TMI Blog2019 (11) TMI 1232X X X X Extracts X X X X X X X X Extracts X X X X ..... t the order of Ld.Commissioner of Income Tax(Appeals)-40, New Delhi dated 21.09.2016 for the assessment year 2012-13. 2. Grounds raised by the Revenue read as under: 1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in law in ignoring the fact that the activities of assessee is advancement of any other object of public utility and hits by the proviso of section 2(15) of the I.T.Act. 2. The appellant craves leave to add, to alter or amend any ground or appeal raised above at the time of hearing. 3. Brief facts of the case are that the assessee, a society, was established in 1982 under Societies Registration Act, 1860 and was granted registration under section 12A of the Income-tax Act, 1961 ( the Act ) vide order dated 03.09.1983. The society was also granted exemption under section 80G of the Act. From the beginning itself, the society is, inter-alia engaged in providing education and promoting research, training and education for peoples participation in developmental processes nationally and internationally. In the assessment year 1984-85, claim of the society ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see is covered in favour of the assessee by the decision of Tribunal for A.Y. 2009-10 dated 27.05.2016 and also by the Hon ble Delhi High Court in ITA No.845/2016 and CM.No.43732/2016 dated 25.11.2016. We find that the Hon ble Tribunal for A.Y. 2009-10 vide para 6.5 to 8 has held as under: 6.5 From the aforesaid, it is apparent that the activities of the appellant have been accepted to be within the scope of education under section 2(15) of the Act and also under section 10(22) of the Act. In such circumstances, the conclusion of the Assessing Officer to hold that the activities of the assessee are not in the nature of education only on the pretext that income from education is confined to Distance Learning course fee of ₹ 20.65 lacs out of total receipts of ₹ 21.45 crores is incorrect. On the contrary, we notice that the activities of the appellant are in the nature of participatory research. In the order of assessment of the appellant for assessment year 1983-84, it has been observed that the participatory research is a new development of the last decade and was arisen out of the experience of grassroots educational efforts in the Thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessee will also hold discussion with officials of leprosy mission. Page No. 10/A of the annual reports contains the relevant activities and page 19C contains photograph depicting the plans. For the Plan International ( a child rights organization working to elevate child poverty) the objective is to understand the CC based microplanning through classrooms and field based training evolves a process and identity mythology for a participatory needs assessment to develop line centered community level microplan and field work etc., page Nos. 18/19A of the annual report contains the relevant activities and photographs depicting therein online high and micro level planning for UNICEF, the task of the assessee involve fixing understanding the living condition of the tribal people and dynamics of their social exclusion (page No. 16 of the annual report contains the relevant activities and photographs depicting the immersional lending program). For international labour office (ILO), the task of the assessee is to carry out rapid assessment on the vulnerability of workers to bondages/labour exploitation in Tamilnadu by organizing separate works job/consultation meetings with employ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #39;s meeting. It is also not the case of the department that any part of profit or gain shown as receipt over expenditure has been transferred to any member of the society. Thus, the activity of the assessee society is certainly not for making profit and it is certainly not in the nature of any trade, business or commerce, so as to be headed by the first proviso to sec. 2(15) of the Act even if it is treated as advancement of any general public utility. Similar are the facts in the case of Society for Essential Health Action Training (supra). In that case also, the assessee had received an amount of ₹ 42 lacs from SAS for research conducting on implementation of various medicine related to children invocation. This research was part of the research activities which were to be carried out by SAS, but SAS could not carry out. This research was carried out by the assessee society in pursuance of a written arrangement with SAS. As per the arrangement/agreement, the assessee provided techno-medical research support and compilation of DATA in a project called ROTA VIROS . In consideration thereafter, SAS agreed to pay the assessee a lump sum amount of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s thereafter following the ratio laid down by the Co- ordinate Bench of the ITAT in the case of Harnam Singh Harbans Kaur v. DIT (Exemption) [2012] 49 SOT 387/17 taxmann.com 103, Delhi, the ITAT upheld the action of the Learned CIT(Appeals). As per the cited decisions, charitable institution registered under sec. 12A of the Act and carrying the activities in the nature of charity, cannot be held to be engaged in the activity of advancement of any other object of general public utility. 19. Similar view has been expressed by the Hyderabad Bench of the ITAT in the case of GVK EMRI (UP)(supra). Similar are facts in the case of assessee as most of the NGOs related to WHO/UNO etc. do not have any experience of connecting/collecting the poor and needy people like destitute orphans, sex workers, drug addicts in which assessee society has gained experience over a period of time and has capacity to collect these particulars classes of people and motivate them to get out of it. Besides, there is no change in the activity of the assessee which all along has been covered under the first three limbs of charitable activities laid down under sec. 2(15) of the Act as in the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s it is not charging any fee from the beneficiaries who belong to the poor communities. The ITAT also noted that the NGOs like the WHO, UNICEF etc. which have engaged the Assessee are themselves charitable instructions. They ensure that the grants given to the Assessee are utilized for the purpose of charitable activities and not for any business. The consultants fees were also paid out of such grants. Further, the Revenue was not able to show that any part of the profit or gains has been transferred to any member of the Assessee society. 7 As regards the basis of surplus, the Hon ble Apex Court in the case of Queen s Educational Society v. CIT 372 ITR 699 has referred to the judgment in the case of American Hotel Lodging Association, Educational Institute v. CBDT 301 ITR 86 (SC) and noted as under: 11. Thus, the law common to Section 10(23C)(iiiad) and (vi) may be summed up as foll0ws: (1) Where an educational institution carries on the activity of education primarily for educating persons, the fact that it meaks a surplus does not lead to the conclusion that it ceases to exist solely for educational purposes and becomes an i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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