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2019 (1) TMI 1066 - AT - Income TaxEligible for exemption u/s. 11 or 10(23C) - profits on sale of tickets and advertisement space (BCCIT Reimbursements) - dominant and prime objective of the institution - utilization of accumulated funds / profit - Held that:- As considered the proviso to section 2(15) and held that if the dominant and prime objective of the institution, which claims to have been established for charitable purposes, is profit making, whether its activities are directly in the nature of trade, commerce or business or indirectly in rendering of any service in relation to any trade, commerce or business, then it would not be entitled to claim its object to be a ‘charitable purpose’. On the flip side, where an institution is not driven primarily by a desire or motive to earn profits, but to do charity through the advancement of an object of general public utility, it cannot but be regarded as an institution established charitable purposes. Assessee-association only existed for the purpose to develop the game of the cricket in the State of Andhra Pradesh and therefore, the main character of the assessee is a charitable in nature. So far as conducting international matches on behalf of the BCCI is concerned, it is secondary or incidental to achieve the main object. Therefore, in our opinion, the dominant object of the assessee is to only develop the game of the cricket and not to carry any business activity directly or indirectly in the activities related trade, commerce, business. Therefore, assessee is entitled for claim of exemption under section 11 and section 10(23C)(iv) of the Act. No reason to interfere with the order passed by the CIT(A). - Decided against revenue. Accumulated fund utilized within the specific period basing on the statement of expenditure submitted by the society during appellate proceedings - additional evidence produced by the assessee society by way of statement of expenditure - Held that:- DR is not able to point out any mistake or error committed by the CIT(A) finding in respect of accumulation of funds. However, AR has pointed out from paper book at page Nos. 12 to 15 that in respect of accumulation of profits, a detailed submission was made before the Commissioner (Exemptions) by letter dated 04/08/2017, the Commissioner (Exemptions), Hyderabad has considered the same and gave a categorical finding that there is no violation in respect of accumulation of funds pertaining to Financial Year 2007-08 and 2008-09 for treating unutilized within the specified period of five years. AO is not correct in saying that the funds are not utilized within the period of five years. We find that the CIT(A) by considering the detailed explanation given by the assessee for accumulation of funds for the Financial Years 2007-08 & 2008-09 and utilization of the same and gave a categorical finding that the assessee has not violated in respect of accumulations made under section 11(2). Therefore, CIT(E) dated 28/08/2017 and also CIT(A) examining the accumulations and utilization of funds for the Financial Years 2007-08 & 2008-09 gave a categorical finding that there is no violation committed by the assessee, all funds are utilized in time as per law. We find no reason to interfere with the order passed by the CIT(A). Thus, this ground of appeal raised by the Revenue is dismissed.
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