TMI Blog2018 (4) TMI 1198X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT has erred in rejecting the application for registration u/s 12AA filed by the assessee. - Decided in favour of assessee. - ITA No.6077/Del./2015 - - - Dated:- 19-4-2018 - SHRI G.D. AGRAWAL, PRESIDENT AND SHRI KULDIP SINGH, JUDICIAL MEMBER For The ASSESSEE : Shri S.K. Sarkar, CA For The REVENUE : Shri S.R. Senapati, Senior DR ORDER PER KULDIP SINGH, JUDICIAL MEMBER : The appellant, Association of Third Party Administrators (hereinafter referred to as the assessee ) by filing the present appeal, sought to set aside the impugned order dated 17.09.2015 passed by Ld. CIT (Exemptions), Delhi on the ground that :- The learned Commissioner of Income Tax (Exemptions) has erred in refusing to grant registration u/s 12AA (1)(b) r.w.s. 12A of the Income-tax Act, 1961. 2. Briefly stated the facts necessary for adjudication of the controversy at hand are : Applicant/Assessee, Association of Third Party Administrators (ATPA) initially moved an application on 12.12.2005 in Form No.10A seeking registration under section 12A of the Income-tax Act, 1961 (for short the Act ) which was rejected by DIT (E). Applicant had filed an appeal before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , insurance underwriting, etc.; ( xi) To promote and create awareness for healthy living and to bring together all persons who subscribe to this common cause; ( xii) To educate members about health insurance and comprehensive medical services; ( xiii) To interact with various regulatory and other public and private sectors bodies for framing health-related and other beneficial schemes for people in general and those below the poverty line, and also participate in implementation of such schemes whether as consultants, advisors or otherwise. The Trust may also devise such packages as are of benefit to its members; ( xiv) To publish books, periodicals and other literature in any subject of medical science, healthy living and insurance which may be of interest to its members; ( xv) To document all relevant information pertaining to health and hygiene; ( xvi) To advise and if needed assist the Government in the formation and implementation of policies relating to health and other areas of insurance; ( xvii) To promote education, research, training and professional development on health related issues; ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tels, restaurants and other amenities for its members; ( xxxi) To maintain and keep in good repair all buildings and common services; ( xxxii) To constitute or cause to be constituted Regional Centres at convenient places to promote the objectives of the Trust; ( xxxiii) To sell, give on lease or hire any property of the Trust; ( xxxiv) To promote National Unity and International Peace and Amity; ( xxxv) To aim towards Communal and Social Harmony and Brotherhood; ( xxxvi) To undertake evaluation of Economic and Social projects; ( xxxvii) To engage in any other lawful activity which may be conducive to the promotion or attainment of any or all objects of the Trust. 6. The ld. CIT (E) proceeded to decline the registration u/s 12A of the Act by relying upon the selective aims and objects that the organisation is aiming at industry status for TPA business and to organize, train and work for betterment of TPA members and their employees and benefits are being derived by its members only. However, when we examine aims and objects in entirety ATPA is also working towards developing new products related to h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... muna Expressway Industrial Development Authority (2017) 395 ITR 18 (All.) has held that it is not within the purview of Commissioner to examine whether the assessee was entitled to exemption u/s 11 or 12 since that was within the jurisdiction of AO and not the Commissioner (E). Hon ble High Court further held that, A body or institution which is functioning for advancement of objects of general public utility and whose activities are not in the nature of trade, business or commerce or sheer profit making, is entitled to claim itself to be constituted for charitable purposes and seek registration under section 12A(1) of the Income-tax Act, 1961. Charitable purpose primarily means that the predominant object must be to promote welfare of general public. An ancillary activity, if any, to that general one performed by the institution would not render such institution noncharitable . 10. Hon ble Delhi High Court in case cited as PHD Chamber of Commerce Industry vs. DIT (E) (2014) 265 CTR (Del.) 318 while dealing with the identical issue held as under :- Held: By rendering specific services to members and non-members for a fee, a trade, professional or sim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e considered view that the applicant trust cannot be said to be engaged only for TPA members and their employees and working for mutual benefits of its members, but its objects are certainly aimed at providing benefit to the general public in the field of insurance and health facilities. No doubt, activities of the TPA which is a trade association for TPA business for the benefits of its members and non-members, but it is established to protect the interest of TPA members and work towards developing new products related to health insurance or insurance company and to structure the TPA fees, which is like Chambers of Commerce and Industry. So it is certainly providing services to the insurance sector, which in return benefits the public at large. Moreover, at this stage, the Commissioner (E) was not empowered to examine whether the assessee was entitled for exemption u/s 11 or 12 as this issue was required to be examined at the time of assessment. 13. In view of what has been discussed above, we are of the considered view that ld. CIT has erred in rejecting the application for registration u/s 12AA of the Act filed by the assessee. Consequently, the appeal filed by the assessee i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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