TMI Blog2017 (3) TMI 979X X X X Extracts X X X X X X X X Extracts X X X X ..... dical relief ” is required to be given widest meaning so as to achieve the object and purpose of granting exemption to an assessee, whose activities are for “charitable purpose”. It is not in dispute that the assessee's activities includes providing maternity, animal nursery, fertility, vaccination to milch animals belonging to the milk producers. Thus, the assessee's activities are to ensure that milching animals are free from diseases, their breed improvement and overall well-being. Thus, we are of the opinion that activities of the medical relief, even to the animals, will fall under former specific category of “medical relief ” and not covered under the last limb of Section 2 [15] of the Act ie., “advancement of any other object of general public utility”. - Decided in favour of assessee - Tax Appeal No. 49 of 2017 - - - Dated:- 8-2-2017 - M. R. Shah And B. N. Karia, JJ. Mr M. R. Bhatt, Sr Advocate with Mrs Mauna M Bhatt, Advocate for Appellant Mr Tej Shah, Caveator for the Opponent JUDGMENT ( Per : Honourable Mr. Justice M. R. Shah ) Feeling aggrieved and dissatisfied with the impugned judgment and order dated 18th August 2016 passed by the Income Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing Officer. 2.3 Feeling aggrieved and dissatisfied with the order passed by the learned CIT[A], the assessee preferred appeal before the learned Tribunal, being ITA No. 3032/Ahd/2013. By the impugned judgment and order, considering the object and purpose as contained in the memorandum of association and considering the activities of the assessee trust, the learned Tribunal has held that the activities of the trust can be said to be providing medical relief, and therefore, proviso to Section 2 [15] of the Act shall not be applicable and the assessee shall be entitled to exemption under Section 11 [1](a) of the Act. 3. Feeling aggrieved and dissatisfied with the impugned judgment and order dated 18th August 2016 passed by the learned Tribunal, the Revenue has preferred the present Tax Appeal with the following proposed questions of law :- [A] Whether the Appellate Tribunal has substantially erred in allowing the assessee's appeal, negating the finding of the CIT [Appeals] as well as the Assessing Officer denying the benefits of Section 11 [1](a) of the I.T Act and deleting additions of ₹ 3,36,06,368/- ? [B] Whether the Appellate Tribunal has substan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed ejusdem generis with the next following expression and the advancement of any other object of general public utility so as to connote relief to the public at large. It is submitted that therefore, the expressions themselves being clear, it cannot be said that the medical relief to the animals would be covered in those expressions. It is submitted that therefore, the expression, relief of the poor, education, medical relief cannot be read in isolation and the same is to be read along with the relief to the public and therefore, for advancement of any other object of general public utility . In support of his above submissions and as to how to read the said expressions, learned counsel Mr. Bhatt has heavily relied upon a decision of the Hon'ble Supreme Court in the case of Sole Trustee Lok Shikshan Trust v. Commissioner of Income Tax, reported in [1975] 101 ITR 234 [SC]. 4.2 Mr. Manish R Bhatt, learned counsel for the Revenue has further submitted that as the activities carried out by the assessee shall fall and/or can be said of general public utility and as the assessee is recovering Cess from the farmers, considering the proviso to Section 2 [15] of the Act, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on for the benefit and service to the farmers and further to implement programme to improve the productive efficiency of Live stock, Husbandry and agriculture. 3.2 To act as an advisory body in the interest of the farmers. 3.3 To promote Research, lectures, discussion and correspondence or information on the subject of agriculture and livestock husbandry and other related problems and to co-operate and collaborate with a similar organization, for furtherance of the objects of the ARDA. 3.4 To undertake directly and/or arrange by subsiding to point and circulate any research works, newsletters, bulletins, pamphlets, posters etc, that the ARDA may think desirable for the promotion of its object. 3.5 To organize or finance and/or assist the training and publicity programme through publicity and audio visual aids for the purpose of Education and extension work in Agriculture and Livestock Husbandry. 3.6 To undertaken research and establish and run veterinary hospitals, laboratory and services, artificial Insemination Centers and serves and further to provide medicines and Veterinary help to cattle and further to undertaken such programme which can improve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... blish and run the veterinary hospitals, laboratory and services, artificial Insemination Centers and services; to provide medicines and Veterinary help to the cattle including organizing programmes which can improve livestock housing veterinary health and to control and eradicate animal diseases. It is the case on behalf of the Revenue that as the assessee is recovering Cess from the agriculturists/farmers towards services provided by the assessee and/or to carry out the activities of the Trust and also on the ground that the activities of the assessee-Trust can be said to be medical relief, however, the same is to the animals, and therefore, activities of the assessee cannot be said to be charitable purpose as per first part of Section 2 [15] of the Act and the same shall fall under advancement of general public utility, and therefore, when the assessee is recovering Cess, as per proviso to Section 2 [15] of the Act, the activities of the assessee cannot be said to be charitable purpose , and therefore, assessee is not entitled to claim exemption under Section 11 [1] (a) of the Act. 7.2 However, considering Section 2 [15] of the Act, there cannot be any distinction between m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11 of the Act or not and whether in the facts and circumstances of the case the assessee can be denied exemption under Section 11 of the Act relying upon and/or considering the proviso to Section 2(15) of the Act is concerned so far as the amendment in Section 2(15) of the Act amended vide Finance Act, 2008 and insertion of proviso to Section 2(15) of the act is concerned, as such the same has been explained vide Circular No.11/2008 dated 19/12/2008. It is clarified that where industries or trade association claim both to be charitable institutions as well as mutual organizations and their activities are restricted to contributions from and participation of only their members, these would not fall under the purview of the proviso to Section 2(15) of the Act owing to the principles of mutuality. From the Circular No.11/2008 dated 19/12/2008 it appears that the the newly inserted proviso to Section 2(15) of the Act will apply to entities whose purpose is advancement of any other object of general public utility i.e. fourth limb of definition of charitable purpose contained in Section 2(15) of the Act and hence such entities will not be eligible for exemption under Section 11 or und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ivities. In the said decision the Division Bench also considered the decision of Hon ble the Supreme Court in the case of Lok Shikshana Trust (Supra), which has been relied upon by the Assessing Officer as well as the learned Counsel appearing on behalf of the revenue. In the said decision the Division Bench of this Court has observed as under : It appears to us that the decision of the tribunal which seeks to rest it on the observations made by the Supreme Court in Loka Shikshana Trust s (Supra) for holding that, the assessee is not entitled to exemption under Section 10(22) of the Act is based on a complete misreading of the observations of the Supreme Court. In Loka Shikshana Trust s (Supra) the Supreme Court, while dealing with the provisions of Section 11 read with Section 2(15) of the Act, which defines charitable purpose observed as under : The sense in which the word education has been used in Section 2(15) of the Act in the systematic instruction, schooling or training given to the young is preparation for the work of life. It also connotes the whole course of scholastic instruction which a person has received. The word education has not been used in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also means instructing or educating. It, therefore, cannot be said that the word education has been given an unduly restricted meaning by the Supreme Court in the said decision. Though, in the context of the provision of Section 10(22), the concept of education need not be given any wide or extended meaning, it surely would encompass systematic dissemination of knowledge and training in specialized subjects as is done by the assessee. The changing times and the ever widening horizons of knowledge may bring in changes in the methodology of teaching and a shift of the better in the institutional setup. Advancement of knowledge brings within its fold suitable methods of its dissemination and though the primary method of sitting in a classroom may remain ideal for most of the initial education, it may become necessary to have a different outlook for further education. It is not necessary to nail down the concept of education to a particular formula or to flow it only through a defined channel. Its progress lies in the acceptance of new ideas and development of appropriate means to reach them to recipients. 11. In view of the above and for the reasons stated above, it cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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