TaxTMI 
TaxTMI 
TaxTMI 
2016 (2) TMI 598
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....iety is registered as a charitable institution u/s 12AA of the Act. The main object of the society is to promote the game of golf in the state of Tamilnadu. The assessee is also maintaining liaison with other golf clubs in the country. According to the ld. Representative, the assessee is maintaining a golf course. The ld. Representative further submitted that while granting registration u/s 12AA, the DIT(E) examined the object of the society and found that it is a charitable institution covered under the 4th limb of sec. 2(15) of the Act - 'Any other object of general public utility'. During the assessment year under consideration the assessee has received Rs. 3,55,92,060/- under various heads in the course of its charitable activity. The A....
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....resentative further clarified that the assessee has also claimed exemption on the principles of mutuality. According to the ld. Representative, no person can make a profit by himself. The assessee-society collects money from its members and provides certain facility to its members. Placing reliance on the judgment of the Apex Court in the case of CIT vs Bankipur Club Ltd 226 ITR 97, the ld. Representative submitted that the income of the mutual association cannot be brought to tax. Referring to green fees received from the non-members, the ld. Representative submitted that green fees was received from non-members for using the grounds maintained by the assessee-society. If at all anything is to be taxable on the principles of mutuality, the....
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....hen the assessee is engaged in trading and commerce, it is not eligible for exemption u/s 11 of the Act. When the assessee claims as a charitable institution as well as mutual organization, its activities are not restricted to contribution from its members, according to the ld. Representative, the principles of mutuality is not applicable. According to the ld. Representative, the third parties who are non- members are also contributing to the corpus of the assessee, therefore, it cannot claim exemption on mutuality. According to the ld. Representative, when the assessee was dealing with non-members and collecting fees from non-members also, the proviso to sec.2(15) would come into operation, therefore, the assessee is not eligible for exemp....
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....r the assessee that the assessee is also maintaining ecology, the ld. DR clarified that to conduct sport of golf, the assessee has to necessarily maintain the golf field. It is an incidental activity in the course of maintaining the gold club, therefore, it is not an activity for maintaining ecology system. According to the ld. DR, the assessee cannot be considered to be a charitable institution, hence, the CIT(A) has rightly confirmed the order of the Assessing Officer. 7. We have considered the rival submissions on either side and also perused the material available on record. Admittedly, the assessee-society is registered u/s 12AA of the Act as charitable institution. The main object of the society is to promote the sport of golf in the....
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....adu, therefore, at any stretch of imagination, the collection of sponsorship fee cannot be considered as commercial activity by the assessee. Similarly, the tournament fee, annual subscription fee, green fee, catering income, round charges etc. are incidental to the main activity of promoting the sport of golf. As rightly submitted by the ld. Representative for the assessee, the non-refundable membership fee collected at the time of admission is in the nature of capital receipt, therefore, it cannot be treated as income of the assessee. Therefore, the CIT(A) is not justified in saying that the assessee is engaged in activity which is similar to commerce or trade. This Tribunal is of the considered opinion that the assessee is engaged only i....