TaxTMI 
TaxTMI 
2017 (7) TMI 1492
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 2. The grounds of appeal filed by the assessee read as under: - 1. The Ld. Commissioner of Income Tax (Appeals) erred in confirming the order of the Income Tax Officer upholding taxation of interest earned by appellant during the year of Rs. 79,85,535/- without granting exemption u/s. 11 and considering the fact that appellant is a company registered under the provisions of section 25 of the Companies Act, 1956 prohibiting any distribution of income amongst the members and complies with all the requirements of section 2(15) of the Income-tax Act hence entitled for exemption u/s. 11. 2. The Ld. Commissioner of Income Tax (Appeals) erred in denying exemption u/s. 11 to the appellant without considering the fact that do....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e principle of rest judicata does not apply to Income-tax Act. The Ld. Commissioner of Income Tax (Appeals) failed to appreciate the correct principle of law. 7. Appellant pray that appellant being a company registered under the provisions of section 25 of the Companies Act and object being development and promotion of trade dominant purpose being charitable is entitled for necessary exemption u/s. 11 of the Act. 3. Briefly stated, the facts of the case are that the Assessing Officer (AO) noticed during the course of assessment proceedings that the activities as carried out by the assessee were in the nature of trade, commerce, business etc. during the year under consideration. The assessee received Rs. 79,85,535/- as inter....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ons claim both to be charitable institutions as well as mutual organizations and their activities are restricted to contributions from and participation of only their members, these would not fall under the purview of the proviso to section 2(15) owing to the principle of mutuality." 4.1 Thus the Ld. CIT (A) has come to a finding that the assessee is a trade association and is claiming both to be charitable institution as well as mutual association. Consequently, as per the above Circular, its case will be covered by the principle of mutuality. 4.2 The Ld. CIT (A) has also noticed that the assessee has earned interest income which cannot be said to have been received from its members. Accordingly, the same is not covered by the princi....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 138 (Delhi Tribunal) and (xiii) Association of State Road Transport Undertaking vs. CIT 155 ITD 117 (Delhi). 5.1 The Ld. Counsel of the assessee submits that the assessee company was formed by the Ministry of Textile, Government of India and was registered on 08.09.1995 under the provisions of section 25 of the companies Act, 1956. The company was promoted with the main object of "(1) To promote, support, develop, advance and increase powerlooms and export of powerloom fabrics and made-ups thereof and to carry out any such activity in such manner as may be necessary or expedient. (2) To understand or assist in research in methods, designs, etc and schemes of technical nature intended to improve the efficiency of the powerloom sector." ....