TaxTMI 
TaxTMI 
TaxTMI 
2023 (2) TMI 535
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.... Sarkar, Adv. For the Respondent(s) : Mr. J.K. Mishra, Sr. Adv., Mr. D. Mahesh Babu, AOR, Mr. Ganesan Subbian, Adv., Mr. Shishir Pinaki, Adv., Mr. Dhanaeswar Gudapalli, Adv., Mr. Kasoju Mahesh Chary, Adv., Ms. Mallika Das, Adv., Mr. Balbir Singh, A.S.G., Mr. Raj Bahadur Yadav, AOR, Mr. Ashok Panigrahi, Adv., Mr. Chinmayee Chandra, Adv., Mr. Prashant Singh, Adv., Mrs. Monica Benjamin, Adv., Ms. Meena Devi, Adv. And Mr. Prasenjit Sarkar, Adv. JUDGMENT S. RAVINDRA BHAT, J. 1. Special leave granted. Mr. D. Mahesh Babu waives notice of appeal on behalf of the sole respondent [hereafter called "the assessee"]. The appeal is heard finally. 2. The Commissioner of Income Tax (hereafter referred to "revenue") is aggrieved by the impugned judgmen....
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....re in Lajpat Nagar and old age home in Dwarka in Delhi. The assessee is also building a hospital in the name of Gopa Bandhu Medical Research Centre in Odisha. The assessee was also allowed exemption under Section 11(1) but the same has been denied during the A.Y. 2010-11 and 2011-12. The Assessee Officer denied the exemption invoking the proviso to Section 2(15) on the ground that the assessee is involved in trade, commerce or business as it manages and runs a printing press and a newspaper. The assessee argued that it was primarily a non-profit institution involved in charitable activities and did not engage in any trade, commerce or business or any such activity. 4. The assessee approached the Appellate Commissioner who allowed its plea ....
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....ted that the activity of generating income through advertisement is only incidental and income from advertisement cannot be called part of the main object of the trust but rather necessary for it to attain its charitable objectives. Analysis and Findings 8. During the relevant assessment year, the assessee society claimed exemption, inter alia, in respect of income from newspapers, which included advertisement revenue, to the extent of Rs. 9,52,57,869/- and surplus of Rs. 2,16,50,901 from its activities in Delhi. 9. The judgment of this court, in Ahmedabad Urban Development Authority had examined various kinds of activities to determine whether they are charitable in nature, relatable to trusts or societies with general public utility ob....
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....mount towards consideration for such an activity (advancing general public utility), which is on cost-basis or nominally above cost, cannot be considered to be "trade, commerce, or business" or any services in relation thereto. It is only when the charges are markedly or significantly above the cost incurred by the assessee in question, that they would fall within the mischief of "cess, or fee, or any other consideration" towards "trade, commerce or business". In this regard, the Court has clarified through illustrations what kind of services or goods provided on cost or nominal basis would normally be excluded from the mischief of trade, commerce, or business, in the body of the judgment. A.4. Section 11(4A) must be interpreted harmoniou....
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.... nature of trade, commerce or business" or "service in relation to trade, commerce or business", for any consideration. During the course of submissions, it was urged that advertisement revenue should not be treated as business or commercial receipts since that virtually is the lifeblood which sustains the activity of publication of newspapers. It was highlighted that the object of maintaining the activity of publishing and distribution of newspaper remains the advancement of general public utility, as it has the effect of both notifying and educating the general public about the current affairs and developments. The inclusion of advertisements also serves as information to the general public, especially in areas of employment, availability....