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2020 (7) TMI 505 - AT - Income TaxDisallowing the claim of exemption u/s.11 - assessee is registered u/s.12A - CIT- A upheld the action of the ld. AO that assessee trust is only a mutual association and accordingly, any receipt received from non-members would be liable to tax as business income and held that assessee’s case is squarely covered by the proviso to Section 2(15) of the Act and accordingly, upheld action of the ld.AO in rejecting the claim of Section 11 - HELD THAT:- Admittedly, the activities carried on by the assessee were not with a view to make profits. It is not even the case of the revenue that assessee trust is not existing for the purpose of ‘not for profit’ within the meaning of Section 11-13 of the Act. We find that the ld. AO had erroneously treated the assessee as a mutual association instead of charitable organization merely on the ground that services were rendered by the assessee to its members. It is pertinent to note that assessee had not even claimed to be a mutual association and had not claimed any exemption from Income Tax on the basis of principle of mutuality. We find from the perusal of the orders of the lower authorities that nowhere they had pointed out that assessee activities involved in the nature of trade, commerce or business or activity of rendering any service in relation to any trade, commerce or business and in consideration of which a cess or fee has been received by the assessee. Hence, we hold that assessee’s case does not fall within the ambit of proviso to Section 2(15) of the Act. - Decision in the case of ALL INDIA RUBBER INDUSTRIES ASSOCIATION VERSUS ADIT (E) [2018 (10) TMI 1172 - ITAT MUMBAI] followed - Decided in favour of assessee.
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