TMI Blog2008 (11) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant : Ms Prem Lata Bansal with Mr M. P. Gupta and Mr Sanjeev Rajpal For the Respondent : Mr Piyush Kaushik CORAM:- HON'BLE MR JUSTICE BADAR DURREZ AHMED HON'BLE MR JUSTICE RAJIV SHAKDHER BADAR DURREZ AHMED, J (ORAL) 1. The present appeal under Section 260-A of the Income Tax Act, 1961 (hereinafter referred to as the "said Act") impugns the order dated 25.04.2008 passed by the Income Tax Appellate Tribunal whereby the Director of Income Tax (Exemptions) was directed to accord registration to the assessee society under Section 12A of the said Act. 2. The appeal before the Tribunal was preferred by the assessee, being aggrieved by the order passed by the Director of Income Tax (Exemptions), refusing to grant registration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o stipulates that no profit shall be paid or transferred directly or indirectly by way of dividends, bonus, profits or in any manner whatsoever to the present or the past members of the society or to any other person claiming through any one or more of the present or the past members. And, that no member of the society shall have any personal claim on any movable or immovable property or profit or accumulation of the society by virtue of the membership. 4. As per clause 3.1 of the rules and regulations, the membership of the society is open to Japanese companies and Japanese government institutions in India which have a direct or indirect interest in the aims and objects of the society and desire to become a member of the society subjec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shed for a charitable purpose and was, therefore, not entitled for registration. He also held that the beneficiaries of the society are not likely to be the Indian public or a segment thereof. 6. As indicated above, the assessee, being aggrieved by the said order preferred an appeal before the Income Tax Appellate Tribunal, which considered all the aims and objects in detail. The finding returned by the Tribunal is that the object Nos. 1 and 2 were the main objects of the assessee society and the other objects were ancillary and incidental in nature. With regard to object No. 4, the Tribunal noted that it was for the purposes of promoting education of young Japanese and education, per se, is a charitable purpose as indicated in Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nstitutions which alone could be members of the society. It was held that the society had been formed to promote development of trade and commerce between India and Japan and to facilitate economic cooperation between the two countries. Promotion of trade and commerce and industry between India and Japan would undoubtedly also benefit the Indian public at large. Consequently, the Tribunal held that the Director of Income Tax (Exemptions) was not justified in saying that the Indian public or any segment thereof would not be benefited by the activities of the society. 8. The Tribunal also took note of the fact that in the event of dissolution of the society, the members are not to receive any of the proceeds thereof. In fact, the proceeds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hould be limited to the Indian public. With regard to the charity being in India, there is no doubt that the assessee society is registered in India. With regard to the benefit accruing to the public in India, although we do not find any statutory stipulation to this effect, the factual position is that the benefit would be derived by the public in India. It is also required to be noted that the question which arises in the present appeal relates only to the registration of the assessee as a society under Section 12A/ 12AA of the said Act. The question of exemption under Section 11 and 12 is to be dealt with separately by the Assessing Officer at the time of assessment for each year. In case any income of the assessee is applied outside In ..... X X X X Extracts X X X X X X X X Extracts X X X X
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