TaxTMI 
TaxTMI 
2019 (7) TMI 620
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....ellate Tribunal, Madras "B" Bench, Chennai in I.T.A Nos.2006/Mds/2016, 2007/Mds/2016 and 2008/Mds/2016 dated 03.08.2017 for the assessment years 2009-10, 2010-11 & 2011-12 respectively. 2.The above Tax Case Appeals have been filed raising the following substantial questions of law:- "(i) Whether the Appellate Tribunal is correct in law in denying the tax exemption u/s 11 of the Act for the Assessment Years under consideration despite the continued availability of registration u/s 12A(a) of the Act for the appellant as a Public Charitable Trust? 2. Whether the appellate Tribunal is correct in law in denying the tax exemption u/s 11 of the Act for the Assessment Years under consideration on the misconstruction of the provisos below se....
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....ioner of Income Tax(Appeals)-VII (CIT(A)) raising various contentions and relying upon several decisions. The CIT(A) by order dated 28.03.2016 allowed the appeals. 6. The Revenue preferred appeals before the Tribunal contending that the assessee's activities are purely in the nature of trade, commerce or business thereby bringing their case squarely under the proviso to Section 2(15) of the Act. The Tribunal in paragraph 6 of the impugned order extracted the findings of the CIT(A). In paragraph 7 and 8, the stand taken by the authorised representative of the assessee has been referred. The discussion is in paragraph 9. 7. We find that the only finding recorded by the Tribunal is that from the objectives of the assessee trust, it is ....
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....so necessary to consider the fact of Circular No.11 of 2008 dated 19.12.2008, issued by the CBDT and the operative portion of which are as follows: 3.1. There are industry and trade associations who claim exemption from tax u/s 11 on the ground that their objects are for charitable purpose as these are covered under 'any other object of general public utility'. Under the principle of mutuality, if trading takes place between persons who are associated together and contribute to a common fund for the financing of some venture or object and in this respect have no dealings or relations with any outside body, then any surplus returned to the persons forming such association is not chargeable to tax. In such cases, there must be complete ide....
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....to. We have pointed out these orders only for the purpose that in those cases the objectives of the concerned assessee were analysed by the Tribunal. However, we find such exercise was not done in the instant case, which was required to be done. We also make it clear that we have not expressed any opinion on the merits of the matter but, what we are concerned is that, an exercise should be done to examine the contention advanced by the assessee. More particularly, the contention which were raised in this appeal and the decisions which were cited at the bar. 14. One more aspect which weighed in our minds is the show cause notices issued by the Director of Income Tax (Exemptions). The first of which was issued on 04.03.2009, calling upon th....
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....e, or business in entirety from the definition of "charitable purpose", but it outlined the above referred activities from the ambit of the definition of "charitable purpose" only if it is carried out for a cess or fee or any other consideration. j.) In our Association's case, from the wattle extract distribution activity some surpluses are arising due to the following reasons. i.) At the time of clearing the consignment of wattle extract from foreign countries, the exact cost per ton could not be ascertained because of interest rate and uncertainty in the period of repayment of loan availed from the bank for importing the raw materials and fluctuations in foreign exchange. ii.) So the Association fixed an "adhoc"cost for distr....