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TMI Blog2018 (5) TMI 1775X X X X Extracts X X X X X X X X Extracts X X X X ..... see in the present case is an association of paediatric doctors. During the year under consideration, a journal was published and distributed by it to the members free of cost. The expenditure for printing of the said journal was claimed to be financed from sponsorship fees. In the return of income filed for the year under consideration on 26.11.2013, surplus of Rs. 4,58,880/- was offered to tax by the assessee. During the course of assessment proceedings, it was noticed by the A.O. that the assessee has paid printing charges of Rs. 41,59,000/- to M/s. Reed Elsevier India Pvt. Ltd. without deduction of tax at source as required under section 194C. In this regard, it was explained by the assessee that there was no business carried on by it a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from sponsorship fees and the journals published were issued to the members free of cost. It was contended that the A.O., therefore, was not justified in classifying the surplus from the said activity as business income instead of income from other sources and making a disallowance u/s 40(a)(ia) for non-deduction of tax at source from the payment of printing charges. The Ld. CIT(A) did not find merit in this contention of the assessee. He held that the assessee being a charitable organisation was of no relevance for the applicability of section 40(a)(ia) and the A.O., therefore, was fully justified in invoking the said provision to make the disallowance. Aggrieved by the order of the Ld. CIT(A), the assessee has preferred this appeal befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cost, the same cannot be treated as in the nature trade, commerce or business as envisaged in the proviso to section 2(15) and the income of the assessee from the said activity cannot be treated as its business income. I, therefore, find merit in the contention of the learned counsel for the assessee that the A.O. was not justified in reclassifying the income of the assessee from the activity of publication of journals as business income and in making a disallowance u/s 40(a)(ia). 5. In my opinion, the Ld. CIT(A) is also not justified in holding that the fact of the assessee being the charitable organisation is of no relevance for the applicability of section 40(a)(ia). As pointed out by the learned counsel for the assessee, this view take ..... X X X X Extracts X X X X X X X X Extracts X X X X
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