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of <h1>High Court Upholds ITAT Order Granting Tax Exemption to Charity</h1> <h3>Commissioner Of Income Tax Versus Professional Assistance For Development Action</h3> Commissioner Of Income Tax Versus Professional Assistance For Development Action - [2022] 447 ITR 103 (Del) Issues:Challenge to ITAT order regarding charitable activities exemption under Section 11 of the Income Tax Act 1961.Analysis:The appeal challenges the ITAT order concerning the exemption under Section 11 of the Income Tax Act 1961. The Appellant argues that the respondent's activities are not charitable in nature, invoking the proviso to section 2(15) of the Act. The Appellant contends that the ITAT erred in directing the Assessing Officer to allow the exemption under Section 11 without considering the nature of the Assessee's activities.The Assessee is engaged in uplifting the poor and providing training in rural areas, receiving grants from the government and donations from organizations. The Appellant denied the exemption under section 11 for the current assessment year, but the CIT(A) granted the exemption with all benefits. The Revenue appealed to the ITAT, which upheld the CIT(A) decision by determining that the Assessee is not involved in trade, commerce, or business, hence the proviso of section 2(15) does not apply.The ITAT noted the absence of evidence indicating a profit motive in the Assessee's activities. The Assessee did not charge fees beyond project costs and the donor's supervision did not establish a profit motive. Following the rule of consistency, the ITAT dismissed the Revenue's appeal, emphasizing the Assessee's relief activities for the poor.The Court referred to precedents emphasizing that collecting fees does not negate charitable purposes. The Assessee running a printing press for charitable purposes was considered not engaged in trade, commerce, or business for profit distribution. The Court agreed with the CIT(A) and ITAT findings that the Assessee did not pursue profit distribution.The Court found no substantial question of law in the appeal and dismissed it. The judgment highlights the importance of substantial questions of law and the limited scope of High Court interference with lower courts' factual findings.This detailed analysis provides a comprehensive overview of the judgment's key points, including the arguments, findings, and legal principles applied in the case.
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