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2016 (10) TMI 46 - HC - Income TaxCharitable trust - commercial activities - Held that:- The term “charitable purpose” includes advancement of any other object of general public utility. Proviso to section 2(15) however provides that such purpose will not be charitable purpose if it involves carrying on any activity of nature of trade or business or any activity rendering any service in relation to the said commercial business, for a cess or fees or any other consideration irrespective of the nature of use or application, or retention of the income from such activity. This sub-section however carries a further proviso which provides that the proviso will not apply to aggregate value of receipts from the activities referred to thereunder is 25 per cent or less in the previous year. In other words, so long as the aggregate value is less than 25 per cent, the exclusion clause contained in the first proviso would not activate. Surely, at the time of application for registration, when the applicant institute has not even commenced its activities, it would not be possible to apply this proviso and the question of their applicability would arise at a later stage while actually granting exemption. As the Tribunal held that the institute was engaged in the object of general public utility, we do not see any error in such view. - Decided against revenue
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