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TMI Blog2020 (4) TMI 716X X X X Extracts X X X X X X X X Extracts X X X X ..... the certificate of registration by Asstt. Charity Commissioners and copy of PAN Card. 3. Thereafter ld. DIT(E) and asked the assessee to submit the details charitable activities carried out by you in the past. And application of the assessee was rejected on the ground that as main object of the trust is to give benefit to the family member of the deceased members of the Rotary Club and same is not giving benefit to public at large and giving benefit to group of deceased members. 4. Assessee contended that in Memorandum of Association, it is mentioned that the trust shall be a voluntary, non-political, non profit making charitable and social services organization. " To do all necessary acts for the general welfare and upliftment of the me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r ancillary receipts during the course of carrying out its promotional activity of game of golf or for maintenance of its club and the facilities, it cannot be held to be in the nature of business, trade or commerce. From the perusal of income and expenditure account, it is seen that there is a operating deficit of 978.96 lakhs i.e. expenditures are far more than the receipts. In such a situation a club or trust does try to generate receipts to cover its expenditure which are only for fulfillment of its objects. However, such receipts should be strictly confined to attainment of its object and not for simply accumulating surplus. Thus, the embargo or rider given in proviso to section 2(15), cannot be the ground for cancellation of regis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed together and contribute to a common fund for the financing of some venture or object and in this respect have no dealings or relations with any outside body, then any surplus returned to the persons forming such association is not chargeable to tax. In such case, there must be a complete identity between the contributors and the participants. Therefore, where industry or trade associations claim both to be charitable institutions as well as mutual organizations and their activities are restricted to contributions from and participation of only their members, these would not fall under the purview of the proviso to section 2(15) owing to the principle of mutuality. However, if such organizations have dealings with non- members, their clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - Charitable or religious trust - Exemption of income from property held under - Assessment years 1960-61 to 1962-63 - Assessee, an association of persons, held properties for various purposes including management of movable and immovable properties of Rana caste or community of Ahmedabad, doing acts to improve education of community to give medical help etc. - Tribunal found that beneficiaries of assessee were members of Rana community meaning thereby natives of Ahmedabad only and other members of community accepted by caste as per old customs and usage of community and staying in Ahmedabad - Tribunal held that there being no vagueness about beneficiaries or of their public character, assessee being a charitable trust, was entitled to exem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... promote the Urologist Doctors for the mutual benefit of each other with following observation: 8. Indisputably, the respondent has moved the application before the expiry of one year from the date of its creation. In course of processing of the application, the trust was noticed to submit the books of accounts for FY 2013-14. While rejecting the application, the CIT has opined that the trust having failed to produce the books of accounts and further that the charitable activity is for promoting the Urologist so that more and more patients visit these Urologists, therefore, the society is basically in the nature of club of Urologist Doctors for the mutual benefit of Doctors who are its members, it is not entitled for registration. 9. As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner Income Tax, it is held that at the stage of Section 12A, the Commissioner is not to examine the application of income. All that he may examine is whether the application is made in accordance with the requirements of Section 12A read with Rule 17A and whether Form No.10A has been properly filled up. He may also see whether the objects of the trust are charitable or not. At this State, it is not proper to examine the application of income. 12.In the case at hand, the order passed by the CIT does not say in definite terms, that the objects of the society are not charitable in nature. Merely because the trust consists of Urologist Doctors and the charitable activity may mutually benefit those members, the object itself would not ce ..... X X X X Extracts X X X X X X X X Extracts X X X X
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