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2019 (7) TMI 1889 - AT - Income TaxExemption u/s 11 - Charitable activity u/s 2(15) - proof of charitable activity undertaken by assessee trust - income from business As applied or accumulated for application for the charitable or religious purpose of the trust - HELD THAT:- We agree with the contentions of the Ld. AR that the assessee’s case is covered in its favour by the orders of the Coordinate Benches of the Tribunal in assessee’s own cases for three different assessment years. We would like to make a reference to the Tribunal’s order for assessment year 2009-10 wherein detailed findings have been recorded by the Tribunal. This order was upheld by the Hon’ble Uttarakhand High Court in[2019 (2) TMI 1616 - UTTARAKHAND HIGH COURT] - there is no bar in the charitable trust/institution carrying on business provided the conditions prescribed in section 11(4)/11(4A) of the Act are satisfied. The Hon'ble Supreme Court in the case of P. Krishna Warriers [1964 (4) TMI 13 - SUPREME COURT] has been pleased to hold with reference to income tax Act 1922 that if the trust carried on business and the business itself is held in trust and the income from such business is applied or accumulated for application for the charitable or religious purpose of the trust, the conditions prescribed in section 4(3)(i) and fulfilled and the income is exempt from taxation. Authorities below have grossly erred in holding that the appellant's activities in relation to production and sale of ayurvedic preparations are not incidental to its main objective as the same are commercial in nature. We thus hold that in the present case the authorities below have failed to appreciate that the business set up and held by the appellant under trust is to sub serve the predominant charitable objects of providing medical relief education and relief to poor. Furthermore, since separate books of accounts were maintained and the entire profits are for charitable objects, the conditions prescribed in section 11(4A) of the Act, too were fulfilled. - Decided against revenue.
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