so long as a GPU s charity s object involves activities which also generates profits (incidental, or in other words, while actually carrying out the objectives of GPU, if some profit is generated), it can be granted exemption provided the quantitative limit (of not exceeding 20%) under second proviso to Section 2(15) for receipts from such profits, is adhered to. The insertion of Section 13(8)144, the seventeenth proviso to Section 10(23C) and third proviso to Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount towards consideration for such an activity (advancing general public utility), which is on cost-basis or nominally above cost, cannot be considered to be trade, commerce, or business or any services in relation thereto. It is only when the charges are markedly or significantly above the cost incurred by the assessee in question, that they would fall within the mischief of cess, or fee, or any other consideration towards trade, commerce or business . In this regard, the Court has clarified through illustrations what kind of services or goods provided on cost or nominal basis would normally be excluded from the mischief of trade, commerce, or business, in the body of the judgment. Section 11(4A) must be interpreted harmoniously with Section 2(15), with which there is no conflict. Carrying out activity in the nature of trade, commerce or business, or service in relation to such activities, should be conducted in the course of achieving the GPU object, and the income, profit or surplus or gains must, therefore, be incidental. The requirement in Section 11(4A) of maintaining separate books of account is also in line with the necessity of demonstrating that the quantitative limit pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 2(15) (as amended from time to time) has to be complied with, if the regulatory body is to be considered as one with charitable purpose eligible for exemption under the IT Act. Like statutory authorities which regulate professions, statutory bodies which certify products (such as seeds) based on standards for qualification, etc. will also be treated similarly. Trade promotion bodies - Bodies involved in trade promotion (such as AEPC), or set up with the objects of purely advocating for, coordinating and assisting trading organisations, can be said to be involved in advancement of objects of general public utility. However, if such organisations provide additional services such as courses meant to skill personnel, providing private rental spaces in fairs or trade shows, consulting services, etc. then income or receipts from such activities, would be business or commercial in nature. In that event, the claim for tax exemption would have to be again subjected to the rigors of the proviso to Section 2(15) of the IT Act. Non-statutory bodies - In the present batch of cases, non-statutory bodies performing public functions, such as ERNET and NIXI are engaged in important public purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n - As noted that the conclusions arrived at by way of this judgment, neither precludes any of the assessees (whether statutory, or non-statutory) advancing objects of general public utility, from claiming exemption, nor the taxing authorities from denying exemption, in the future, if the receipts of the relevant year exceed the quantitative limit. The assessing authorities must on a yearly basis, scrutinize the record to discern whether the nature of the assessee s activities amount to trade, commerce or business based on its receipts and income (i.e., whether the amounts charged are on cost-basis, or significantly higher). If it is found that they are in the nature of trade, commerce or business , then it must be examined whether the quantified limit (as amended from time to time) in proviso to Section 2(15), has been breached, thus disentitling them to exemption. - C.A. No. 8193/2012; C.A. No. 5057/2012; C.A. No. 5058/2014; C.A. No. 9974/2018; C.A. No. 5056/2012; C.A. No. 4196/2015; C.A. No. 4374/2015; C.A. No. 9380/2017; C.A. No. 13071/2017; C.A. No. 12058/2017; C.A. No. 16375/2017; C.A. No. 12869/2017; C.A. No. 17527/2017; C.A. No. 21845/2017; C.A. No. 5719/2018; C.A. No. 98 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0; C.A. No. _____/2022 @ SLP (C) No. _____/2022 @ Diary No(s). 23310/2020; C.A. No. _____/2022 @ SLP(C) No. 3759/2021; C.A. No. _____/2022 @ SLP(C) No. 4612/2021; C.A. No. _____/2022 @ SLP(C) No. 5167/2021; C.A. No. _____/2022 @ SLP(C) No. 6253/2021; C.A. No. _____/2022 @ SLP(C) No. 5709/2021; C.A. No. _____/2022 @ SLP(C) No. 6005/2021; C.A. No. _____/2022 @ SLP(C) No. 7166/2021; C.A. No. _____/2022 @ SLP(C) No. 7003/2021; C.A. No. _____/2022 @ SLP(C) No. 7011/2021; C.A. No. _____/2022 @ SLP(C) No. 6917/2021; C.A. No. _____/2022 @ SLP(C) No. 7510/2021; C.A. No. _____/2022 @ SLP(C) No. 19044/2021; C.A. No. _____/2022 @ SLP(C) No. 7779/2018; C.A. No. _____/2022 @ SLP(C) No. 4678/2021; C.A. No. _____/2022 @ SLP (C) No. _____/2022 @ Diary No(s). 5806/2021; C.A. No. _____/2022 @ SLP(C) No. 4636/2021; C.A. No. _____/2022 @ SLP(C) No. 4723/2021; C.A. No. _____/2022 @ SLP (C) No. _____/2022 @ Diary No(s). 6662/2021; C.A. No. _____/2022 @ SLP(C) No. 10490/2021; C.A. No. _____/2022 @ SLP(C) No. 6686/2021; C.A. No. _____/2022 @ SLP(C) No. 7302/2021; C.A. No. _____/2022 @ SLP(C) No. 6580/2021; C.A. No. _____/2022 @ SLP(C) No. 7290/2021; C.A. No. _____/2022 @ SLP(C) No. 7606/2021; C.A. No. ____ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tation of Section 2(15), the definition clause .............................................................. 70 Summation of interpretation of Section 2(15) .............................................................................. 85 C. Sections 10, 11, 12, 12A, 12AA and 13 of the IT Act .............................................................. 86 Distinction between business held under Trust [Section 11(4)] and Trust carrying on business [Section 11(4A)] 87 D. What kinds of income or receipts may not be characterized as derived from trade, commerce, business or in relation to such activities, for a consideration .............................................................................. 98 (i) Statutory corporations, authorities or bodies ........................................................................... 98 (ii) Statutory regulatory bodies/authorities .................................................................... .............. 109 (iii) Trade Promotion bodies, councils, associations or organizations........................................... 114 (iv) Non-statutory bodies - ERNET, NIXI and GS1 India ..................................................... ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e trusts has taken effective measures to minimise misuse of trust funds. As a result, a charitable trust loses tax exemption if certain provisions are not complied with, and if its activities do not fall under Section 10 of the Act. Such trusts also have to apply their income to the charitable objects within a specified period, maintain proper audited accounts, and invest or utilise funds in a manner so that no benefit is derived by the settlor, trustees, their relatives, or other persons. Sections 11, 12, 12-A and 13 of the Income-tax Act, 1961 3. The scope and amplitude of the definition charitable purpose under the Income Tax Act, 1961 (hereafter Income Tax Act or the IT Act ) has engaged the courts (including that of this court) attention on myriad occasions. The expression not involving the carrying on of any activity for profit in the last limb of the definition [Section 2(15) prior to amendment by Finance Act, 1983] was the subject of debate in no less than five judgments of this court (including that of a five-member bench). 4. In these batch of appeals and special leave petitions, the primary question which falls for consideration is the correct interpretation of the provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 415 (hereafter In Re: Trustees of the Tribune ). (hereafter In Re: Trustees of the Tribune ) held that the income of the Tribune Press fell within section 4(3)(i) of the old Act, and it was implied that income from the press was derived from property held under trust to maintain a newspaper, to keep up its liberal policy and to devote surplus funds to improve the newspaper. The word property occurring under section 4(3)(i) of that Act was also held In Commissioner of Income Tax v. P. Krishna Warriar, (1964) 8 SCR 36 : (1964) 53 ITR 176 this court, citing and relying on In re, Trustees of the Tribune [(1939) ITR 415 PC] held that: This Court in J.K. Trust, Bombay v. Commissioner of Income Tax, Excess Profits Tax, Bombay [(1957) 32 ITR 535] endorsed the said view and held that property is a term of the widest import and that business would undoubtedly be property unless there was something to the contrary in the enactment. If business was property, it could be held under trust for religious and charitable purposes. As the business of running the Arya Vaidya Sala vested under trust for religious and charitable purposes, it would fall under clause (i), if the other conditions laid dow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able trust, the new clause should have been added as proviso to the old clause. 7. The Act was again amended by the Finance Act, 1953 7 Section 4 of Finance Act, 1953 added proviso to Section 4(3)(i); it reads as follows: Provided that such income shall be included in the total income- [(a) if it is applied to religious or charitable purposes without the taxable territories, but in the following cases, namely:- (i) where the property is held under trust or other legal obligation created before the commencement of the-Indian Income-tax (Amendment) Act, 1953 (XXV of 1953), and the income therefrom is applied to such purposes without the taxable territories; and (ii) where the property is held under trust or other legal obligation created after such commencement, and the income therefrom is applied without the taxable territories to charitable purposes which tend to promote international welfare in which India is interested, the Central Board of Revenue may, by general or special order, direct that it shall not be included in the total income;] (b) in the case of income derived from business carried on on behalf of a religious or charitable institution, unless the income is applied wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... art of the income from property held under a trust or other legal obligation for private religious purposes which does not enure for the benefit of the public. This court had occasion to interpret the meaning of the expression advancement of any other object of general public utility in CIT v. Andhra Chamber of Commerce (1965) 1 SCR 565 (hereafter Andhra Chamber of Commerce ) . The court considered previous decisions in: In Re: Trustees of the Tribune (supra) and All India Spinners Association of Mirzapur v. CIT (1944) 12 ITR 482 (hereafter All India Spinners Association of Mirzapur ) . Relying heavily on the decision of the Privy Council in In Re: Trustees of the Tribune (supra), this court held, in Andhra Chamber of Commerce that GPU objects included all objects promoting welfare of general public, including taking steps to oppose or urge legislation affecting trade, commerce, etc. B. The new law: Income Tax Act, 1961 9. Section 2 (15) of the IT Act (which came into force on 01.04.1962 and repealed the old IT Act) defined charitable purpose as follows: (15) ― charitable purpose includes relief of the poor, education, medical relief, and the advancement of any other object o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the absence of some indication to the contrary that the object of the trust involves the carrying on of an activity for profit .. By the use of the expression profit motive it is not intended that profit must in fact be earned. Nor does the expression cover a mere desire to make some monetary gain out of a transaction or even a series of transactions. It predicates a motive which pervades the whole series of transactions effected by the person in the course of his activity . The court also rejected the submission that the profit referred to meant private profit. It held that the term had to be interpreted without qualification. 12. One of the judges - Beg, J, concurred with the majority, but after noticing that the trust deed did not contain any condition on profit-making, expressed a slightly different view emphasizing that the actual activity needs to be considered, rather than the absence or existence of any condition, in the trust deed. (1976) 1 SCC 324 (hereafter Indian Chamber of Commerce ) . The next decision of importance is Indian Chamber of Commerce v. CIT 13. The appellant-chamber was a company registered under Section 25 of the Indian Companies Act, 1913. Its memorandum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... general public utility by an institution which charges large sums and makes huge profits. Indubitably they render services of general public utility. Their objects are charitable but their activities are for profit ********** 16. To sum up, Section 2(15) excludes from exemption the carrying on of activities for profit even if they are linked with the objectives of general public utility, because the statute interdicts, for purposes of tax relief, the advancement of such objects by involvement in the carrying on of activities for profit. We appreciate the involved language we use, but when legislative draftsmanship declines to be simple, interpretative complexity becomes a judicial necessity. ********** 21. The true test is to ask for answers to the following questions: (a) Is the object of the assessee one of general public utility? (b) Does the advancement of the object involve activities bringing in moneys? (c) If so, are such activities undertaken (i) for profit or (ii) without profit? Even if (a) and (b) are answered affirmatively, if (c)(i) is answered affirmatively, the claim for exemption collapses. The solution to the problem of an activity being one for or irrespective of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bers of the assessee. The Income Tax Appellate Tribunal (hereafter ITAT ) after initial remand to the Appellate Commissioner, held that the primary purpose for which the assessee was established was to promote commerce and trade in Art Silk and Silk Yarn and Cloth . The ITAT made a direct reference of the issue, to this court, since a conflict existed with regard to the correct interpretation of the residual clause, i.e., institutions engaged in the advancement of objects of general public utility, and whether the company was entitled to be assessed as one carrying on activities that amounted to charitable purposes. This court first determined that the primary or dominant object of the company was promotion and development of trade in silk, silk cloth, yarn and other such items and that the other objects were subsidiary to this primary object. It then held that the requirement of absence of profit motive, was satisfied: 7...but this requirement was also satisfied in the case of the assessee, because the object of private profit was eliminated by the recognition of the assessee under section 25 of the Companies Act, 1956 and clauses 5 and 10 of its Memorandum. It must, therefore, be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be asked for this purpose is as to when can the purpose of a trust or institution be said to involve the carrying on of any activity for profit. The word involve according to the Shorter Oxford Dictionary means to enwrap in anything, to enfold or envelop; to contain or imply . The activity for profit must, therefore, be intertwined or wrapped up with or implied in the purpose of the trust or institution or in other words it must be an integral part of such purpose. But the question again is what do we understand by these verbal labels or formulae; what is it precisely that they mean? Now there are two possible ways of looking at this problem of construction. One interpretation is that according to the definition what is necessary is that the purpose must be of such a nature that it involves the carrying on of any activity for profit in the sense that it cannot be achieved without carrying on an activity for profit. On this view, if the purpose can be achieved without the trust or institution engaging itself in an activity for profit, it cannot be said that the purpose involves the carrying on of an activity for profit ****************** ************** 16. The other interpretati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied on with the object of earning profit. Profit-making must be the end to which the activity must be directed or in other words, the predominant object of the activity must be making a profit. Where an activity is not pervaded by profit motive but is carried on primarily for serving the charitable purpose, it would not be correct to describe it as an activity for profit. But where, on the other hand, an activity is carried on with the predominant object of earning profit, it would be an activity for profit, though it may be carried on in advancement of the charitable purpose of the trust or institution. Where an activity is carried on as a matter of advancement of the charitable purpose or for the purpose of carrying out the charitable purpose, it would not be incorrect to say as a matter of plain English grammar that the charitable purpose involves the carrying on of such activity, but the predominant object of such activity must be to subserve the charitable purpose and not to earn profit. The charitable purpose should not be submerged by the profit making motive; the latter should not masquerade under the guise of the former . 17. The court took note of the judgment of Pathak, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g, the court could assume (in the absence of something to the contrary) that the trust s object involved carrying on of an activity for profit. The Constitution Bench disagreed with the approach in both the previous judgments, and observed: 19. Now we entirely agree with the learned Judges who decided these two cases that activity involved in carrying out the charitable purpose must not be motivated by a profit objective but it must be undertaken for the purpose of advancement or carrying out of the charitable purpose. But we find it difficult to accept their thesis that whenever an activity is carried on which yields profit, the inference must necessarily be drawn, in the absence of some indication to the contrary, that the activity is for profit and the charitable purpose involves the carrying on of an activity for profit. We do not think the Court would be justified in drawing any such inference merely because the activity results in profit. It is in our opinion not at all necessary that there must be a provision in the constitution of the trust or institution that the activity shall be carried on no profit no loss basis or that profit shall be proscribed. Even if there is no su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here was, however, a discordant note in Surat Art Silk - A.P. Sen, J disagreed with the majority, and delivered a dissenting opinion. Explaining how there were no restrictive words or conditions, under the old IT Act, the learned judge held that the approach indicated in Lok Shikshana Trust and Indian Chamber of Commerce were correct. He felt that the previous decisions of the court were not relevant, and that if the activities of a trust involved any activity for profit or business, the organization ceased to be charitable, and that such proceeds were utilized for charitable objects, were not relevant. He also noted that A reading of Section 2(15) and Section 11 together shows that what is frowned upon is an activity for profit by a charity established for advancement of an object of general public utility in the course of accomplishing its objects. The same judgment also stated that: if the object of the trust is advancement of an object of general public utility and it carried on any activity for profit, it is excluded from the ambit of charitable purpose defined in Section 2(15). The distinction is clearly brought out by the provision contained in Section 13(1)(bb) inserted by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overnment in this behalf in the Official Gazette; (b) the business is carried on by an institution wholly for charitable purposes and the work in connection with the business is mainly carried on by the beneficiaries of the institution; and separate books of accounts are maintained by the trust or institution in respect of such business was inserted by the Finance Act, 1983, w.e.f. 01.04.1984. Subsequently, Section 11(4A) was amended and substituted by the following provision w.e.f. 01.04.1992 (and continues to be in force): (4A) Sub-section (1) or sub-section (2) or sub-section (3) or sub-section (3A) shall not apply in relation to any income of a trust or an institution, being profits and gains of business, unless the business is incidental to the attainment of the objectives of the trust or, as the case may be, institution, and separate books of account are maintained by such trust or institution in respect of such business. E. The judgment in Thanthi Trust 22. This court comprehensively interpreted these provisions as they existed, in different time periods, in Assistant Commissioner of Income Tax v. Thanthi Trust (2001) 2 SCC 707; (2001) 1 SCR 727 where this court had to decid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat for the assessment years in question the Trust was not entitled to the exemption contained in section 11 in respect of the income of its newspaper. 23. For the third period (1992-93 to 1996-97), the court dealt with the meaning and effect of Section 11(4A) (amended and substituted w.e.f. 01.04.1992) and held that the assessee trust was entitled to be treated as a charity: 25. The substituted sub-section (4A) states that the income derived from a business held under Trust wholly for charitable or religious purposes shall not be included in the total income of the previous year of the Trust or institution if the business is incidental to the attainment of the objective of the Trust or, as the case may be, institution and separate books of account are maintained in respect of such business. Clearly, the scope of sub-section (4A) is more beneficial to a Trust or institution than was the scope of sub-section (4A) as originally enacted. In fact, it seems to us that the substituted sub-section (4A) gives Trust or institution a greater benefit than was given by section 13(1)(bb). If the object of Parliament was to give Trusts and institutions no more benefit than that given by section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levant for deciding the primary question (i.e., as to what charitable purpose is, under Section 2 (15)), they still have an important bearing in the present case. This is because in view of the circumstances that the provisions were deleted w.e.f. 01.04.2003, housing boards, and bodies, as well as sports associations, that were earlier claiming exemption of their income under these provisions, now sought to claim that they were charities. G. Amendments to Section 2 (15) by Finance Act, 2008 (w.e.f. 01.04.2009) 27. Section 2(15) - which had been amended last, in 198324, was again amended, by Finance Act, 2008, w.e.f. 01.04.2009. Some other amendments too were made, with effect from the same date by the Finance Act, 2009 and Finance Act, 2010. With the said amendments, as on 01.04.2009, the provision read as follows: (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 interest, and the advancement of any other object of general public utility: Provided that the advancement of any other object of general public ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erent. Those decisions consequently did not rule out carrying on of activities akin to business, by charitable institutions established to advance general public utility. 29. The ASG next submitted that Parliament s intent, in changing the law, was to expressly forbid the tax exemption benefit if the entity was involved in carrying on trade or business. The revenue relied on the two decisions in Lok Shikshana Trust, and Indian Chamber of Commerce (supra), highlighting that the significance of the change brought about by Section 2(15) of the IT Act was noticed. Particular reliance was placed on the observations of Beg, J in Lok Shikshana Trust and the passages in Indian Chamber of Commerce to urge that the involvement of an entity in the carrying on of activities for profit, even if for advancement of charitable purpose or object, disentitled it to tax exemption. The learned ASG urged that this court had recognized from its earlier decisions that the prohibition from carrying on trade or commerce activities applied only to charities meant to advance general public utility and not the other categories such as education, medical relief, or relief to the poor (which are per se exempt). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nstitution engages itself in activities for profit. The Calcutta decisions are right in linking; activities for profit with advancement of the object. If you want immunity from taxation, your means of fulfilling charitable purposes must be unsullied by profit making ventures. 32. It was then urged that before the decision in Surat Art Silk (supra) two legislative developments took place, which reinforced the revenue s view that charities cannot engage in commercial activities. The first was the amendment, carried out in 1975 to the IT Act (w.e.f. 01.04.1976), which introduced Section 10 (23C) and had the effect of excluding income received by inter alia, any fund or institution, established for charitable purposes. The said provision, to the extent relevant, is extracted as follows: 10. In computing the total income of a previous year of any person, any income falling within any of the following clauses shall not be included- ******* ******** (23C) any income received by any person on behalf of- (i) the Prime Minister' s National Relief Fund; or ******* ***** ***** (iv) any other fund or institution established for charitable purposes The other amendment was introduction of Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fulfil the mandate and restrictions under Section 2(15), especially proviso (ii). The ASG cited the larger bench decision in New Delhi Municipal Council v. State of Punjab (1997) 7 SCC 339 (hereafter NDMC ) (hereafter NDMC ) to urge that state entities are not exempt from Union taxation, if they engage in trade or business. It was furthermore submitted that the effect of proviso (i) to Section 2(15) is that there can be no question of any incidental activity; nor can the proceeds of trade claim to be exempt merely because they are ploughed back to feed the charitable object. B. Arguments of the assessee-organizations 37. Mr. S.N. Soparkar, learned Senior Advocate appeared for the Ahmedabad Urban Development Authority (hereafter AUDA ); the Gujarat Industrial Development Corporation (hereafter GIDC ) and Gujarat Housing Board (hereafter GHB ). Counsel submitted that all three corporations were established by or under statutes enacted by the Gujarat legislature; they were treated as local authority under Section 10(20) of the IT Act, as it existed till 2003. Thereafter they were treated as charitable institutions engaged in activities involved in the advancement of public utility til ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions are controlled by the parent enactments under which they were created. Furthermore, on advancing of its affairs in such a manner that if any surpluses are generated, they were used for furthering the objectives of law. Thus, for instance, if surplus is generated in the activities of AUDA, GIDC, or GHB, those would not be handed to the State Government, which previously had control over them but rather kept in a separate fund to be utilised for further development, expansion and development activities by each of such corporations. These cannot be construed as carrying on any trade, business or commerce. 40. It was submitted that the decisions in In Re: Trustees of the Tribune; Krishna Warriar and Lok Shikshana Trust (supra) were all in the context of entities which carried on business. Moreover, in the first two decisions, the law as it then stood did not contain any restriction prohibiting trade or commerce activity. Learned counsel submitted that the judgment in Indian Chamber of Commerce (supra) was specifically overruled in Surat Art Silk (supra). Therefore, it may be treated as having no precedential value on subject. Learned counsel highlighted the observations in Surat A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... derived from incidental trading or business activities, would not result in it being characterised as an entity carrying on business; in other words, it was one carrying on a charitable objective or purpose. 43. Learned counsel also relied upon Circular 11/2008 dated 19.12.2008 which highlighted that whether the activities carried on by any charitable institutions are in the nature of trade or whether they are essentially charitable is a question of fact. It also spelt out that if an assessee is engaged in any activity, in the nature of trade, commerce or business or rendering any services in relation to such trade etc., it could not claim that its object was charitable. In such event, the object of general public utility will only be a means or defence to highlight the true purpose which is trade, service or business . . It was emphasised therefore that the circular and the speech of the Finance Minister during the budget clearly pointed out organisations, trust or entities which were masquerading as charitable but in reality carrying on business. On the other hand, genuine charitable organisations which generated income for their sustenance could not be denied the benefit of tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , argued that Section 2(15) cannot be read in isolation, but should be construed in the light of the minister s speech while introducing the amendment, and the Circular (i.e. Circular 11/2018). Therefore, if an organisation is created and carries on its activities with a view to earn profit as was held in Bajaj Electricals, Khoday Distilleries, and Raipur Manufacturing (supra), it is precluded from claiming to be a charitable organisation. On the other hand, if the entity is primarily set up for the charitable purpose, i.e., to carry on activities for the advancement of general public utility, but it also carries activities that generate surplus or money, they cannot be per se excluded from consideration for tax benefit. 47. Learned Senior Counsel Mr. Kavin Gulati argued for NOIDA and relied upon the Constitution Bench judgment of this court in Commissioner of Central Excise, Bolpur v. Ratan Melting and Wire Industries (2008) 13 SCC 1 to urge that a circular cannot define an ambit of a provision. He highlighted the decision rendered by the Delhi High Court in Greater Noida Industrial Development Authority v. Union of India Ors 2018 SccOnline Delhi 7536, where the assessee s activit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rofit-no loss basis as is evident from the preamble48, the aims and objectives49 of the board as well as Sections 3, 5, 6, 28, 29, 43 and 4650 of the KIAD Act. Reliance was placed on Karnataka Industrial Areas Development Board v. Prakash Dal Mill51 which held that KIADB is state under Article 12 of the Constitution, and it was urged that KIADB was an extension of the Karnataka Government. The board exercises power of eminent domain and it performs governmental functions. Its activities, therefore, cannot be regarded as trade or business. Reliance was placed upon State of Karnataka v. All India Manufacturer s Organisation52. 51. It was submitted that in the absence of profit motive, the activity is not trade, commerce or business - within the meaning of first proviso to Section 2(15) of the IT Act, 1961. Reliance was placed upon Khoday Distilleries (supra), State of Tamil Nadu v. Board of Trustees of the Port of Madras53 and several other decisions54. It was argued that wherever it is intended, profit element is wholly excluded from activity - reliance was placed on provisions of the Karnataka VAT Act, The Central Goods and Service Tax Act ( CGST Act ) and Section 2(31) of the IT A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t has affiliates in each country with the assistance of national governments. GS1 India the assessee, is an affiliate; it was registered as a society in the year 1996, with the Joint Secretary-Ministry of Commerce as its President and the administrative control vests with the Ministry of Commerce, Government of India. It was registered as a charitable GPU category society in 1996. All the trade bodies60 as well Bureau of Indian Standards are members of its governing council. 54. It was submitted that the revenue had granted exemptions to the assessee society under Section 12A and Section 10(23C)(iv) while issuing various certificates from time to time (from AY 1996-1997 to 2007-2008); therefore, it had accepted that the assessee s object and purpose was charitable, i.e., advancement of general public utility. Also, to reflect that there is no business/trade/commerce involved and profit motive is absent the learned counsel relied upon the decision of the assessee society to issue substantial discounts to the extent of 50% to deserving sectors like cottage industries to enable augmentation of market for such sectors, as well as the letter written by CEO-GS1 to the President GS1 (i.e. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... existence, by an Act or under an Act. In short, the term refers to a statutory corporation as contrasted from a non-statutory corporation incorporated or registered under the Companies Act. 58. Learned senior counsel lastly submitted that an activity, to be trade, commerce or business , must be profit driven. Profit motive is a quintessential element and an activity without profit motive will not result in trade, commerce or business in terms of the decision in State of A.P v. H. Abdul Bakhi Bros63. If exemption is not granted to the assessee it will face a liability of around ₹300 crore (from FY-2007-08 to 2020-21), which given its financial condition will jeopardise its existence and functioning. 59. Ms. Radhika Suri, learned counsel argued on behalf of Bhatinda Improvement Trust and adopted the submissions of Mr. Soparkar. She urged, in addition, that it is obligatory on part of the assessee (a statutory corporation) to use the monies received for public utility purpose and the price fixation of lands/plots sold by them is also regulated through statutory regulations. Therefore, such activities qualify the test of general public utility. Ms. Suri also relied on the decisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atures of the GMB Act. These features in context of the controversy at hand, under the provisions of the IT Act, were considered by this court in the Gujarat Maritime Board case (supra). The decision discussed Sections 73, 74 75 of the GMB Act, which provide for management of all monies received by the GMB; and Section 76 of the GMB Act, which permits the setting aside of surplus money only for expanding existing facilities or creating new facilities at the ports or for meeting with contingencies caused on account of fire, cyclones, shipwrecks or other accidents or for any other emergency. It was stressed that that judgment clearly indicates GMB has no profit motive. It was therefore, urged that the provisions of the GMB Act, indicate the overwhelming public purpose carried out by it without profit motive and that utilization of funds is only for the purpose of development, management and safety of minor ports; all these entitles GMB to exemption. 62. Mr. Rohit Jain, learned counsel, appeared on behalf of the Education and Research Network (ERNET) and National Internet Exchange of India (NIXI). On behalf of ERNET it was submitted that it was started as a planned project of the Gove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Communication Technology infrastructure for making education reach the public at large solely for charitable purpose and further reliance was placed upon ICAI Accounting Research Foundation v. DGIT(E)70, Bureau of Indian Standards v. DGIT(E)71 and GS1 India v. DGIT(E)72. 66. Mr. Ajay Vohra, learned senior counsel, appearing for the Apparel Export Promotion Council (AEPC) urged that it is a non-profit organization set up with approval of the Central Government, for promotion of exports of garments from India (i.e., promotion of trade). It was registered under Section 12AA(1) of the IT Act, on 18.05.1979 and is engaged in the activity of promotion of the export of all kind of ready-made garments, knitwear, and garments made of leather, jute and hemp. It does not per se engage in any activity for profit, and its mandate is to ensure that Indian apparel manufacturers, are given forums and platforms, to showcase their products. For that purpose, the AEPC charges subscriptions, and provides services, which have general public utility. These activities are by way of booking large spaces in fairs, and such like events, especially in overseas locales, so that Indian manufacturers can in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 11 of the Act. Subsequently, an amendment was brought to Section 11(4A) and AEPC had to maintain separate books of accounts. In AY 1992-93, the AO again denied exemption. On appeal, the issue was decided in favour of AEPC by the ITAT. The Delhi High Court upheld the order of the ITAT in a judgment80. AEPC received entrance fee and membership fee which, it claimed were exempt on the principle of mutuality. This issue too was resolved in its favour from the AY 1992-93 to AY 1997-98 by the jurisdictional High Court. From the assessment year 1998-99 to the assessment year 2008-09, the AO accepted the assessee s claim that income was exempt under Section 11 of the Act. 69. During AY 2009-10 and 2010-11, the AO denied exemption under Section 11 on the ground that the newly inserted proviso to Section 2(15) was attracted; and thus the assessee was ineligible for exemption under Section 11. The AO held that the assessee was rendering services in relation to trade, commerce business for consideration and the receipt of which exceeds ₹10 lakhs. The CIT(A) allowed the assessee s appeal following the decision of the High Court in its case, and there being no changes in the facts and c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d under Section 12AA of IT Act, as the object of the authority is to provide shelter to homeless people, which is charitable. 72. Mr. Harish Salve, learned senior counsel appearing on behalf of Saurashtra Cricket Association drew attention of this court towards the ambit of Section 4(3) of Income Tax Act, 1922 (i.e., the old Act), as compared to Section 2(15) of the IT Act, 1961 which defines charitable purpose . He also presented the construction of Section 11 in light of Thanthi Trust (supra). It was emphasized that the objects of a trust are decisive and every surplus cannot be construed as profit, as is discussed in Krishna Warriar (supra). Profits from trade or business arising out of property held under trust for charitable purpose, if ploughed back to the extent of 100% cannot be termed as a commercial activity. This was the principal idea in omitting Section13(1)(bb) as it was considered as restrictive for carrying out such activities. It was argued that, substitution of the definition of charitable purpose in Section 2(15) by the Finance Act, 2008 has not changed the law. The words in relation to any trade, commerce or business and for a cess, fee or consideration in the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acterized as trading concerns. 75. Mr. Salve submitted that cricket associations are operating purely to advance their objective of promoting the sport. They should not be considered as pursing activities in furtherance of trade, commerce or business. The word cess has to be read down in reverse (reverse ejusdem generis) and it should be read non-statutorily while adopting purposive interpretation of the same. Reliance was placed on Nabha Power Limited v. Punjab SPCL82 to state that a purposive interpretation of cess , is to be adopted. 76. It was also argued that the sport of cricket is a form of education and if it is not considered as a field of education, it is still an object of general public utility. The primary regulating body i.e., the BCCI, promotes sport in the entire country and worldwide, and the assessees herein are its second and third tier associations. The revenue generated by BCCI flows to state and regional cricket associations in the form of grants to maintain stadia, conduct matches, organize training camps, and other ancillary purposes. Counsel relied on the objects of Saurashtra Cricket Association which inter alia include, the control, supervision, regulatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itute which include holding of examinations for chartered accountancy course candidates and regulation of engagement and training of articled clerks and audit assistants. 80. It was submitted that holding of coaching and revision classes, and surplus generated due to the fees collected from that activity is not a business or commercial activity. Counsel urged that it is wholly incidental and ancillary to the objects of the institute - which is to provide education and conduct examinations of the candidates enrolled for chartered accountancy courses, so as to bring out true professionalism. Therefore, separate books of accounts are not required to be maintained in terms of Section 11(4A) read with the fifth and seventh proviso to Section 10(23C) of IT Act, 1961. It was urged that ICAI was not hit by the proviso to Section 2(15) of the IT Act (inserted w.e.f. 01.04.2009) since its activities fall within the purview of the clause education specified in the definition of the expression charitable purpose in S. 2(15) of the said Act, and not the residuary clause relating to the GPU category, wherein the proviso solely applies to the latter. In this regard the counsel referred to the Guj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions of the Finance Act, 2008, specifically towards amendment made to Section 2(15) of the IT Act, aimed at streamlining the definition of charitable purpose as discussed in para 595 and the ratio Visvesvarya Technological University v. Assistant Commissioner of Income Tax96 to submit that there is no loss to the character of a GPU charity where surplus generated is ploughed back. Further, a judgment of the Division Bench of the Delhi High Court in J.K Synthetics Another v. Union of India Ors.97 was referred to contend that it is not open for the revenue authorities, without any cogent reason and merely at its own caprices, to refuse to follow the conclusion reached on the earlier occasion, and to take up a totally different stand in subsequent years - as was done in this case while refusing to grant exemption under Section 10 (23C) of IT Act, 1961 to the ICAI. 84. Learned counsel further submitted that the present case involves two circulars issued by the Board viz. Circular No. 1/2009 dated 27.03.2009 and Circular No. 11/2008 dated 19.12.2008 which are clarificatory and not contrary to any provisions of the Act, 1961 and hence the ratio of the decision in Ratan Melting and Wire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty of Section 2(15) in the context of Article 14 and Article 289. It was submitted that classification made in the ITPO judgment i.e., institutions driven by profit motive vis- -vis institutions driven by motive to advance objective of GPU, was correct and is in tune with the decision of this court in NDMC (supra). It was urged that Article 289(1) will not apply to ITPO as its income and property cannot be regarded as income and property of a State. It was also submitted that proviso to Section 2(15) applies only to the last limb i.e., advancement of object of general public utility and not to the preceding limb education and in respect of charity there is no discernible difference between the two. Since there is no intelligible differentia and rational nexus in this regard, this discrimination offends Article 14. 89. It was argued that the term for a cess or fee or any other consideration used in Section 2(15) is clearly violative of Article 14 as it fails to make a distinction between activities that are carried out by the State or by the instrumentalities or agencies of the State, and those carried out by commercial entities for which a consideration is charged. In addition, Art ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted through statutory prescriptions, conditions, and limitations while granting an exemption from taxation. The submission of the assessees, that one has to look only at the objects to determine if it constitutes charitable purpose for Section 2(15) of the Act, is to be rejected because exemptions or exclusions are not based on mere objects of trust but on whether the purpose of the trust is advancement of any other object of general public utility . III. Analysis and reasoning 92. The history of the statute and the evolving interpretation of charitable purpose reveals that in - P. Krishna Warriar (supra), this court extensively considered the previous jurisprudence on the subject (in light of the pre-existing Section 4(3) of the old law), as well as the amendment introduced in 1953. At that time, income of a charitable organization, earned from business was subject to limitations. The limitations were that (i) the business was to be carried on in the course of the actual carrying out of a primary purpose of the trust or institution; or (ii) the work in connection with the business was to be mainly carried on by beneficiaries of the institution. These expressions were considered in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vity being one for or irrespective of profit is gathered on a footing of facts. What is the real nature of the activity? One which is ordinarily carried on by ordinary people for gain? Is there a built-in prescription in the constitution against making a profit?.... 95. The decision in Surat Art Silk, needs careful scrutiny, not only because it is by a larger Bench, but also because it has been the bulwark of the assessee s contentions- and has been the premise upon which almost all High Courts have interpreted Section 2 (15) after its amendment, in 2008. As noticed earlier, the old Act (in Section 4(3)) did not contain any terms, restricting or prohibiting charities from engaging in commercial activities or those which yielded profit. No doubt, the idea of income from business carried on behalf of a religious or charitable institution being exempt, provided the business is carried on in the course of the actual carrying out of a primary purpose of the institution was introduced by amendment, in 1953. This was interpreted in Andhra Chamber of Commerce and Krishna Warriar (supra). However, Parliament clearly intended a departure, when it introduced the new Section 2 (15) under the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tution of a given trust, eschewing profit motive, whereas in Indian Chamber of Commerce, the necessity of such a condition was highlighted. 98. The judgments of this court, after Surat Art Silk (supra), noticed the enunciation of, and the need to apply the test of dominant object. In Commissioner of Income Tax v. Federation of Indian Chambers of Commerce and Industries101 it was, thus held: In other words, the majority view in the Surat Art Silk's case (supra) was that the condition that the purpose should not involve the carrying on of any activity for profit would be satisfied if profit-making is not the real object. The theory of dominant or primary object of the trust has, therefore, been treated to be the determining factor, even in regard to the fourth head of charity, viz., the advancement of any other object of general public utility, so as to make the carrying on of business activity merely ancillary or incidental to the main object. 99. In Bar Council of Maharashtra (supra) this court considered whether a bar council, constituted under the Advocates Act, 1961, performed activities that were charitable in nature; it was held that the statute obliged several activities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication to such .. charitable purposes as relate to anything done within the taxable territories, and in the case of property so held in part only for such purposes, the income applied or finally set apart for application 102 could not be included as taxable income of any charitable organization. This provision is a precursor for Section 11 under the IT Act. In other words, the structure of the old Act did not prohibit the carrying on of business; it spelt out a condition that any income derived from business carried on in the course of the actual carrying out of a primary purpose of the institution if applied for charitable purposes, was exempt. 102. The second aspect is that Surat Art Silk (supra), was rendered in the context of Section 2(15) of the IT Act, as it stood originally. However, by the Taxation Laws Amendment Act, 1975 (w.e.f. 01.04.1977), Section 13(1)(bb) was inserted. That provision excluded the operation of Sections 11 and 12 (under which income of charities were entitled to be exempted) in the case of income derived from business by charities engaged in medical relief, education and relief to the poor, unless the business fulfilled a condition: (bb) in the cases o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re clear that after 1 April, 1984, the statute did not contain any restriction as to the nature of activity that could be carried on by GPU category charity. Furthermore, the condition in Section 13(1)(bb) - which applied to other kinds of trusts, i.e., that their incomes could be exempt under Section 11 to the extent they arose out of business, if the business was in the course of the actual carrying out of a primary purpose of the trust - was deleted. On the other hand, the wording of Section 11(4A) did seem to indicate that business activity was permissible if the objects of the trust were wholly charitable, and such business were to be carried on by its beneficiaries. This legal position continued, till the amendments in question were carried out, in relation to Section 2(15) in 2008. 106. Section 2 begins with the expression unless the context otherwise requires - as a preface to every expression which is sought to be defined, under the IT Act. The 1922 Act did not contain any words of restriction, in the definition clause. The IT Act, however, defined charitable purpose - at the outset, restrictively, and then, substantively enacted provisions that give effect to Parliamentar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nfines of the provision and to call in aid other well-recognised rules of construction, such as its legislative history, the basic scheme and framework of the statute as a whole, each portion throwing light on the rest, the purpose of the legislation, the object sought to be achieved, and the consequences that may flow from the adoption of one in preference to the other possible interpretation. 111. Other decisions109 have also commented on the use of history of the legislation as a tool for its construction. It is, therefore, clear that courts can look at the previous history of the statute, and the changes it underwent to discern what is intended by the lawmakers when an amendment is introduced, or a new law enacted. In light of these factors, it would therefore, also be useful for the court to consider the background which led to the amendment firstly in 2008 and thereafter in 2012 and 2015, seeking to restrict the nature of activities that a GPU category charity can legitimately undertake. (ii) Other extrinsic aids to construction of the statute (a) Speeches in Parliament 112. Speeches made in the legislature or Parliament, can be looked into for throwing light on the rationale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dealings or relations with any outside body, then any surplus returned to the persons forming such association is not chargeable to tax. In such cases, there must be complete identity between the contributors and the participants. Therefore, where industry or trade associations claim both to be charitable institutions as well as mutual organizations and their activities are restricted to contributions from and participation of only their members, these would not fall under the purview of the proviso to section 2(15) owing to the principle of mutuality. However, if such organizations have dealings with non-members, their claim to be charitable organizations would now be governed by the additional conditions stipulated in the proviso to section 2 (15). 114. Circular No. 1/2009 dated 27.03.2009 contains explanatory notes to provisions of the Finance Act, 2008. It inter alia reads as follows: 5. Streamlining the definition of charitable purpose 5.1 Sub-section (15) of section 2 of the Act defines charitable purpose to include relief of the poor, education, medical relief, and the advancement of any other object of general public utility. It has been noticed that a number of entities op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nies before 30.06.1955. The government felt that unless such a step was taken, the operation of Section 12(1B) would lead to extreme hardship, as it would cover the aggregate of all outstanding loans of past years and could have led to unreasonably high liability on shareholders to whom the loans might have been advanced. A circular [No. 20(XXI-6) /55] was issued by the Central Board of Revenue on 10.05.1955. The court, in that context, observed that: It is clear that a circular of the kind which was issued by the Board would be binding on all officers and persons employed in the execution of the Act under s. 5(8) of the Act. This circular pointed out to all the officers that it was likely that some of the companies might have advanced loans to their shareholders as a result of genuine transactions of loans, and the idea was not to the effect such transactions and not to bring them within the mischief of the new provision. The officers were, therefore, asked to intimate to all the companies that if the loans were repaid before the 30th June, 1955, in a genuine manner, they would not be taken into account in determining the tax liability of the shareholders to whom they may have bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e manners as laid down in Section 119. The power is given for the purpose of just, proper and efficient management of the work of assessment and in public interest. 119. The view expressed in Navnit Lal Jhaveri (supra), and later elaborated in UCO Bank (supra) appears to have found resonance in other decisions111 of this court. A recent instance where this court took aid of explanatory circulars is in CIT v. Vatika Township112 when after holding that the amendment in question applied prospectively, the court also supported that holding by citing the revenue s understanding about such prospective application, in a circular. What is of note in that judgment, is that the question of whether circulars or explanatory notes issued by the executive are binding aids of construction was not discussed; more importantly, the court first interpreted the statute, in its own terms, and then cited the circular. 120. That circulars are per se not binding upon courts, in regard to interpretation of a statutory provision and, at best are guides or aid to interpretation for departmental authorities, who are bound to take them into account, was pithily stated in Keshavji Ravji Co. and Ors. v. Commissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the case of Ellerman Lines Ltd. v. Commissioner of Income Tax, West Bengal [1971]82ITR913(SC) and the other is K.P. Varghese v. I.T. Officer, Ernakulam [1981]131ITR597(SC) . In both these cases it was assumed that Navnit Lal's case was an authority for the proposition that even if the directions given in the circular clearly deviate from the provisions of the Act, yet, the Revenue is bound by it. These three decisions were repeatedly referred to and relied on in the subsequent decisions in which the issue arose as regards the binding nature of the circulars either under the Income Tax Act or under the Central Excise Act. In between, there was the three Judge Bench decision in Sirpur Paper Mills Ltd. v. Commissioner of Wealth Tax [1970]77ITR6(SC) in which Section 13 of the Wealth Tax Act corresponding to Section 5(8) of the Income Tax Act, 1922 fell for consideration. This Court took the view that the instructions issued by the Board may control the exercise of the power of the departmental officials in matters administrative but not quasi-judicial. There is yet another decision of a three Judge Bench which seems to make a dent on the weight of the proposition that the circul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clause 124. Section 2 of the Income Tax Act opens with the phrase unless the context otherwise requires . It has been held in S.K. Gupta Anr. v. K.P. Jain Anr.115 that where the definition of a term is preceded by this phrase, normally, the definition given in the section should be applied and given effect to but this normal rule can be deviated if there is something in the context to show that the definition should not be applied . This rule was also adopted in Indira Nehru Gandhi v. Shri Raj Narain and Anr.116 by Khanna, J and in Kalya Singh v. Genda Lal and Ors117. Previously, in Vanguard Fire and Insurance Company Ltd. v. M/s. Fraser and Ross and Anr.118, it was held that the term unless the context otherwise requires implies that the word or term so defined should be applied subject to the context. It was held that in view of such a qualification, the Court has not only to look at the words but also to look at the context, collocation, and the object of such words in respect of such matters and factor the meaning to be conveyed by the use of the words under the circumstances. Almost the same reasoning has been echoed in N.K. Jain and Ors. v. C.K. Shah and Ors119. 125. The imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Surat Art Silk (supra) which had ruled that: (i) A GPU category charity with a constitution granting discretion to the trustees to engage in charitable and non-charitable activities, could not claim the exemption; (ii) The main or dominant purpose of the GPU category charity had to be essentially charitable. If it was so, and it incidentally entailed carrying on activities that led to profit, it was entitled to exemption. 128. This court s understanding of the law as expressed in Thanthi Trust was therefore, coloured by the statute as it existed, and the formulation in Surat Art Silk (supra). As a result, Thanthi Trust, interpreted Section 11(4A) in this background and held that the assessee in that case incidentally was engaged in activities for profit. The court was also of the opinion that Section 11(4A) was wider than the revenue urged it to be, in that activities by way of business could not be carried on incidentally by a Trust, which otherwise was a GPU category trust. 129. As noticed earlier, between Surat Art Silk (supra) and the decisions rendered thereafter (i.e., Bar Council of Maharashtra, Federation of Indian Chamber of Commerce and Industries and Thanthi Trust) th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ention to continue the activity of carrying on the transactions for a profit. But no single test or group of tests is decisive of the intention to carry on the business. 132. The term in relation to was interpreted in Renusagar Power Co. Ltd. v. General Electric Co.124 in an arbitration clause - as follows: 25... (2) Expressions such as arising out of or in respect of or in connection with or in relation to or in consequence of or concerning or relating to the contract are of the widest amplitude and content.. In Mansukhlal Dhanraj Jain v. Eknath Vithal Ogale125 this court underlined the amplitude to the term relating to : 16. It is, therefore obvious that the phrase relating to recovery of possession as found in Section 41(1) of the Small Cause Courts Act is comprehensive in nature and takes in its sweep all types of suits and proceedings which are concerned with the recovery of possession of suit property from the licensee and, therefore, suits for permanent injunction restraining the Defendant from effecting forcible recovery of such possession from the licensee-Plaintiff would squarely be covered by the wide sweep of the said phrase. In Doypack System (P) Ltd. v. Union of India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce Act, 2012 this was enhanced to ₹25,00,000. 135. The next important change took place through the Finance Act, 2015, which, w.e.f. 01.04.2016 substituted the two provisos to Section 2(15) with the following proviso: Provided that the advancement of any other object of general public utility shall not be a charitable purpose, if it involves 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, 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, unless- (i) such activity is undertaken in the course of actual carrying out of such advancement of any other object of general public utility; and (ii) the aggregate receipts from such activity or activities during the previous year, do not exceed twenty per cent of the total receipts, of the trust or institution undertaking such activity or activities, of that previous year; 136. The limited relief, given by the second proviso, to GPU charities (for the period 2009-2015) was that in case such GPU category charities did carry on ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... way of cess, fee or consideration. In the opinion of this court, the express deletion of the reference to activity for profit on the one hand, and the enactment of an expanded list of what cannot be done by GPU charities if they are to retain their characteristic as charities, is an emphatic manner in which Parliament wished to express itself. 139. Counsel on both sides went to great lengths and cited several judgments for the proposition that trade or business are terms which imply profit-making. They relied on Khoday Distilleries (supra); M/s. Raipur Manufacturing (supra); Board of Trustees of the Port of Madras (supra), and Physical Research Laboratory v. K. G. Sharma128. It was contended by the revenue, that the reference to terms business, trade or commerce and service in relation to such activities are meant to imply that profit motive should be completely absent. At the same time - on behalf of the assessees, it was contented that if the proscribed activities i.e., business, commerce or trade or service in relation to such activities - is not the main or dominant object of the GPU charity, any incidental involvement in such activities is permissible. Counsel on behalf of ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of and the intention underlying the proviso than to find a label for it. It is clarificatory in nature without a doubt; it appears to be more indeed. It is concerned mainly with the income (of Provincial Governments) referred to in the main limb of sub-section (1). It speaks of tax on the lands or buildings in that context alone, as we shall explain in the next paragraph. The idea underlying the proviso is to make it clear that the exemption of income of Provincial Government operates only where the income is earned or received by it as a Government; it will not avail where the income is earned or received by the Provincial Government on account of or from any trade or business carried on by it - that is a trade or a business carried on with profit motive. In the light of the language of the proviso to Section 155 and clause (2) of Article 289, it is not possible to say that every activity carried on by the Government is governmental activity. A distinction has to be made between governmental activity and trade and business carried on by the Government, at least for the purposes of this clause. It is for this reason, we say, that unless an activity in the nature of trade and busi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from union taxation, in the context of Article 289. The court also emphasized that mere sale or lease of government property does not imply trade or business. The crucial or determinative element in the venture, so to say, is whether performance of a function is actuated by profit motive. 142. What then is the true meaning of the expressions fee, cess or consideration ? The careful analysis of the amended proviso to Section 2(15), reveal that the prohibition applies in a four-fold manner- (a) The bar to engaging in trade, commerce or business, (b) The bar to providing any service in relation to trade, commerce or business, (c) wherein for a fee, cess or any other consideration is the controlling phrase for both (a) and (b) (which are collectively referred to as prohibited activities for brevity) (d) irrespective of the application of the income derived from such prohibited activities . 143. The impermissibility of any trade, or commercial activity or service, and income, from them, was intended to be conveyed through the prohibition, in the first part of the definition of GPU charities. The necessary implication which arises is that income (received as fee, cess, or any other consi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess . In Shinde Brothers Etc. v. Deputy Commissioner, Raichur and Ors.131, Justice M. Hidyatullah, (though his was a dissenting judgment, yet no contrary opinion was expressed by majority in regard to cess ) said that: ... The word cess is used in Ireland and is still in use in India although the word rate has replaced it in England. It means a tax and is generally used when the levy is for some special administrative expense which the name (health cess, education cess, road cess etc.) indicates. When levied as an increment to an existing tax, the name matters not for the validity of the cess must be judged of in the same way as the validity of the tax to which it is an increment. By Schedule A(1) read with Section 3 of the Act, it is collected as an additional levy with a tax, which, as described in Schedule A, is undoubtedly one within the powers of the State Legislature and has been so even prior to the Constitution.... 146. The seven-judge bench judgment of this court in India Cement Ltd. Ors. v. State of Tamil Nadu and Ors.132, approved the definition propounded by Hidayatulla, J. In Vijayalashmi Rice Mill and Ors. v. Commercial Tax Officers, Palakol Ors133 this court observed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fit accruing to the one party, or some forbearance, detriment, loss or responsibility, given, suffered or undertaken by the other, as observed in the case of Currie v. Misa (1875) LR 10 Ex. 153. 54. Webster's Third New International Dictionary (unabridged) defines, consideration thus: Something that is legally regarded as the equivalent or return given or suffered by one for the act or promise of another. 55. In volume 17 of Corpus Juris Secundum (p.420-421 and 425) the import of 'consideration' has been described thus: Various definitions of the meaning of consideration are to be found in the text-books and judicial opinions. A sufficient one, as stated in Corpus Juris and which has been quoted and cited with approval is a benefit to the party promising or a loss or detriment to the party to whom the promise is made..... At common law every contract not under seal requires a consideration to support it, that is, as shown in the definition above, some benefit to the promisor, or some detriment to the promisee. 56. In Salmond on Jurisprudence, the word 'consideration' has been explained in the following words. A consideration in its widest sense is the reason, mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... activity, then, notwithstanding their nomenclature (as fee or cess, i.e. that they are fixed under a law) the GPU charity cannot claim tax exempt status. To bring home this even more pointedly- and underline a break from the past, the application of such amounts (received in the course of trade, commerce, or business, or towards services in relation thereto) would be irrelevant, as evidenced by the term irrespective , in the fourth limb of reading Section 2(15). Summation of interpretation of Section 2(15) 152. Section 2(15) - in the wake of its several amendments between 2008 and 2015 - can be juxtaposed with the interpretation of the unamended Section 2(15) by this Court. In Surat Art Silk (supra), the principle enunciated was that so long as the predominant object of GPU category charity is charitable, its engagement in a non-charitable object resulting in profits that are incidental, is permissible. The court also declared that profits and gains from such activities which were non-charitable had to be deployed or fed back to achieve the dominant charitable object. 153. The paradigm change achieved by Section 2(15) after its amendment in 2008 and as it stands today, is that firs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said trusts. Section 12 enacts that income of trusts created wholly for charitable or religious purpose from voluntary contributions would be deemed as income from the property held under such trust for the purposes of Sections 11 and 13 of the Act. Section 12-A prescribes the conditions for applicability of Sections 11 and 12 of the Act. It enacts two essential conditions which are to be satisfied by a charitable or religious trust for claiming exemption under those sections: firstly, that the person in receipt of the income has made an application for registration of the trust on or after 01.06.2007 in the prescribed form and manner to the Commissioner and such a trust is registered under Section 12-AA and secondly, where the total income of the trust exceeds the maximum amount which is not chargeable to income tax in any previous year, the accounts of the trust must be audited by a chartered accountant and the person in receipt of the income should furnish such audit report in the prescribed form along with the return of income. The procedure for grant (or refusal) of registration is prescribed by Section 12AA. Section 13 enlists the circumstances under which tax exemption is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trust or an institution, being profits and gains of business, unless the business is incidental to the attainment of the objectives of the trust or, as the case may be, institution, and separate books of account are maintained by such trust or institution in respect of such business. 158. The question whether Section 11(4A) applies where a business is held under trust was answered in the negative in earlier High Court judgments. The general provision under Section 4(3)(i) of the old Act exempted income derived from property held under trust from taxation. Section 4(3)(ia) however, enacted that any income derived from a business carried on behalf of a religious or charitable trust would be entitled to exemption only if the business was carried on in the course of carrying out of a primary purpose of the trust or the work in connection with the business is mainly carried on by the beneficiaries of the trust. The revenue contended there that since clause (ia) was a special provision dealing with exemption in respect of a business carried on for and on behalf of a trust, any claim for exemption as regards the profits of such business can be made only under that provision, and if condit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r trust. There is a difference between a property or business held under trust and a business carried on by or on behalf of the trust. This distinction was recognized in Surat Art Silk (supra), which observed that if a business undertaking is held under trust for a charitable purpose, the income from it would be entitled to exemption under Section 11(1) of the Act. 161. The interface between Sections 11(1) and (4) is of some importance. Firstly, under Section 11(4), it is only the business which is held under the trust that would enjoy exemption in respect of its income under Section 11(1). Secondly, there is a distinction between the objects of a trust and the powers given to the trustees to effectuate the purposes of the trust. In this regard, the observations of this court, in J.K. Trust (supra) assume relevance. There, one of the questions which arose was whether the office of managing agency, which was an office of profit, was in fact settled upon trust and, therefore, could be considered to be business held under trust. The court held that for the purposes of Section 4(3)(i) of the 1922 Act, the office of managing agency was property which could be held under trust. The reven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f is held under trust or is carried on by and on behalf of the trust. Importantly Section 11(1) of the Act starts with the expression subject to the provisions of Sections 60 to 63........ . Those provisions are in Chapter V of the Act. Section 60 provides for the consequences of a transfer of income where there is no transfer of assets. It says that where a person transfers merely the income from an asset without transferring the asset itself, he would continue to be chargeable to income tax. Section 61 provides for the consequences of a revocable transfer of assets and says that the same would be the position where a person is in receipt of income by virtue of a revocable transfer of assets. Section 62 provides for the consequences of a transfer of assets for a specified period, and serves as an exception to Section 61. An assessee has to be divested of the asset before ceasing to be assessable in respect of the income from it. A mere direction that the income from the business shall be applied to the charitable objects of a trust, without there being a settlement of the business itself upon trust, does not result in any trust or legal obligation. 164. It is now, necessary to con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thi Trust to mean that the carrying on of business by GPU charity was permissible as long as it inured to the benefit of the trust. The change brought about by the amendments in questions, however, place the focus on an entirely different perspective: that if at all any activity in the nature of trade, commerce or business, or a service in the nature of the same, for any form of consideration is permissible, that activity should be intrinsically linked to, or a part of the GPU category charity s object. Thus, the test of the charity being driven by a predominant object is no longer good law. Likewise, the ambiguity with respect to the kind of activities generating profit which could feed the main object and incidental profit-making also is not good law. What instead, the definition under Section 2(15) through its proviso directs and thereby marks a departure from the previous law, is firstly that if a GPU charity is to engage in any activity in the nature of trade, commerce or business, for consideration it should only be a part of this actual function to attain the GPU objective and, secondly and the equally important consideration is the imposition of a quantitative standard - i. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such exemption with conditions. The seventh proviso - much like Section 11(4A) and the definition - carve out an exception, to the exemptions such that income derived by charities from business, are not exempt. The seventh proviso virtually echoes Section 11(4A) in that business income derived by a charity (in the present case, the GPU charities) which arises from an activity incidental to the attainment of its objective is not per se excluded. 170. Classically, the idea of charity was tied up with eleemosynary143. However, charitable purpose and charity as defined in the Act have a wider meaning where it is the object of the institution which is in focus. Thus, the idea of providing services or goods at no consideration, cost or nominal consideration is not confined to the provision of services or goods without charging anything or charging a token or nominal amount. This is spelt out in Indian Chamber of Commerce (supra) where this Court held that certain GPUs can render services to the public with the condition that they would not charge more than is actually needed for the rendering of the services, - may be it may not be an exact equivalent, such mathematical precision being ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such case, the receipts from such latter kind of activities where higher amounts are charged, should not exceed the limit indicated by proviso (ii) to Section 2(15). 174. The insertion of Section 13(8)144, the seventeenth proviso to Section 10(23C) and third proviso to Section 143(3) (all of which were inserted by Finance Act, 2012, but w.r.e.f. 01.04.2009), further reinforces the interpretation of this Court, of charitable purpose . These provisions, form the machinery to control the conditions under which income is exempt. The effect of the seventeenth proviso to Section 10(23C) is to impose the same condition i.e., that that the trade, commerce or business activity or service relating to trade, business or commerce, should be part of the GPU s activities, to achieve its object of advancing general public utility. The other condition which is drawn in as part of the exemption condition, is that if such trading or commercial activity takes place the receipts should be confined to a prescribed percentage of the overall receipts. Section 13(8) too reinforces the same condition. 175. In the opinion of this court, the change intended by Parliament through the amendment of Section 2(15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acterized as commercial receipts . The rationale for such exclusion would be that if such rates, fees, tariffs, etc., determined by statutes and collected for essential services, are included in the overall income as receipts as part of trade, commerce or business, the quantitative limit of 20% imposed by second proviso to Section 2(15) would be attracted thereby negating the essential general public utility object and thus driving up the costs to be borne by the ultimate user or consumer which is the general public. By way of illustration, if a corporation supplies essential food grains at cost, or a marginal mark up, another supplies essential medicines, and a third, water, the characterization of these, as activities in the nature of business, would be self-defeating, because the overall receipts in some given cases may exceed the quantitative limit resulting in taxation and the consequent higher consideration charged from the user or consumer. (a) Interpretation of Section 10(46) and Section 2(15) 178. Section (20A) was inserted by Finance Act, 1970 with effect from 01.04.1962. It had excluded certain classes of income, of corporations145. This court had occasion to deal with t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iption of a body under that provision, that ipso facto is not a bar for it to claim benefit of another provision. 181. Section 10(46) re-incarnated so to say Section 10(20A), which had been deleted w.e.f. 01.04.2003. This provision, i.e., Section 10(46) was inserted with effect from 01.04.2009 retrospectively by the Finance Act, 2011146. The conditions for applicability of Section 10(46), i.e., that specified income or a class of specified income of ports, trusts or commissions, etc., established or constituted by or under Central or State enactments with the object of regulating or administering any activity in the general public, is on similar lines as in the case of GPU charities. Like in the case of GPU charities, there is a prohibition by Section 10(46)(b) against such corporations, etc. engaging in commercial activity. This restriction has been introduced for the first time [as that prohibition was absent in the now repealed Section 10 (20A)]. 182. The term commercial is closely similar to, if not identical, with the phrase in the nature of trade, commerce or business. The other condition in Section 10(46) is that the specified income to be exempted, is to be notified by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, activities for profit or activities which clearly were motivated by profit carried on by government or statutory bodies, cannot avail of exemption. The judgment in Yamuna Industrial Development Authority (supra) is along the similar lines. 185. As far as boards and corporations which are tasked with development of industrial areas, by statute, the judgments of this court, in Shri Ramtanu Cooperative Housing Society (supra) and Gujarat Industrial Development Corporation (supra) have declared that these bodies are involved in development and are not essentially engaged in trading. In Shri Ramtanu Cooperative Housing Society (supra) this court, by a five judge bench, held that the Maharashtra Industrial Development Corporation is not a trading concern, and observed as follows: These features of transfer of land, or borrowing of moneys or receipt of rents and profits will by themselves neither be the indicia nor the decisive attributes of the trading character of the Corporation. Ordinarily, a Corporation is established by shareholders with their capital. The shareholders have their Directors for the regulation and management of the Corporation Such a Corporation set up by the shar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tate Government. These provisions in regard to the finance of the Corporation indicate the real role of the Corporation viz. the agency of the Government in carrying out the purpose and object of the Act which is the development of industries. If in the ultimate analysis there is excess of income over expenditure that will not establish the trading character of the Corporation. There are various departments of the Government which may have excess of income over expenditure. ************** ******** ********* 20. The underlying concept of a trading Corporation is buying and selling. There is no aspect of buying or selling by the Corporation in the present case. The Corporation carries out the purposes of the Act, namely, development of industries in this State. The construction of buildings, the establishment of industries by letting buildings on hire or sale, the acquisition and transfer of land in relation to establishment of industrial estate or development of industrial areas and of setting up of industries cannot be said to be dealing in land or buildings for the obvious reason that the State is carrying out the objects of the Act with the Corporation as an agent in setting up i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has broader import. In a sense, the newly added Section 10(46), resembles a GPU category charity classified under Section 2(15). The second distinction is that Section 10(20A) did not bar any board, or corporations, etc. from indulging in commercial activities. However, sub-clause (b) of Section 10(46) imposes such a bar, and the concerned body cannot claim tax exemption if it engages in commercial activity. 188. The manner in which GPU charities has been dealt with under the definition clause, i.e., Section 2(15), indicates that even though trading or commercial activity or service in relation to trade, commerce or business appears to be barred nevertheless the ban is lifted somewhat by the proviso which enables such activities to be carried out if they are intrinsically part of the activity of achieving the object of general public utility. Furthermore, in the case of GPU charities there is a quantified limit of the overall receipts, which is permissible from such commercial activity. In the case of local authorities and corporations covered by Section 10(46) no such activities are seemingly permitted. 189. As was observed in the earlier part of this judgment while considering wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny activity in the general public interest, supply of essential goods or services - such as water supply, sewage service, distributing medicines, of food grains (PDS entities), etc.; (b) While carrying on of such activities to achieve such objects (which are to be discerned from the objects and policy of the enactment; or in terms of the controlling instrument, such as memorandum of association etc.), the purpose for which such public GPU charity, is set-up - whether for furthering the development or a charitable object or for carrying on trade, business or commerce or service in relation to such trade, etc.; (c) Rendition of service or providing any article or goods, by such boards, authority, corporation, etc., on cost or nominal mark-up basis would ipso facto not be activities in the nature of business, trade or commerce or service in relation to such business, trade or commerce; (d) where the controlling instrument, particularly a statute imposes certain responsibilities or duties upon the concerned body, such as fixation of rates on pre-determined statutory basis, or based on formulae regulated by law, or rules having the force of law, setting apart amenities for the purposes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... U charity. If in the course of its functioning it collects fees, or any consideration that merely cover its expenditure (including administrative and other costs plus a small proportion for provision) - such amounts are not consideration towards trade, commerce or business, or service in relation thereto. However, amounts which are significantly higher than recovery of costs, have to be treated as receipts from trade, commerce or business. It is for those amounts, that the quantitative limit in proviso (ii) to Section 2(15) applies, and for which separate books of account will have to be maintained under other provisions of the IT Act. (ii) Statutory regulatory bodies/authorities 191. During the hearings, rival contentions were made in regard to the facial nature of the public utility character of regulatory bodies. A sample special case was that of the Institute of Chartered Accountants of India (ICAI). In respect of some years, the revenue has preferred appeals and in respect of some others, the Institute has preferred appeals. Reliance was placed upon the provisions of the ICAI Act and detailed submissions were made to emphasise that it plays a pivotal role in regulating the ent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvices in relation to trade, commerce or business squarely falls within the mischief of Section 2(15), which has to preclude the institute s claim for exemption as a GPU charity. 194. The Institute is a creature of the Institute of Chartered Accountants Act, 1949. By Section 4 of this Act, every person who qualifies in the examination conducted by the Institute has to seek registration as a Chartered Accountant. Only when members obtain certificates issued by the Council of the Institute under Section 6 can they be known as a Chartered Accountant and be entitled to practice that profession (Sections 6 and 7). The Council of the Institute is constituted under Section 9 which defines such constitution and the manner for holding elections, etc. The functions of the Council by Section 15(2A) include approving the academic courses and their contents, examining the candidates, regulation and articleship assistance, prescribing qualification for entry of persons in the register, collection of fees from members; the regulation and maintenance and status of the professional qualifications of the members of the Institute, etc. By Section 15A, universities are enabled to impart education on s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essions (including the profession of Cost and Work Accountants, and Company Secretary, etc.) is the powers conferred upon them by the statutes to prescribe standards and enforce them through disciplinary sanctions. Therefore, it is held that bodies which regulate professions and are created by or under statutes which are enjoined to prescribe compulsory courses to be undergone before the individuals concerned is entitled to claim entry into the profession or vocation, and also continuously monitor the conduct of its members do not ipso facto carry on activities in the nature of trade, commerce or business, or services in relation thereto. 197. At the same time, this court would sound a note of caution. It is important, at times, while considering the nature of activities (which may be part of a statutory mandate) that regulatory bodies may perform, whether the kind of consideration charged is vastly or significantly higher than the costs it incurs. For instance, there can be in given situations, regulatory fees which may have to be paid annually, or the body may require candidates, or professionals to purchase and fill forms, for entry into the profession, or towards examinations. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s is whether the change in definition impacts the claims of trade promotion bodies, federations of commerce, or such organizations, that they are GPU charities . The judgment in Surat Art Silk (supra) proceeded on the assumption that trade promotion was the pre-dominant object of the GPU charity before the court, and that other objects including procuring licences, trade etc. were incidental. The assessee in Surat Silk had clear trading objects: (b) To carry on all and any of the business of Art Silk Yarn, Raw Silk, Cotton Yarn as well as Art Silk f loth, Silk Cloth and Cotton Cloth belonging to and on behalf of the members. ********* ********** (e) To buy and sell and deal in all kinds of cloth and other goods and fabrics belonging to and on behalf of the Members. This court, nevertheless, held that since the predominant object of the assessee was trade promotion, while furthering it, the fact that some trading occurred, leading to income, did not preclude the assessee from claiming tax exemption. 202. In the opinion of this court, the change in definition in Section 2(15) and the negative phraseology - excluding from consideration, trusts or institutions which provide services in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese services, i.e., booking and providing space, AEPC charges rentals. Now, these rents are not towards fixed assets owned by it. They are in fact charges, or fees, towards services in relation to business; likewise, the skill development and diploma courses conducted by it, for which fees are charged, are to improve business functioning of garment exporters. Furthermore, market surveys and market intelligence, especially country specific activities, aimed at catering to specified exporters, or specified class of exporters, is also service in relation to trade, commerce or business. 205. In the circumstances, it cannot be said that AEPC s functioning does not involve any element of trade, commerce or business, or service in relation thereto. Though in some instances, the recipient may be an individual business house or exporter, there is no doubt that these activities, performed by a trade body continue to be trade promotion. Therefore, they are in the actual course of carrying on the GPU activity. In such a case, for each year, the question would be whether the quantum from these receipts, and other such receipts are within the limit prescribed by the sub-clause (ii) to proviso t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... charges, and registration charges) are of such nature as to be called as fees or consideration towards business, trade or commerce, or service in relation to it. The functions ERNET performs are vital to the development of online educational and research platforms. For these reasons, it is held that the impugned judgment, which upheld the ITAT s order, does not call for interference. 209. The Revenue has appealed the decision of Delhi High Court in which the National Internet Exchange of India (NIXI) was held to be a GPU category charity. The materials on record show that NIXI was established in 2003 under the aegis of the Ministry of Information Technology of the Union Government for the promotion and growth of internet services in India, to regulate the internet traffic, act as an internet exchange, and undertake .in domain name registration. Concededly, NIXI, is a not for profit, and is barred from undertaking any commercial or business activity. Its object is to promote the interests of internet service providers and internet consumers in India, improve quality of internet service, save foreign exchange, and carry on domain name operations. It is bound by licensing conditions w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it with wide ranging benefits and advantages which facilitate tracking, tracing of the product, product recalls, counterfeit detection, user safety due to accuracy, wastage control through accurate monitoring and stock levels for commodities, security and safety of supply chains, detection of illegal trade, etc. The unique identification or coding system developed and operated by GS1 International or GS1 India is recognized and accepted globally. Additionally, the unique identification code can be enabled with RFID chip and other electronic technology. Being one of its kinds globally, only a GS1 registered organization can set up and promote the said system/standard within a country. These can be used for several fields including public distribution system, agriculture, health products, etc. and has been successfully used for product package labels. The utility and benefits of a universal coding system assessable by anyone across the globe, for the consumers, government, manufacturers, traders, exporters, etc. are enormous and significant. Initial registration fee of ₹ 20,000/- is charged by GS1, plus annual fee of ₹4,000/- (enhanced to ₹ 5,000/- from financial ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the years. It was pointed out that according to the balance sheet the aggregate registration fees receipt for the year ending 31.03.2007 was ₹1,80,80,760/- whereas for the year ending 31.03.2008 which had increased to ₹4,85,47,170/-. Likewise, membership fees had increased from ₹44,40,000/- as on 31.03.2007 to ₹93,42,500/-. Furthermore, renewal fees for the year ending 2007 was ₹1,68,57,200/- whereas for the next year i.e., as on 31.03.2008 it was ₹1,90,50,650/-. The Revenue submitted that even where income and interest were to be excluded, the increase on a yearly basis was exponential. Likewise, it was pointed out that registration fees as on 31.03.2011 was ₹4,24,69,850/- whereas as on 31.03.2012 it was ₹6,07,58,100/-; subscription fee as on 31.03.2011 was ₹1,02,06,720/-; for the next year i.e., on 31.03.2012 it was ₹1,01,69,850/-. Likewise, the subscription renewal fees as on 31.03.2011 was ₹4,18,62,804/- and the same head as on 31.03.2012 was ₹4,46,71,134/-. 216. The Revenue emphasises the fact that GS1 is a monopolist organization, has exclusive licenses in relation to bar coding technology which it admi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cket in the area under its jurisdiction. The association can also undertake any other and all activities which may be beneficial to it. GCA s objects include activities aimed at creating, fostering and maintaining friendly and cordial relationship through sports tournaments and competitions, to create a healthy spirit through the medium of sports in general, and cricket in particular. The other objects include: to instil the spirit of sportsmanship in school and college students, members of other institutions, and other citizens; instil the ideals of cricket and educate them in the same; to select teams to represent the association in any competitive forum; to arrange, supervise, hold, encourage and finance visits of teams; to arrange or manage league and/or any other tournaments; to promote persons, meetings, competitions and matches in relation to sports; and to offer, give/distribute or contribute towards prizes, medals and awards; to lay out grounds for playing the game; and to provide pavilion, stadia, other conveniences and amenities in connection therewith. The GCA also includes within its objects, providing coaching to deserving persons in the various departments of the gam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sits India, the international matches such as Test and ODI are allotted by BCCI to the State Cricket Associations by a rotation policy. The matches are conducted and managed by the respective state associations and over time, arrangements have evolved about the respective responsibilities, rights, shares of revenue etc. These have evolved in order to promote co-operation and unity among the member associations and by applying the principles of equity and fairness, for which the sport of cricket is renowned. 9.7.3 The BCCI in its submission dated 21/1/2013 earned subsidy paid to SCAs and TV Subvention as stated as follows:- 13.2 PAYMENTS TO STATE ASSOCIATIONS During the year, BCCI has paid amounts to the state associations under the head TV, Subventions to Associations . This represents payment of 70% of the revenue from sale of media rights to the state associations . Whenever a foreign team visits India, the international matches such as Test and ODI are allotted by BCCI to the state cricket associations by a rotation policy. The matches are conducted and managed by the respective state associations. It is not possible for BCCI to conduct all these matches with its own limited per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... higher revenues from media rights. ************* **************** Even in the event that exemption under section 11 is denied, the payments to state associations must be allowed as a deduction, as expenditure laid out or expended wholly and exclusively for the purpose of earning such income, it must be appreciated that in order to earn revenues, BCCI was and continues to be highly dependent on the state associations. BCCI does not have the infrastructure and the resources to conduct the matches by itself and is dependent on the state associations to conduct the matches. The income from media rights is dependent on the efforts of the state associations in conducting the matches from which the media rights accrue. The division of revenues and expenditure is a matter of arrangement between the parties. Certain incomes such as sale of ticket revenues belong to the state associations, who meet the expenditure on the matches such as security for players and spectators temporary stands, operation of floodlights, Score Boards, management of crowd, insurance for the match, electricity charges, catering etc. Whereas with regard to the income from sale of media rights, the arrangement betwee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t permit. We are not really concerned, at this stage, whether the allegations about commercialization of cricket by the BCCI are correct or not, because that aspect of the matter would be relevant only for the purpose of proviso to Section 2(15) being invoked in the hands of the BCCI. We do not wish to deal with that aspect of the matter or to make any observations which would prejudge the case of the BCCI. Suffice to say that the very foundation of revenue's case is devoid of legally sustainable basis for the short reason that the commercialization of cricket by the BCCI, even if that be so, cannot be reason enough to invoke the proviso to Section 2(15). We are alive o learned Commissioner (DR)'s suggestion that the cricket associations cannot be seen on standalone basis as the BCCI is nothing but an apex body of these cricket associations at a collective level and whatever BCCI does is at the behest of or with the connivance of the local cricket associations, and that it is not the case that anyone can become a Member of the BCCI because only a recognized cricket association can become a Member of the BCCI. We are also alive to learned Commissioner's argument that wha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... du Cricket Association v. Director of Income Tax (Exemptions) Ors.153, and held 54. The assessee is a member of the Board of Control for Cricket in India (BCCI), which in turn is a member of ICC (International Cricket Council). BCCI allots test matches with visiting foreign team and one day international matches to various member cricket associations which organise the matches in their stadia. The franchisees conduct matches in the stadia belonging to the State cricket association. The State association is entitled to all in-stadia sponsorship advertisement and beverage revenue and it incurs expenses for the conduct of the matches. BCCI earns revenue by way of sponsorship and media rights as well as franchisee revenue for IPL and it distributes 70 per cent, of the revenue to the member cricket association. Thus, the assessee is also the recipient of the revenue. Thus, for invoking section 12AA read with section 2(15) of the Act, the Revenue has to show that the activities are not fitting with the objects of the association and that the dominant activities are in the nature of trade, commerce and business. We do not think that by the volume of receipt one can draw the inference that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se rights was by the BCCI, the lion s share of those amounts was that of the respective state associations. Furthermore, the state associations owned the stadia, and actually conducted the matches, in respect of which stadium advertisements and sponsorship amounts were received: these, too, were in the nature of business or commercial activities. The assessees on the other hand, submitted that they are distinct from the BCCI. It was sought to be urged that the activity of sports and sport promotion is basically education, and hence, per se exempt. Realizing the value of inculcating sportsmanship and fostering the culture of sport, Parliament had introduced Section 10(23), to exempt income received by sports bodies. However, that was deleted w.e.f. 01.04.2003. It was argued that this does not preclude sports bodies, like cricket associations from claiming to be charities. It was urged that even if the court were not to consider the cricket associations to be education-related charities, they cannot be denied the status of GPU charities, having regard to the sports promotional nature of their objects. It was submitted that these bodies are primarily responsible for fostering the spor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urth limb of Section 2(15) i.e., GPU category, if it is to make a case for tax exemption. 226. BCCI is the body which regulates cricket and represents the country. Within the country it organizes and conducts the Ranji Trophy, the Irani Trophy, the Duleep Singh Trophy, the Deodar Trophy and the NKP Salve Challenge Trophy. These are domestic events, yet only those who are members of the Board and/or recognized by it can take part in these events. The members of the Board (entitled to vote in its election) are the state cricket associations.154 The BCCI is the country-level cricket regulator both off and on the fields, and its functions include selection of players and umpires. The International Cricket Council (of which BCCI, as the representative body of the country, is a member) possesses and exercises all the powers to regulate international competitive cricket. It also exercises disciplinary power in case of violation of the rules, a country member or the player may be derecognized. The ICC exercises a monopoly over the sports at the international level whereas BCCI does so at the country level. BCCI recognizes bodies which are entitled to participate in the nominated tournament ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, and leading to higher revenues from media rights. 229. These media, or broadcasting rights, are in the nature of intellectual property rights: under Section 37 to 40 of the Copyrights Act, 1957. These rights- especially television and digital rights enable the licensee or the successful bidder to exploit the telecast or broadcast commercially, by carrying advertisements of various products and services, in the media. Given that (i) BCCI does not own the stadia, and uses the entire physical infrastructure of the state associations (ii) expressly negotiates on their behalf for the sale of such rights (which appear to be purely commercial contracts), the associations assertions that they only received subsidy from BCCI, needed closer examination. 230. The income and expenditure account for the year ending on 31.03.2009 shows that the total income of the GCA was ₹4,03,98,736.81. Of these sponsorship money was ₹20,00,000/-; bank interest was ₹2,21,88,527.05 and as against the head India v. South Africa test match , the sum of ₹1,51,97,741/- has been shown. Of the total of ₹2,21,02,441.45 shown as income, ₹32,24,591.25 is shown as expenditure, only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the several matches they host. Many such matches are not at national level and are under-16 or under-18 matches at the regional level. However, these activities are not to be seen in isolation but are to be regarded as part of the overall scheme, and ecosystem in which the game of cricket is organized in India. Talent is spotted, at local levels and dependent on the promise shown, given appropriate exposure. 235. On a close scrutiny of the expenses borne, having regard to the nature of receipts, the expenditure incurred by Cricket Associations does not disclose that any significant proportion is expended towards sustained or organized coaching camps or academies. Therefore, in the opinion of this court, the ITAT fell into error in not considering the nature of receipts flowing from the BCCI into the corpus of GCA and SCA as well as other associations that are before this court- to determine their true character. The ITAT appears to have been swayed by the submission that the amount given by the BCCI were towards capital subsidy. 236. To determine whether a given receipt is to be characterized as falling in the revenue or capital stream, the objective for which it is given as well a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n to carefully examine and see the pattern of receipts and expenditure. Whilst doing so, the nature of rights conveyed by the BCCI to the successful bidders, in other words, the content of broadcast rights as well as the arrangement with respect to state associations (either in the form of master documents, resolutions or individual agreements with state associations) have to be examined. It goes without saying that there need not be an exact correlation or a proportionate division between the receipt and the actual expenditure. This is in line with the principle that what is an adequate consideration for something which is agreed upon by parties is a matter best left to them. These observations are not however, to be treated as final; the parties contentions in this regard are to be considered on their merit. (vi) Private trusts (a) Tribune Trust 239. The Tribune Trust was constituted pursuant to a will executed by late Sardar Dial Singh Majithia. In clause (xxi) of his Will after nominating three trustees, the testator directed that they ought to maintain a press and a newspaper; in clause (xx) the testator directed that his property in the Tribune Press and newspaper would vest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vidual through profit sharing or otherwise, nor distributed for any purpose other than the activities of the Trust. It was submitted that the High Court s surmise that the accumulation of large profits and its assumption that the Trust could utilize them for non-charitable purposes in future, was unfounded. In this regard, it was submitted that till 2008-09 all assessments were completed, since the Revenue was satisfied that more than 85% had been ploughed back to feed the main charitable activity. 243. It is noticed from the impugned judgment that the High Court concedes to the fact that the trust s activities were held by the Privy Council to constitute financing of objects of general public utility ; further that merely because thousands of newspapers were being published made no difference. It still continues to be a GPU charity. 244. The question then is whether the nature of receipts and income garnered by the Trust, in the course of actually carrying out its activity of publishing newspaper, can be characterized as in the nature of trade, commerce or business or service in relation to trade, commerce or business , for any consideration. During the course of submissions, it w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he judgment needs no interference. (b) Shri Balaji Samaj Vikas Samiti 247. The revenue appeals a decision of the Allahabad High Court157 affirming the order of the ITAT which had directed the CIT to grant registration under Section 12AA of the Income Tax Act. 248. The assessee is a registered society which was formed with the object of establishing and running a health club, Arogya Kendra; its object included organization of emergency relief centres, etc. Other objects, included promotion of moral values, eradication of child labour, dowry, etc. The assessee had entered into arrangements with the state agencies to supply mid-day meals to students of primary schools in different villages through contracts entered into with the Basic Shiksha Adhikari, District Meerut. It is a matter of record that the materials for preparation of mid-day meal was supplied by the government. The assessee society claimed that it only obtains nominal charges for preparation of mid-day meals. The assessee s claim for registration was rejected on the ground that it was involved in commercial activity. Upon appeal, the ITAT agreed with the assessee that supply of mid-day meals did not constitute business o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d have remitted the matter for consideration. However, it is apparent from the records that the tax effect is less than Rs.10 lakhs. It is apparent that the receipt from the activities in the present case did not exceed the quantitative limit of Rs.10 lakhs prescribed at the relevant time. In the circumstances, the impugned order of the High Court does not call for interference. IV. Summation of conclusions 253. In view of the foregoing discussion and analysis, the following conclusions are recorded regarding the interpretation of the changed definition of charitable purpose (w.e.f. 01.04.2009), as well as the later amendments, and other related provisions of the IT Act. A. General test under Section 2(15) A.1. It is clarified that an assessee advancing general public utility cannot engage itself in any trade, commerce or business, or provide service in relation thereto for any consideration ( cess, or fee, or any other consideration ); A.2. However, in the course of achieving the object of general public utility, the concerned trust, society, or other such organization, can carry on trade, commerce or business or provide services in relation thereto for consideration, provided tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ning, etc.) may resemble trade, commercial, or business activities. However, since their objects are essential for advancement of public purposes/functions (and are accordingly restrained by way of statutory provisions), such receipts are prima facie to be excluded from the mischief of business or commercial receipts. This is in line with the larger bench judgments of this court in Ramtanu Cooperative Housing Society and NDMC (supra). B.2. However, at the same time, in every case, the assessing authorities would have to apply their minds and scrutinize the records, to determine if, and to what extent, the consideration or amounts charged are significantly higher than the cost and a nominal mark-up. If such is the case, then the receipts would indicate that the activities are in fact in the nature of trade, commerce or business and as a result, would have to comply with the quantified limit (as amended from time to time) in the proviso to Section 2(15) of the IT Act. B.3. In clause (b) of Section 10(46) of the IT Act, commercial has the same meaning as trade, commerce, business in Section 2(15) of the IT Act. Therefore, sums charged by such notified body, authority, Board, Trust or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ancement of objects of general public utility. However, if such organisations provide additional services such as courses meant to skill personnel, providing private rental spaces in fairs or trade shows, consulting services, etc. then income or receipts from such activities, would be business or commercial in nature. In that event, the claim for tax exemption would have to be again subjected to the rigors of the proviso to Section 2(15) of the IT Act. E. Non-statutory bodies E.1. In the present batch of cases, non-statutory bodies performing public functions, such as ERNET and NIXI are engaged in important public purposes. The materials on record show that fees or consideration charged by them for the purposes provided are nominal. In the circumstances, it is held that the said two assessees are driven by charitable purposes. However, the claims of such non-statutory organisations performing public functions, will have to be ascertained on a yearly basis, and the tax authorities must discern from the records, whether the fees charged are nominally above the cost, or have been increased to much higher levels. E.2. It is held that though GS1 India is in fact, involved in advancement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on its receipts and income (i.e., whether the amounts charged are on cost-basis, or significantly higher). If it is found that they are in the nature of trade, commerce or business , then it must be examined whether the quantified limit (as amended from time to time) in proviso to Section 2(15), has been breached, thus disentitling them to exemption. 254. In accordance with the foregoing discussion, and summary of conclusions, the numerous appeals are disposed of as follows: (i) The revenue s appeals against the Improvement Trust, Moga158, the Hoshiarpur Improvement Trust159, Bathinda Improvement Trust160, Fazilka Improvement Trust161, Sangrur Improvement Trust162; Patiala Improvement Trust163, Jalandhar Improvement Trust164, Kapurthala Improvement Trust165, Pathankot Improvement Trust166, Improvement Trust, Hansi167, and the Special Leave Petitions filed against the Gujarat Maritime Board168 and Karnataka Water Supply and Drainage Board169 are rejected. (ii) The revenue s appeals against Ahmedabad Urban Development Authority170, the Gujarat Housing Board171, the Gandhinagar Urban Development Authority172, Rajkot Urban Development Authority173, Surat Urban Development Authority174, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... LP (C) No. 6253/2021, SLP(C) No. 19044/2021, D. No. 5806/2021, D. No. 6662/2021 are hereby allowed. (viii) In relation to the private trusts, the appeal filed by the assesseee, Tribune Trust - CA 9380/2017 is dismissed. The revenue s appeal SLP (C) No. 30597/2018, against Shri Balaji Samaj Vikas Samiti is dismissed, on account of low tax effect. 255. This batch of matters is disposed of, in the above terms. Pending applications, if any, are dismissed. Foot Note 23 As amended by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 01.04.1989; Direct Tax Laws (Amendment) Act, 1989, w.e.f. 01.04.1989; substituted by the Direct Tax Laws (Amendment) Act, 1989, w.e.f. 01.04.1990; and further amended by the Finance (No. 2) Act, 1991, w.r.e.f. 01.04.1990; Finance Act, 1992, w.r.e.f. 01.04.1990/w.e.f. 01.04.1992; and Finance Act, 2000, w.e.f. 1-4-2001. 24 Deletion of the expression not involving the carrying on of any activity for profit and the resulting Section 2(15) read as follows: charitable purpose includes relief of the poor, education, medical relief, and the advancement of any other object of general public utility. 26 Gujarat Town Planning and Urban Development Act, 1976 27 Gujarat I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Economic, Social and Cultural Rights, 1966 and relied on Sri. P.G. Gupta v. State of Gujarat Ors. 1995 (1) SCALE 653 - where a Bench of three Judges of this Court had considered the mandate of the human right to shelter and read it into Article 19(1)(e) and Article 21 of the Constitution of India to guarantee the right to residence and settlement. 60 Federation of Chambers of Indian Commerce and Industry; Confederation of Indian Industry; Associated Chambers of Commerce and Industry of India (ASSOCHAM); The Agricultural and Processed Food Products Export Development Authority (APEDA). 61 1965 (1) SCR 614 62 (2010) 4 SCC 378 63 1964 (7) SCR 664 64 ITA No. 78 of 2016 65 Section 3 (2):- The board shall be a body corporate by the name aforesaid having perpetual succession and a common seal with power, subject to the provisions of this Act to acquire, hold and dispose of property, both movable and immovable, and to contract, and may by the said name sue and be sued. 66 Section 20 of the GMB Act 67 Section 83 of the GMB Act 68 Section 25(2) of the GMB Act 69 Section 32 r/w Sections 37-30 of the GMB Act 70 321 ITR 73 (Del) 71 358 ITR 78 (Del) 72 360 ITR 138 (Del) 73 298 ITR (St.) 74 Quot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (i) subject to the orders of the appropriate authorities under the Act, the removal of names from the Register and the restoration to the Register of names which have been removed; (j) the regulation and maintenance of the status and standard of professional qualifications of members of the Institute; (k) the carrying out, by granting financial assistance to persons other than members of the Council or in any other manner, of research in accountancy; (l) the maintenance of a library and publication of books and periodicals relating to accountancy; (m) to enable functioning of the Director (Discipline), the Board of Discipline, the Disciplinary Committee and the Appellate Authority constituted under the provisions of this Act; (n) to enable functioning of the Quality Review Board; (o) consideration of the recommendations of the Quality Review Board made under clause (a) of Section 28B and the details of action taken thereon in its annual report; and (p) to ensure the functioning of the Institute in accordance with the provisions of this Act and in performance of other statutory duties as may be entrusted to the Institute from time to time. 88 (2005) 273 ITR 139 (Guj.) 89 (1992) 195 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Gazette; or (b) the business is carried on by an institution wholly for charitable purposes and the work in connection with the business is mainly carried on by the beneficiaries of the institution, and separate books of account are maintained by the trust or institution in respect of such business. 105 297 U.S. 216 (1936) 106 Cabell v. Markham (1945) 148 F 2d 737 107 2009 (16) SCR 618 108 1979 (1) SCR 26 109 Lohia Machines Ltd. and Ors. v. Union of India Ors 1985 (2) SCR 686; Commissioner of Customs (Import), Mumbai v. Dilip Kumar Company Ors 2018 (9) SCC 1 110 State of West Bengal v. Union of India 1964 (1) SCR 371: A statute, as passed by Parliament, is the expression of the collective intention of the legislature as a whole, and any statement made by an individual, albeit a Minister, of the intention and objects of the Act cannot be used to cut down the generality of the words used in the statute. At the same time, later decisions have relaxed the rigor of this rule. In K.P. Varghese v. Income-tax Officer, 1982 (1) SCR 629, this court, referring to the budget speech of the Minister stated: Now it is true that the speeches made by the Members of the Legislature on the floor o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Corporation 1991 (Supp 1) SCR 183; Municipal Corporation, Amritsar v. Senior Superintendent of Post Offices, Amritsar Division Anr. 2004 (1) SCR 913. 136 2012(12) SCR 975 137 Commissioner of Income Tax v. Dawoodi Bohara Jamat, (2014) 16 SCC 222; S.RM.M.CT.M. Tiruppani Trust v. Commissioner of Income Tax, (1998) 2 SCC 584 138 See Gadodia Swadeshi Stores v. Commissioner of Income Tax, Punjab, (1944) 12 ITR 385 139 1958 (1) SCR 65 140 (1963) 50 ITR 798 Madras. 141 (1957) 31 ITR 226 Patna. 142 Provided also that nothing contained in sub-clause (iv) or sub-clause (v) or sub-clause (vi) or sub-clause (via) shall apply in relation to any income of the fund or trust or institution or any university or other educational institution or any hospital or other medical institution, being profits and gains of business, unless the business is incidental to the attainment of its objectives and separate books of account are maintained by it in respect of such business: 143 Providing relief from distress to humans based on Christian values - refer to Director of Income Tax v. Bharat Diamond Bourse (2002) 10 SCC 392, and Bangalore Water Supply and Sewage Undertaking v. A Rajappa (1978) 2 SCC 213. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2020 against a common judgment dated 27.9.2019, which relate to the Gujarat Cricket Association, Saurashtra, Baroda and Rajkot Cricket Association Cricket Association. 153 [2014] 360 ITR 633 (Mad) 154 Rule 3 (a) (ii) (B) of the latest BCCI Memorandum of Association and the Rules and Regulations 155 1997 (Supp 4) SCR 189 156 2008 (9) SCC 337 157 Dated 09.02.2018 in ITA 49/2014. 158 CA Nos. 9974/2018 and 10371/2017 159 CA Nos. 12058/2017 and 9886/2018 160 CA Nos. 16375/2017, 2047/2019 and Diary No. 5683/2019 161 CA No. 10598/2018 162 CA No. 17527/2017 163 CA Nos. 9860/2018, 8321/2018, 2335/2019, 4449/2019 and 4957/2019 164 CA Nos. 12869/2017 and 10406/2018 165 CA No. 11259/2018 166 D. No. 44856/2018 167 CA No. 9200/2018 168 SLP (C) Nos. 3759/2021, 4612/2021, 5167/2021, 4678/2021, 4636/2021, 4723/2021, 7854/2021 and 11683/2021 169 SLP (C) Nos. 8364/2021. 170 CA Nos. 21762/2017, 5719/2018, 6762/2018, 3343/2018, 3359/2018, 1643/2019, 3971/2019, SLP (C) 6686/2021, and SLP (C) No. 6580/2021 171 CA No. 6553/2019 and 783/2020 172 SLP (C) No. 5709/2021, 6005/2021 and 10490/2021 173 SLP (C) No. 7003/2021; 7166/2021; 6917/2021; 7510/2021; 7290/2021 and 7606/2021 174 SLP (C) No. 10908/2021; 778 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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