2010 (3) TMI 686 - HC - Income Tax

High Court affirms renewal of exemption under section 80G for charitable society. Revenue appeal dismissed.

The High Court upheld the renewal of exemption under section 80G of the Income-tax Act, 1961, for the assessee-society. The Tribunal's decision granting ... Renewal of exemption under section 80G - no payment was made by the assessee- respondent to any of its members on account of salary or wages and that the assessee is purely a social organisation carrying out social activities - assessee-respondent has filed certificate of registration, memorandum of association, its rules and regu- lations, initial certificate granting exemption under section 80G of the Act, the renewals of exemption granted earlier, notes on activities annexed with Form 10G, consolidated audited balance-sheet, receipts of payments etc - Held that: - activities of the respondent-society are devoted to charity and social welfare activities - earlier years similar activities have been accepted by the Revenue - Tri- bunal has rightly continued the benefits to the assessee-respondent under section 80G(5)(vi) of the Act. The appeal is wholly without merit and the same is accordingly dismissed Issues:Challenge to renewal of exemption under section 80G of the Income-tax Act, 1961.Analysis:The High Court was approached by the Revenue challenging the order of the Income-tax Appellate Tribunal granting renewal of exemption under section 80G of the Income-tax Act. The Tribunal had examined the various activities of the assessee-respondent, including education, running of female education centers, health care, and social welfare. It was noted that no payments were made to members as salary or wages, indicating the organization's social nature. The assessee was found to be running 295 centers dedicated to various activities. The Tribunal reviewed several documents provided by the assessee, such as registration certificate, memorandum of association, balance sheets, and income-expenditure accounts. After considering all activities and documents, the Tribunal concluded that the Commissioner of Income-tax was unjustified in denying the renewal under section 80G(5)(vi) of the Act, affirming the entitlement of the assessee to the exemption.The Court, after hearing the Revenue's arguments, found no violation of any provision that would justify admitting the appeal. It was observed that the respondent-society's activities were focused on charity and social welfare, consistent with previous years' accepted activities. The Court agreed with the Tribunal's decision to continue the benefits under section 80G(5)(vi) of the Act. Consequently, the appeal was deemed to be without merit and dismissed accordingly.