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TMI Blog2024 (4) TMI 545X X X X Extracts X X X X X X X X Extracts X X X X ..... fined under the provisions of section 2(15) of the Act. 2. Whether, on the facts and in the circumstances of the case and in law, the Ld. CIT(A) was justified in allowing the benefit of exemption u/s 11 & 12 of the I.T. Act, 1961 to the assessee, ignoring the fact that once the assessee is hit by proviso to section 2(15) of the I.T. Act, its objects are no more charitable objects then such activities cannot be treated as income derived from property held for charitable purposes and therefore such income is also not exempt u/s 11 of the Act. 3. Whether on the facts and circumstances of the case and in law and in light of the law laid down by Hon'ble Supreme Court in the case of ACIT (Exemption) Vs. Ahmedabad Urban Development Authority [2022] 143 taxmann.com 278 (SC), the Ld. CIT(A) erred in not appreciating that even if the activities of the assessee are held to the covered under residuary part of section 2(15) as advancement of any other object of general public utility even then it is not entitled to exemption u/s 11 because it is hit by the proviso to section 2(15) as the income of the assessee consists of membership fees, advertisement, sale of publication, sponsorship fees ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 009-10, 2011-12 and 2013-14, the Assessing Officer had rejected assessee's claim of exemption u/s. 11 of the Act on the ground that the activities of the assessee are commercial in nature. The assessee carried the issue in appeal before the Tribunal. The Tribunal decided the issue in favour of assessee holding that assessee is eligible for the benefit of exemption u/s.11 of the Act. In the impugned Assessment Year, the CIT(A) placing reliance on the decision of Tribunal reversed the findings of Assessing Officer and directed the Assessing Officer to delete the addition. 7. The Co-ordinate Bench in Assessment Year 2011-12 (supra), after examining facts of the case held as under: "11. We are of the considered view that the fact that holding of the seminar at Bangalore by the assessee was in furtherance of the dominant object of the assessee, viz. empowerment, betterment and creating awareness amongst the industrialists of the Fragrance and Flavours industry, and display of the products of the sponsors can safely be concluded to be for furtherance of and in the interest of the members of the trade. We are unable to persuade ourselves to be in agreement with the view of the A.O that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the revenue as the primary reason for concluding that the assessee was carrying on commercial activities could be held as such and brought within the sweep of the first proviso of Sec. 2(15). We further find that the Hon'ble High Court of Madras in the case of Director of Income Tax (Exemption) Vs. The Chartered Accountant Study Circle (2012) 250 CTR 70 (Mad), had the occasion to deliberate on the scope and gamut of the first proviso of Sec. 2(15) in the case of an assessee trust whose objects among other things was to conduct periodical meetings on professional subjects. The High Court observed that the publishing and sale of books, booklets etc. on professional subjects related to audit and not on any other subject by the assessee. The sale of the books was primarily made to the members of the society, as well as made available to the general public, with the aim to help the society to get better, well-equipped and skilled set of Chartered Accountants for maintaining audit quality, which however could not be construed as a trade or commerce or business. Thus, the High Court observed that the activities of the assessee trust in publishing and selling books of professional in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re, the activities of providing coaching classes or undertaking campus placement interviews for a fee were in relation to the main object of the assessee institute, which could not be held to be trade, business or commerce. The High Court while concluding as hereinabove, had observed as under: "After going through the provisions of the ICAI Act and the Regulations framed therein as well as various activities carried on by the petitioner, we are of the view that the petitioner institute does not carry on any business, trade or commerce. The activity of imparting education in the field of accountancy and conducting courses both at pre-qualification as well as post-qualification level are activities in furtherance of the objects for which the petitioner has been constituted. Activities of providing coaching classes or undertaking campus placement interviews for a fee are in relation to the main object of the petitioner which as stated earlier cannot be held to be trade, business or commerce. Accordingly, even though fees are charged by the petitioner institute for providing coaching classes and for holding interviews with respect to campus placement, the said activities cannot be st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... We further find that the surplus generated by the assessee trust was utilized only for the purpose of feeding its dominant object, and no part of such surplus was distributed amongst its members. We have deliberated on the records pertaining to the nature of the activities of the assessee trust, and have observed that the generation of the surplus in its hands was merely a by-product of its main object, which had incidentally resulted in the course of furtherance of its dominant object, viz. advancement and development of the Fragrance and Flavors industry in India. We are further of the view that as the international seminar at Bangalore was held by the assessee for the very first time, and the assessee was neither holding such type of seminars by way of a regular and systematic activity, nor for the general public at large, therefore, on the said count also the same can safely be held as not being in the nature of a commercial activity. We have also deliberated on the order of the ITAT, Kolkata, in the case of Indian Chamber of Commerce Vs. Income Tax Officer (2015) 167 TTJ 1 (Kolkata) as had been relied upon by the ld. A.R, and find that a similar view in context of the issue be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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