TMI Blog1995 (7) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... nd are not trading receipts ? " The brief facts of the case are : The respondent is a registered society of the employees of S. R. M. T. Staff Association. It was registered on August 21, 1963. During the periods ending on December 31, 1979, December 31, 1980, and December 31, 1981, the respondent-association collected certain amounts from various businessmen for bringing out a souvenir requesting them to send their advertisements for publication in the said souvenir. Though the advertisements were collected during the period of three years, it appears that the souvenir was ultimately published in the year, 1981. The Income-tax Officer assessed to tax the difference of the amount received and the expenses, amounting to Rs. 99,001, treatin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to our notice the provisions of clause (24) of section 2 of the Income-tax Act in support of his contention that the said receipts by the assessee cannot be treated as "income". He argues that this was not a case where the association was publishing a souvenir every year and collecting contributions, that though the amounts were collected during the period of three years, the souvenir was brought out only in one year and that it shows that the businessmen have given the amounts as voluntary contributions and not as consideration for advertisements and, therefore, the view of the Tribunal requires approval of this court. The respondent-association claimed the status of a charitable institution, but that claim was negatived by the Income-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion established wholly or partly for such purposes, or by an association or institution referred to in clause (21) or clause (23), or by a fund or trust or institution referred to in sub-clause (iv) or sub-clause (v) of clause (23C), of section 10 : Explanation.---For the purposes of this sub-clause, 'trust' includes any other legal obligation. . . ." On a perusal of clause (iia) of the definition of "income", extracted above, it is clear that voluntary contributions received by (1) a trust created wholly or partly for charitable or religious purposes ; (2) by an institution established wholly or partly for such purposes ; (3) by an association or institution referred to in clause (21) of section 10, viz., a scientific research associat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing receipts. In Automobile Association of Bengal v. CIT [1968] 69 ITR 878 (Cal), the Automobile Association of Bengal was publishing a monthly magazine for the benefit of its members and for that purpose it used to receive advertisements both from the members as well as non-members. There the question was whether there was a mutuality between the contributors to the funds and the participators in the funds. The Calcutta High Court held that to attract the principle of mutuality, there must be an identity between the contributors to the fund and the participators in the fund. The assessee-association was accepting money from some of its members by way of advertisement charges and was making profit out of it, which increased the funds of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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