TaxTMI 
TaxTMI 
2011 (3) TMI 921
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.... section 25 of the Companies Act. According to the assessee, it is formed for the purpose of advancement of the object of general public utility, which is one of the charitable purposes covered by section 2(15) of the Act and so much so it is entitled for registration as "charitable institution" under section 12A of the Act. In this regard, an application under section 12AA was submitted before the Commissioner of Income-tax on 27-3-2006 which is for the assessment year 2006-07. However while considering the application, the Commissioner found that the assessee is not entitled to registration under the head "charitable institution" for the following reasons :- (1) The benefit of the foundation, according to the main object clause, will go to the members of the foundation. (2) The activities covered by the object clause are essentially business activities which are not intended to serve any benefit for the public generally and so much so it is not formed for advancement of object of any general public utility. (3) Since the assessee is formed for starting telecasting and broad casting of television and radio programmes respectively, benef....
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....the contentions raised by the assessee, rejected the claim stating that the assessee is not a charitable institution established for advancement of any object of any general public utility. 6. The assessee filed appeal before the Tribunal raising the same contentions raised before the Commissioner. The Tribunal accepted the assessee's contention that the broadcasting and telecasting activities will improve social and spiritual upliftment of general public. So far as the objection raised by the Commissioner on the benefits going to the members of the Company and also about the extra territorial operations of the assessee i.e., telecasting and broadcasting of programmes outside India are concerned, the Tribunal held that these expressions are only "innocuous expressions" in the object clause and therefore the Tribunal allowed the appeal. It is against this order of the Tribunal, the revenue has filed this appeal before us. 7. During hearing of the appeal, we felt that since the assessee was registered 5 years back it would be beneficial to find out from the assessee as well as from the Department as to whether the assessee was engaged in any charitable activity including produc....
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....Companies Act and so much so, there is no provision for declaration of dividend to the members of the Company. What is stated in one of the object clauses is that the entire income of the Company will be utilized for the purpose for which it is formed i.e., to carry on the activities stated in the main clause, which is production of television and radio programmes for the purpose of telecasting and broadcasting through assessee's own network or through network hired by them. We have closely examined each and every object stated in the main object clause. Generally, the activities referred to therein i.e., production of television and radio programmes and telecasting and broadcasting of the same are commercial activities. Further the object clause provided for the assessee to act as an agent, broker, liasioner, introducer etc., which are purely commercial activities intended to make profit. Since the assessee is not holding any business in charity or distributing any surplus for charitable purposes, the question to be considered is whether the carrying on of the activities referred to in the object clause by itself constitute advancement of any object of general public utility withi....
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....y held by us every publication, telecasting or broadcasting may lead to imparting some knowledge helping human development. 10. So far as other ground on which the Commissioner declined the application such as the profit goes to the members of the foundation in terms of the object clause contained in the Memorandum and Articles of Association is concerned, the assessee's counsel produced documents showing that an amendment is made to the object clause deleting the above provision. However, it is seen from the documents produced that such amendment is certified by the Registrar of Companies only on 1-12-2006. Obviously the assessee has not produced the amendment made to the Memorandum of Association of the Company neither before the Commissioner nor before the Tribunal. In any case, the application for registration has to be considered with reference to the object of the assessee available as on the end of the previous year during which registration is sought under section 12A of the Act and such amendment probably helps for seeking registration in later years. Of course the assessee's counsel justified the Tribunal's observation that the statement in the Memorandum and Articles ....