TMI Blog2018 (2) TMI 966X X X X Extracts X X X X X X X X Extracts X X X X ..... ance of the assessee are directed against two orders of the Commissioner of Incometax, passed u/s 263 of the Income-tax Act, 1961, both dated 22.07.2016. The relevant assessment years are 2012-2013 and 2013-2014. 2. Common issues are raised in these appeals, hence they were heard together and are being disposed off by this consolidated order. Identical grounds are raised for both the appeals, except for variance in figures. The grounds relating to assessment year 2012-2013 are reproduced below:- 1. The impugned order of the learned Commissioner of Income Tax (Exemptions) Kochi, passed under section 263 of the Income Tax Act, 1961 is opposed to law, weight of evidence, probabilities, facts and circumstances of the Appellant's case. 2. The show cause notice issued under section 263 of the Act and consequent to order passed under section 263 of the Act is bad in law and without jurisdiction on various reasons on the facts and circumstances of the case. 3. The learned Commissioner of Income-tax (Exemptions) has grossly erred in revising the order passed by the learned Assessing officer without appreciating that there is no error, much less prejudicial to the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w on the facts and circumstances of the case. 9. The learned Commissioner of Income-tax (Exemptions) is not justified in law in holding that the submission of the appellant that the assessment order passed under section 143(3) of the Act is not erroneous and not prejudicial to the interest of the revenue are not at all convincing, without giving any reasons in the order passed under section 263 of the Act is not in accordance with law on the facts and circumstances of the case. 10. The learned Commissioner of Income-tax (Exemptions) is not justified in law in holding that the appellant has engaged in activities in the nature of rendering services in .relation to a purely commercial activity' and the proviso to section 2(15) of the Act is applicable and the appellant activities ceases to be charitable, hence the appellant is not eligible for benefits under section 11 and 12 of the Income-tax Act, 1961, and without prejudice further without giving any reasons in the order passed under section 263 of the Act in respect of the above finding is not in accordance with law on the facts and circumstances of the case. 11. The learned Commissioner of Income-tax (Exempti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ancement of substantial cause of justice and equity. 3. Briefly stated the facts of the case are as follow:- 3.1 The assessments for assessment years 2012-2013 and 2013-2014 were completed u/s 143(3) of the Income-tax Act, granting assessee, the benefit of deduction u/s 11 of the I.T.Act. Subsequently, the notice u/s 263 of the Income-tax Act was issued for denying the benefit of deduction u/s 11 of the I.T.Act. According to the CIT, assessee s activities are in the nature of trade, commerce or business and since it was getting fees or cess from such activities, the assessee would not be eligible for exemption u/s 11 of the I.T.Act. The assessee filed written submissions dated 13.07.2016 and 20.07.2016. The objections / submissions made by the assessee was rejected and the CIT passed order u/s 263 of the I.T.Act. The CIT held, the assessee is engaged in commercial activities and since the receipts are exceeding ₹ 10 lakh, the proviso to section 2(15) of the I.T.Act are applicable, and assessee s activities ceased to be charitable. It was concluded by the CIT that assessee was not eligible for deduction u/s 11 and 12 of the I.T.Act and the status of the assessee shoul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion under section 11 and 12 of the Income Tax Act and the status of the assessee should have been treated as AOP. As the Assessing Officer has failed to consider the above issues, the assessment order passed by the Assessing Officer u/s 143(3) of the Income Tax Act dated 30-12-2014 for the assessment year 2012-13 is erroneous in so far as it is prejudicial to the interests of revenue. Accordingly, invoking the provisions of section 263 of the Income Tax Act, 1961, the assessment order dated 30-12-2014 is set aside with a direction to the Assessing Officer to redo the same afresh after considering all issues raised herein above and after affording an opportunity of being heard to the assessee. 4. Aggrieved by the revisionary order passed by the CIT u/s 263 of the I.T.Act for assessment years 2012-2013 and 2013- 2014, the assessee has filed the present appeals before the Tribunal. 5. The learned Counsel for the assessee submitted, the Cochin Bench of the Tribunal in assessee s own case for assessment year 2010-2011 had held the activities of assessee would not come within the proviso to section 2(15) of the I.T.Act since the assessee was not carrying on any business, trade ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 2(15) of the Act was carried out to tax entities wearing the mask of charity but in fact carrying on commercial activities. a. In the course of budget speech for 2008-2009, Hon ble Finance Minister observed that Charitable purpose includes relief of the poor, education, medical relief and any other object of general public utility. These activities are tax exempt, as they should be. However, some entities carrying on regular trade, commerce or business or providing services in relation to any trade, commerce or business and earning incomes have sought to claim that their purposes would also fall under Charitable Purpose . Obviously, this was not the intention of Parliament and, hence, I propose to amend the law to exclude the aforesaid cases. Genuine charitable Organizations will not in any way be affected . b. The memorandum explaining the provisions of Finance Bill is to a similar effect. While replying in to a debate on the Finance Bill, the Finance Minister assured that genuine charitable institutions would not be brought within the ambit of Section 2(15). ( viii) It is relevant to point out that the statement made by the mover of the Finance bill can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs of Indian Premier League are sold in public auction for very huge amount. But the question is who is conducting and who is auctioning, whether the assesseesociety or BCCI? In fact, BCCI conducts the public auction for selling premier players at a huge premium rate. In fact, the BCCI collects the money. The role of the assessee-society is only to provide stadium for conducting matches. Other than that, the assessee-society has no role in conducting the international matches and Indian Premier League matches. 16. The other activity of the assessee-society is to conduct training programmes, coaching classes for college students at district level in the State of Tamil Nadu and in the Union Territory of Puducherry. The assessee is also conducting inter-university, interschool and inter-association matches. Expenditures involved in such activities were met out of surplus funds remaining with the assessee-society. The Assessing Officer got confused himself with the activity carried on by the BCCI as that of the activity carried on by the assessee-society. The material available on record shows that one-day matches, T-20 matches and Indian Premier League matches are all conducted ..... X X X X Extracts X X X X X X X X Extracts X X X X
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