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2015 (9) TMI 11 - AT - Income TaxClaim of exemption under section 11 denied - income from non-members - CIT(A) has allowed the claim of principles of mutuality to the extent of income received from the members - Held that:- Prior to the amendment ie upto 31.03.2009, all the objects of any general public utility is eligible to be classified as charitable purpose under section 2(15) of the Act. After 01.04.2009, as per the second limb of section 2(15), any activity of rendering any services in relation to any trade, commerce and business for a cess or any other consideration, irrespective of the nature of use or application, or retention, of the income from such activity cannot come under the purview of charity. In the present case, the assessee is rendering services to its members custom house agents, to carry out their business/professional activities. Therefore, the activities of the assessee directly amount to the services rendered by it in relation to the trade, business and commerce. Hence, the assessee cannot be considered as a charitable organization and therefore, the Assessing Officer as well as the ld. CIT(A) rightly denied the exemption claim of the assessee under section 11 of the Act. Assessee is not eligible for claiming exemption under section 11 of the Act and also not eligible for claiming principles of mutuality. The Hon'ble Kerala High Court in the case of Investors Club, Trissur v. CIT [2008 (2) TMI 546 - KERALA HIGH COURT] has observed that "we do not know how the assessee can claim principles of mutuality when the assessee has entitled to claim exemption under charitable organization, it has got registration under section 12A of the Act. Depreciation claim correctly denied - The assessee has not provided any material to show that he is entitled to claim depreciation again on the same assets. That apart, once the exemption claimed by the assessee under section 11 of the Act is disallowed, the claim of depreciation has to be calculated as per the regular provisions of the Act. Accordingly, this ground of appeal of the assessee is also dismissed. - Decided against assessee.
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