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2016 (12) TMI 1423
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....nces of the case. 2. The ld CIT (A) ought to have appreciated that the main object of AIRDA is to promote and develop Holiday ownership and timeshare concept in India, thereby enhancing the development of Tourism Industry in India. Therefore, the object would fall within the ambit of the fourth limb of definition of Charitable purpose u/s 2(15) viz advancement of any other object of general public utility". 3. The learned CIT (A) erred in appreciating the cases cited in support of the stand of the appellant. (i) CIT Vs. Andhra Chamber of Commerce (1965) 55 ITR 722. (ii) Federation of Chambers of Commerce & Industry 130 ITR 186 (SC) 4. The appellant therefore prays that the proposal to be made by the learned CIT (A) for withdrawal of r....
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....rried out by the assessee is not for the public at large, but it is for a small class of people. Therefore he held activities of the assessee are not for the charitable purposes. Therefore, he denied the claim of the assessee as a charitable organization and exemption under section 11 was rejected. However, he stated that as the assessee is also receiving consideration from the members and fixed deposits in bank in the form of subscription and interest and the income has also been applied towards the benefit of members therefore the income is not taxable in view of the principles of mutuality. Therefore, accordingly, the income of the assessee was assessed at nil and he mentioned that a proposal to the director of income tax (E) is also for....
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....ppellant is not carrying on any business activity as there is no intention to on profit and utilize it for the commercial purposes. It was submitted that the assessee is solely utilize the income from activities of the trust for fulfillment of the object for which it is intended. He further relied upon the decision of the coordinate bench in case of CEO clubs India versus DDIT exemptions in ITA number 03/05/2003/M/2011 dated 16/05/2012 and DDIT exemptions versus Khar Gymkhana 385 ITR 162 of the Hon'ble Bombay high court. He further submitted that the assessee is registered under section 12 A of the income tax act w.e.f. 26/09/2005 and admittedly there is no change in the nature of the activities of the assessee during the assessment year in....
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....e tax act, w.e.f. 26/9 /2005. Main object of the assessee is to promote and develop holiday ownership and time-share concept in India. The appellant has at present 29 members as stated by the Ld. Commissioner of income tax appeal who are all hoteliers and the assessee is carrying on the activity of conducting consultancy services and taking membership fees from all these members for the purpose of its objects. This is not the 1st year of the assessee but it has been granted registration since 26th of September 2005 and Central board of direct taxes has issued a circular dated 27th of May 2016 vide circular No. 21/2016 wherein in para No. 2 of that circular it is stated that:- "2. Section 2(15) of the Act provides definition of "ch....
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....l receipts instead of the fixed limit of Rs. 25,00,000/- as it existed earlier. 3. The temporary excess of receipts beyond the specified cut-off in one year may not necessarily be the outcome of alteration in the very nature of the activities of the trust or institution requiring cancellation of registration already granted to the trust or institution. Hence, section 13 of the Act has been amended vide Finance Act, 2012 by inserting a new sub-section (8) therein to provide that such organization would not get benefit of tax exemption in the particular year in which its receipts from commercial activities exceed the threshold whether or not the registration granted is cancelled. This amendment has taken effect retrospectively from 1st Apr....
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.... to be initiated strictly in accordance with section 12AA(3) and 12AA(4) after carefully examining the applicability of these provisions." 9. Therefore, without adjudicating on the issue whether the assessee is carrying on any trade, commerce or business or not, the issue is squarely covered in favour of the assessee because there is no change in the activities of the trust for the impugned assessment year and further the fact is not disputed by the revenue that registration under section 12 A of the appellant trust still remains in the force, we are not inclined to uphold the order of the lower authorities. Furthermore the case of the assessee is also squarely covered by the decision of Hon'ble Bombay high court in case of director of i....