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2018 (11) TMI 1645

well as other concerns which has similar nature of business as those of the members of the assessee society. - HELD THAT:- From the objects of the assessee society, it is evident that such trading activity indulged by the assessee society is not mentioned in the objects of the assessee society. The activity of the assessee society viz., procuring raw materials from abroad and distributing the same will amount to pure commercial transaction because it is purely a trading activity generating substantial profits. There is no element of charity in this kind of activity indulged by the assessee society. It is not a case where the assessee had imported raw materials and distributed the same amongst its members and other commercial entities having .....

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assessee is not charitable in nature but purely commercial. 3. The brief facts of the case are that the assessee filed its return of income for the assessment year 2012-13 on 28.09.2012 admitting Nil income by claiming it to be Public Charitable Society registered U/s.12AA of the Act. The case was selected for scrutiny and notice U/s.143(2) & 142(1) of the Act was issued on 23.09.2013 & 18.06.2014 respectively. Finally assessment order was passed U/s.143(3) of the Act on 27.03.2015 wherein the Ld.AO held that the activity of the assessee s trust is not charitable in nature by virtue of the proviso to Section 2(15) of the Act and thereby brought the entire income of the assessee under the ambit of tax. 4. At the outset, the Ld.DR su .....

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pure commercial transaction because it is purely a trading activity generating substantial profits. There is no element of charity in this kind of activity indulged by the assessee society. It is not a case where the assessee had imported raw materials and distributed the same amongst its members and other commercial entities having same kind of business on cost to cost basis. The activity carried out by the assessee at the most benefit the members of the assessee society and certain commercial entities having same kind of business as that of the members of the assessee society and the public who purchases the produce of these entities. Hence this venture of the assessee society cannot be inferred beyond the scope of Advancement of any oth .....

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