TMI Blog1976 (12) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee-association which need to be extracted are as under : " (a) To organise the proprietors of several cafes, restaurants, hotels, eating houses, etc., in the Madras City into a corporate body having a status to represent their grievances to the Corporation or the Government or other public authorities ; (b) To create and encourage friendly and brotherly feelings and unity among the members of the association ; (c) to remove as far as possible the various trade difficulties and to frame rules and regulations of conduct of members in their business transactions ; (d) to watch and protect the general, commercial and business interests of the members ; (e) to enquire into, adjust and settle disputes or controversies among the members of the association and to arbitrate in the settlement of disputes arising out of transactions between parties willing to abide by the decision of the association ; (f) to promote, modify or oppose legislative and other measures affecting the business of members ; (g) to arrange supply of proper articles of food for use of members at a cheap and uniform price through the marketing officer to the Government and co-operate with him arid oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... econd contention that the assessee-association should be deemed to be an association indulging in charitable purposes and that their commercial activity did not involve the carrying on of any activity for profit. Reliance was placed upon section 2(15) of the Income-tax Act, 1961, and the ratio in Commissioner of Income-tax v. Andhra Chamber of Commerce [1965] 55 ITR 722 (SC) was heavily pressed. In the reference before us Mr. Srinivasan placed considerable reliance on the above decision of the Supreme Court and another decision in joint Commercial Tax Officer v. Young Men's Indian Association [1970] 26 STC 241 (SC) was also pressed upon. The counsel for the department, on the facts and opposing the contentions, would distinguish the two Supreme Court cases as above and would urge that the question has to be answered against the assessee. Section 2(15) of the Income-tax Act of 1961, hereinafter called as "the Act", gives an inclusive definition to the expression "charitable purpose". A charitable purpose includes relief of the poor, education, medical relief and the advancement of any other object of general public utility not involving the carrying on of any activity for profit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so far as the years in which the assessee had sustained loss, according to their own statements, it was not even suggested that such loss has been carried forward and set off in the later years. But that question does not even arise for consideration in the reference and rightly, therefore, the Tribunal did not go into the question as to whether such losses are liable to be set off in later years. In the context of such a factual finding of the Tribunal and the reasonable impression gained on the statements of accounts filed by the assessee-association themselves, Mr. Srinivasan strenuously contended that the activity of the association would squarely come within the ratio of the two Supreme Court cases referred to above. In order to appreciate the principle in Commissioner of Income-tax v. Andhra Chamber of Commerce [1965] 55 ITR 722 (SC), it is necessary to set out the objects of the association of the Andhra Chamber of Commerce and consider it in conjunction with the objects of the association of the assessee. For purposes of convenience, the relevant clauses may be extracted one against the other. The clauses in the memorandum of The clauses in the memorandum of objects o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en in the matter of the representation, the assessee-association is interested in promoting, modifying or opposing measures which would affect the business of its members. This centrifuged patronage to the members of the association cannot be said to be a charitable purpose. It is not in dispute before us that the Andhra Chamber of Commerce produces leaflets and prints journals which are very informative for the entire commercial community in our country whilst the association has no such general interest. The usual adage that charity begins at home is very conspicuous in the objects of this association. The basis on which the Supreme Court gave relief to the Andhra Chamber of Commerce was that their main and primary objects were not vague or indefinite and it was intended to advance general public utility. Incidentally, they would observe that the expression "object of general public utility" need not be one to benefit the whole of mankind, but it is enough if it sub-serves the interests of a section of the public. If any steps are taken so as to advance such interests of trade and commerce in general which might incidentally reflect upon the interests of their own members or a se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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