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TMI Blog2019 (6) TMI 1516X X X X Extracts X X X X X X X X Extracts X X X X ..... ,500/- was declared by the assessee as its total income while the income earned from sale of publications as well as organizing exhibitions in the form of Stall rent, entry tickets charges etc. amounting to Rs. 10,99,314/- was claimed to be exempt under section 11 of the Act on the ground that the same was generated from the activity of advancement of any other object of "General Public Utility". During the course of assessment proceedings, the claim of the assessee for exemption under section 11 was examined by the Assessing Officer. On such examination, he noted that section 2(15) was amended w.e.f. A.Y. 2009-10, whereby it was provided that the advancement of any other object of general public utility shall not be a charitable purpose, if it involves the carrying on of any activity in the nature of trade, commerce or business, or any activity of rendering any service in relation to any trade, commerce or business, for a cess or fee or any other consideration, irrespective of the nature of use or application, or retention, of the income from such activity. He also referred to section 28(iii) of the Act, which specifically provided that profits and gains of business or profession ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he business and that in the course of such business specific services must be rendered for its members. Section 28(iii) has introduced to cut at the mutuality principle being relied on in support of a claim for exemption. But on perusal of assessment order, it shows that the institution organised leather export promotion and had made arrangement for stall on payment of some rent and charged minimum entry ticket fees from the general public who came to visit the stalls. The services, in this case, are limited to the persons who are engaged in leather business. Though the appellant claimed that it was for general public utility, general public has nothing to do with the leather export business only the concerned persons who engaged in leather trade are participants in the business. It is clear that it was for taking care of those persons only who are engaged in leather export business. The appellant has not established that it was' for the purpose of general public utility and for public at large. The stalls are allotted and fee charges from those persons who are engaged in leather business and activity is done for promotion of leather business only. The appellant has not been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecifically the reasons given by the Assessing Officer as well as by the ld. CIT(Appeals) in their respective orders for denying such claim, it is observed that there are various judicial pronouncements that are cited by the ld. Counsel for the assessee, which fully support the assessee's case of the issue under consideration. It is pertinent to note that registration under section 12A was granted to the assessee by the Income Tax Department after considering its objects which, inter alia, included "to assist and encourage the application of science and scientific methods to the manufacture and utilization of leather and allied products by the publication of journal and other literature or by the holding of meeting from time to time, or otherwise to organize exhibitions, symposium etc. for defusing among the technologists knowledge and information relating to leather and allied industries to create public interest in leather science by organizing popular scientific talks and by defusing basic and applied scientific knowledge and in pursuance of these objects, which were considered as charitable while granting registration under section 12A to the assessee, exhibitions were organized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 11. Section 2(15) which incorporates the definition of "charitable purposes" simply shows that several mutual associations may also fall within the definition. The receipts derived by a chamber of commerce and industry for performing specific services to its members, though treated as business income under Section 28(iii) would still be entitled to the exemption under Section 11 r.w.s. 2(15) of the Act, provided there is no profit motive, Thus assessee being a charitable Institution carrying on the object of promotion and development of trade and commerce and which is not involved in the carrying on of any activity in the nature of business, the said section 28(iii) of the Act does not apply. 38. In view of the above discussion, we are of the considered view that in the given facts and detailed reading of the various judicial decisions through the years, interpreting the definition of "charitable purpose" as laid out in section 2(15) of the Act and also the definition of "business" in relation to the said section amply revels that the theory of dominant purpose has always, all through the years, been upheld to be the determining factor laying down whether the Instit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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