INCOME TAX OFFICER, WARD-11(1), PUNE, PUNE V. MAHARASHTRA CRICKET ASSOCIATION, PUNE, PUNE

ITA 694/PUN/2023

AI Insights

The case involves the Maharashtra Cricket Association (MCA), which is a charitable trust registered under the Bombay Public Trust Act and the Societies Registration Act, 1860. The dispute centers on the assessment year 2010-11, where the Deputy Commissioner of Income Tax (Exemptions) contested the CIT(A)'s decision that favored MCA regarding the nature of receipts and exemptions under sections 11 and 12 of the Income Tax Act. The Revenue argued that the CIT(A) erred in treating the receipts from BCCI as capital receipts and allowing exemptions without considering the Supreme Court's decision in ACIT(E) Vs. Ahmedabad Urban Development Authority, which suggested that such receipts could be commercial in nature. The Tribunal noted that the CIT(A) did not consider the Supreme Court's judgment available at the time of the decision and restored the matter for fresh evaluation.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 633478 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-06-2025
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Other Referred Cases: ACIT(E) Vs. Ahmedabad Urban Development Authority, Director of IT (Exemption) vs. Gujarat Cricket Association, Gujarat Cricket Association vs. Jt. CIT (Exemption), Ponni Sugars vs. CIT, Sahney Steel & Press Works Ltd. vs. CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AMOL KHAIRNAR
• Assessee Lawyers: C. H. NANIWADEKAR
• Keywords: Set aside; Reasonable cause; Depreciation; Capital receipt; Capital expenditure; Competent authority; Charitable institution; Cancellation of registration; Benefit of exemption
• Section: 143(3); 142(1); 11; 12AA; 12A; 12; 10

Judgement Text

" आयकर अपीलीय अधिकरण “ए” न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI MANISH BORAD, ACCOUNTANT MEMBER AND MS. ASTHA CHANDRA, JUDICIAL MEMBER आयकर अपील सं. / ITA No.694/PUN/2023 धििाारण वर्ा / Assessment Year : 2010-11 Dy. Commissioner of Income Tax, (Exemptions) Circle, Pune Vs. Maharashtra Cricket Association, Nehru Stadium, North Side, Tilak Road, Pune-411002 PAN : AAATM2192D अपीलार्थी / Appellant प्रत्यर्थी / Respondent Assessee by : Shri C.H. Naniwadekar Department by : Shri Amol Khairnar Date of hearing : 14-05-2025 Date of Pronouncement : 09-06-2025 आदेश / ORDER PER ASTHA CHANDRA, JM : The appeal filed by the Revenue is directed against the order dated 12.11.2022 of the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi [“CIT(A)”] pertaining to Assessment Year (“AY”) 2010-11. 2. The Revenue has raised the following grounds of appeal : “1. On facts and circumstance of the case, the Ld. Commissioner of Income Tax(Appeals) (hereinafter CIT(A) in short) erred in holding the receipt of subsidy/ grant from the BCCI by the assessee as a capital receipt, without appreciating the facts of the case and the landmark decision of the Hon'ble Supreme Court of India in respect of Sports Associations in ACIT(E) Vs. Ahmedabad Urban Development Authority in Civil Appeal No. 21762 Of 2017 dated 19.10.2022, wherein the Hon'ble Apex Court has opined that the Tribunal as well as the High Court fell into error in accepting at face value the submission that the amounts made over by BCCI to the Cricket Associations were in the nature of subsidy. 2. On facts and circumstance of the case, the Ld. CIT(A) erred in allowing the benefit of exemption u/s 11 of the I.T. Act to the assessee, without appreciating the facts of the case and the ratio laid down by the Hon'ble Supreme Court of India in respect of Sports Associations in ACIT(E) Vs Ahmedabad Urban Development Authority (Supra). 3. On facts and circumstance of the case, the Ld. CIT(A) erred in allowing the exemptions claimed u/s 11 & 12 of the Act, without appreciating the fact that the issue of assessee's 12AA registration matter is still pending before the Hon'ble Bombay High Court for adjudication. 2 ITA No.694/PUN/2023, A.Y. 2010-11 4. The appellant craves leave to add, alter, amend or omit any or all the grounds of appeal.” 3. Briefly stated, the facts are that the assessee is a charitable trust registered under the Bombay Public Trust Act and the Societies Registration Act, 1860. It continues to hold registration u/s 12A of the Income Tax Act, 1961 (the “Act”) with effect from 9th December, 1991 till date. The main object of the assessee is “to encourage physical education, foster and maintain friendly cordial relationship through sport tournaments and competitions in connection therewith and to create a healthy spirit in the country through the medium of sports in general and cricket in particular.” For AY 2010-11, the assessee filed its return of income on 30.09.2010 declaring total income at Rs. Nil claiming exemption u/s 11 of the Act. The case was selected for scrutiny under criteria, \"cases claiming exemption of income as a result of registration u/s 12AA or approval u/s 10(23C) require scrutiny to examine whether these continue to be eligible for such exemptions after amendment to definition of the term 'charitable purpose' u/s 2(15) of the Act\". Accordingly, notice(s) u/s 143(2) and 142(1) along with questionnaire were issued by the Ld. Assessing Officer (“AO”) calling for the requisite details in response to which the assessee filed its reply/ written submission(s) from time to time. 3.1 During the course of assessment proceedings, the Ld. AO noticed that the assessee in its return for the relevant AY 2010-11 has shown income from other sources of Rs.35,89,11,665/-. This constitutes subsidy for shares in TV rights from BCCI of Rs.18,63,99,133/-, Addition to grants for capital expenditure of Rs.16,93,02,554/-, Annual affiliation fees of Rs.1,19,000/-, Other income of Rs.7,97,990/-, Sponsorship from BOM of Rs.3,33,333/-, Sponsorship receivable from Sil-Tech of Rs.3,45,000/-, Interest on FDs Rs.5,46,999/- and Bank interest of Rs.10,67,656/-. The assessee has shown amount applied to charitable purposes of Rs.10,05,08,183/-, accumulation @ 15% of Rs.5,38,36,750/-, depreciation of Rs.17,67,439/-, capital expenditure being application of Rs. 23,02,72,512/- and deficit brought forward of Rs.58,64,46,708/- and claimed total of these of Rs.97,28,31,592/- as deduction and arrived at total income of Rs. NIL in view of exemption u/s 11 claiming application of income of more than 85% and working deficit as per computation of total income. The Ld. AO also called for certain details / information from BCCI. 3 ITA No.694/PUN/2023, A.Y. 2010-11 He further observed that the Ld. Commissioner of Income Tax-1, Pune vide his order dated 30th July, 2012 cancelled the registration granted to the assessee trust u/s 12A of the Act with effect from AY 2009-10 on account of amendment to section 2(15) due to which the assessee does not remain to be a charitable trust and non-communication of change in objects of the trust to the income tax authority and raised specific queries in respect thereto such as nature of its activities, subsidies received, capital expenditure incurred etc. In response to the said queries, the assessee filed its written submission(s) which were duly considered by the Ld. AO but not accepted and he proceeded to complete the assessment u/s 143(3) of the Act vide his order dated 12.02.2013 disallowing the exemption of income u/s 11 and the deficit claimed by the assessee and computed the assessed income of the assessee at Rs. 25,66,36,042 as under : Income from Business 25,50,21,387 Net profit as per I & E account 8,73,33,488 Less : interest to be considered under other sources 16,14,655 8,57,18,833 Add : Grants from BCCI for capital expenditure a) For Gahunje stadium 16,32,18,949 b) For assets 60,83,605 16,93,02,554 25,50,21,387 Income from other sources Bank interest 16,14,655 16,14,655 TOTAL INCOME 25,66,36,042 4. On appeal, after considering the contentions of the assessee advanced before him during the appellate proceedings, the Ld. CIT(A)/NFAC observed that the assessee is entitled to exemption under section 11 of the Act and cannot be treated as an AOP as done by the Ld. AO on the ground that the registration granted to assessee from the year 1991 still holds the field and the amount is applied towards the charitable purposes. He, therefore, allowed the appeal of the assessee and deleted the addition(s) made by the Ld. AO including the disallowance of the claim of deficit holding that there is no merit in the addition(s) made by the Ld. AO for the reasons recorded in pars 5.1 to 5.5.2 of his impugned appellate order. 5. Dissatisfied, the Revenue is in appeal before the Tribunal and all the grounds of appeal relate thereto. 4 ITA No.694/PUN/2023, A.Y. 2010-11 6. The Ld. DR contended that the Ld. CIT(A)/NFAC has not appreciated the facts of the case in correct perspective while allowing the appeal of the assessee. He vehemently argued that the Ld. CIT(A) has adjudicated the matter without considering the decision of the Hon’ble Supreme Court in the case of Assistant Commissioner of Income Tax Vs. Ahmedabad Urban Development Authority (2022) 144 taxmann.com 78 (SC) (“AUDA’s case”) wherein the impugned issue has been elaborately dealt with by the Hon’ble Apex Court. He also brought to our attention, the decision of this Tribunal in assessee’s own case, Maharashtra Cricket Association Vs. ACIT(E), ITA Nos. 1387 & 975/PUN/2024 for AYs 2011-12 & 2012-13 wherein the Tribunal under the similar set of facts as that of the present appeal, has set aside the matter to the file of the Ld. CIT(A) to decide the issue afresh in the light of AUDA’s case and therefore requested that the present appeal should also be restored to the file of the Ld. CIT(A)/ NFAC for deciding the issue(s) afresh. He filed detailed written submission(s) before us in support of his contention(s), which is reproduced below: “Subject : Written Submission w.r.t. applicability of sec 2(15) of Income- tax Act, 1961 to the above captioned case and its implications – reg ----------------------------------------------------------------------------------------------- “1. Facts of the case: 1.1 The assessee had obtained registration as a charitable trust under section 12A of the Income-tax Act, 1961 (hereinafter referred to as the \"Act\") in the year 1991. In the AY under consideration, the AO during the assessment proceedings found that the assessee was hit by the provisions of section 2(15) of the Income-tax Act, 1961 and also that the registration granted u/s 12A had been cancelled by the CIT (E), Pune vide order dated 30.07.2012 exercising powers u/s 12AA(3). On these twin grounds, the AO denied exemption to the assessee u/s 11 and 12 of the Act. The assessee challenged the cancellation of registration u/s 12A by the CIT (E), Pune before the Hon'ble ITAT, Pune, which was pleased to grant/restore the registration earlier granted u/s 12 A of the Act. The revenue being aggrieved challenged the order of the Hon'ble ITAT, Pune restoring this registration of the assessee before the Hon'ble Bombay High Court where the appeal of the revenue stands admitted Accordingly, the issue has not reached finality and la pending adjudication before the Hon'ble jurisdictional High Court. The assessment order dated 12.02.2013 of the AO for AY 2010-11 came to be challenged before the CIT (A) by the assessee, who, on the basis of the ITAT having restored the registration u/s 12A, allowed the appeal of the assessee and thereby striking down the assessment order. 2. It is to submit that the CIT(A) while allowing the appeal of the assessee, forgot/glossed over the fact that the AO while denying the claim u/s 11 and 12 of the Act had done so on twin grounds and not only on the cancellation of registration u/s 12A. The CIT (A) completely lost sight of the fact that the AO had examined the activities of the assessee trust and that the major thrust of the AO in 5 ITA No.694/PUN/2023, A.Y. 2010-11 denying exemption u/s 11 and 12 was the applicability of the provisions of section 2(15) of the Act. Therefore, the cancellation of registration u/s 12A or its restoration by the ITAT and its pending adjudication before the Hon'ble jurisdictional High Court is not the core ingredient on which the AO has denied the exemptions under section 11 and 12 of the Act. 2.1 The apex court had already held in the case of Assistant Commissioner of Income-tax Vs. Ahmedabad Urban Development Authority [2022] 144 taxmann.com 78 (SC) that the activities of cricket associations were on commercial lines. The Supreme Court by the judgment (supra) had considered and pronounced upon the interpretation of Section 2 (15) of the Income Tax Act, 1961, in relation to charitable trusts which engage in activities that further objects of general public utility The activities and cases of various kinds of charities, trusts and organizations, including statutory corporations and bodies, regulatory bodies, non-statutory regulatory bodies, trade organizations and bodies, sports bodies and organizations, trusts, etc were considered by the court, and dealt with in the judgment. Para 253 recorded the court's summary of conclusions in relation to each such trust, charity or organization. The Supreme Court categorically held that there was no doubt that the claim of the sport associations will not fall within 'education' and will have to be examined under the fourth limb of s. 2(15) i.e. general public utility category, if it is to make a case for tax exemption. It is evident that the activities of the cricket associations are run on business lines. The associations own physical and other infrastructure, maintain them, have arrangements for permanent manpower and have well-organised supply chains to cater to the several matches they host. Many such matches are not at national level and are under-16 or under-18 matches at the regional level. However, these activities are not to be seen in isolation but are to be regarded as part of the overall scheme, and ecosystem in which the game of cricket is organized in India. Talent is spotted, at local levels and dependent on the promise shown, given appropriate exposure. On a close scrutiny of the expenses borne, having regard to the nature of receipts, the expenditure incurred by Cricket Associations does not disclose that any significant proportion is expended towards sustained or organized coaching camps or academies. Therefore, the Tribunal fell into error in not considering the nature of receipts flowing from the BCCI into the corpus of GCA and SCA - as well as other associations to determine their true character. Recent trends have shown that media rights, especially broadcasting and digital media rights have yielded colossal revenues to the BCCI. The model adopted in the last 10 years or so has been auction media rights in respect of events over a 3 or 5-year period. These media rights are not per se owned by BCCI, which but an AOP or agglomerate of at the State Cricket Associations. The stadia which form the venue for these cricket matches in relation to which media rights are transferred or licensed are owned by the State Cricket Associations. According to the BCCI self the State Associations can well bargain and enter into arrangements for the sale of such media rights. However to obtain better terms, and gain bargaining leverage a centralized form of sale of such rights has been agreed and adopted by which the BCCI auctions these rights on behalf of the State Associations. All State Associations put together are entitled to 70 per cent of the revenue le the proceeds of sale of the media nights. This may or may not be in proportion to the events hosted by each or some of the cricket associations. Yet, this forms part of the arrangement by which the consideration flowing from such commercial nights has been agreed to be shared amongst all members of the BCCI. These rights are apparently commercial. The Tribunal as well as the High Court fell 6 ITA No.694/PUN/2023, A.Y. 2010-11 into error in accepting at face value the submission that the amounts made over by BCCI to the cricket associations were in the nature of infrastructure subsidy in each case, and for every year, the tax authorities are under an obligation to carefully examine and see the pattern of receipts and expenditure. Whilst doing so, the nature of rights conveyed by the BCCI to the successful bidders, in other words, the content of broadcast nights as well as the arrangement with respect to State associations (either in the form of master documents resolutions or individual agreements with State associations) have to be examined. It goes without saying that there need not be an exact correlation or a proportionate division between the receipt and the actual expenditure. This is in line with the principle that what is an adequate consideration for something which is agreed upon by parties is a matter best left to them. These observations are not however, to be treated as final; the parties' contentions in this regard are to be considered on their merit Director of IT (Exemption) vs. Gujarat Cricket Association (2019) 184 DTR(Guj) 97: (2020) 314 CTR (Guj) 297 and Gujarat Cricket Association vs. Jt. CIT (Exemption) (2019) 183DTR (Ahd)(Trib) 367: (2019) 202 TTJ (Ahd) 409 set aside. (Paras 234, 235, 237 & 238). This judgement of the apex court was available to the CIT (A) at the time of passing the impugned order dated 12.11.2022 but the same came to be ignored thereby rendering the decision of the CIT (A) to be divorced from the finding of the apex court on the issue of activities carried out by the cricket associations. 2.2 The issue can be looked at from another angle i.e. from the angle of powers vested in the CIT (E) under section 12 AA (3) of the Act. It has been held by the Hon'ble Tribunal's that the CIT (E) is not vested with the power to cancel registration u/s 12AA(3) when the registration came to be granted u/s 12A but it could be done so in any other proceedings i.e. assessment proceedings etc. It is submitted that such an interpretation would mean that once registration. has been granted under section 12A, the same cannot be then cancelled even though the activities were not charitable in nature. It needs to be appreciated that there was a change in law in 2009 whereby section 2 (15) was brought on to the statute and where the assessee was hit by the said provisions, the assessee would still get away by doing work which cannot be held to be charitable in nature and claim exemption u/s 11 and 12 of the Act. There may not be an explicit legislation with cancellation of registration in section 12AA(3), however, an inference or reading of the provisions of the statute in the manner held by the ITAT could render otiose the provisions of section 2(15) of the Act. Accordingly, such a reading of the statute would be contrary to the legislative intention with regard to bringing section 2(15) onto the statute. 3. In view of the above, it is humbly prayed that the order of the AO be upheld. ------------------------------------------------------------------------------------------------------------------- With regard to above appeal following submission may kindly be considered: For the kind reference in the assessee’s own case Pr. CIT (Exemptions) Vs Maharashtra Cricket Association [2019] 101 taxmann.com 339 (Bombay) dated 22 Jan 2018 in total 3 substantial questions of law were raised by Revenue which are as follows: (1) \"Whether on the facts and circumstances of the case and in law, the Tribunal did not err in holding that the registration granted under Section 12A of the Income-tax Act, 1961 to avail the benefit of exemption would continue even after the assessee society was found to be regularly involved in holding various commercial tournaments on behalf of BCCI and receiving payment from BCCI for TV and other 7 ITA No.694/PUN/2023, A.Y. 2010-11 rights, which also amounted to carrying on activity in the nature of rendering services to trade, commerce or business and thus hit by the mischief of the proviso to Section 2(15) introduced w.e.f. 01.04.2009\"? (ii) \"Whether on the facts and circumstances of the case and in law, the Tribunal did not err in holding that the Commissioner was not right in invoking the provisions of Section 12AA(3) of the Act when the activities carried out by the assessee in Maharashtra under the control of BCCI was primarily commercial in nature and thereby fulfiling the twin conditions provided in Section 12AA(3) of having not carrying the activities genuinely and in accordance with objects of the trust approved.\"?. (iii) \"Whether on the facts and circumstances of the case and in law, the Tribunal did not err in holding that even after addition to the objects clauses made without intimation to the department, the registration cannot be ipso facto cancelled in terms of Sec. 12AA(3) of the Act, without appreciating the fact that registration granted under Section 12A and the benefits flowing there from, cannot continue after amending the objects without the approval of the competent authority as the registration granted is to be objects prior to such amendment\"?............ 4. Appeal is admitted on substantial question (iii) as above.\" Hence it can be seen that Ground No. 3 is still subjudiced before Hon'ble Bombay High Court. With regard to the same, kind attention is hereby drawn to the Ground of Appeal No. 3 raised by the Revenue in the instant appeal before Hon'ble ITAT Pune is reproduced below: “3. On facts and circumstance of the case, the Ld CITTA) erred in allowing the exemptions claimed u/s 11 & 12 of the Act without appreciating the fact that the issue of assessee's 12AA registration mater is still pending before the Hon'ble Bombay High Court for adjudication. Notwithstanding above in the case of BCCI VS ITO, ITA No. 1285/Mum/2010, the Hon'ble ITAT, Mumbai has held that the benefits that flow from registration of an assessee u/s 12A cannot be extended to the amended clauses of the memorandum and rules and regulations. Following observations of the referred judgement are further relied upon: 11. The learned Special Counsel, G.C. Srivastava, representing the Revenue, submitted that the admitted position is that the assessee has changed its memorandum and rules and regulations twice i.e. on 1st June 2006 and for the second time is on 21st August 2007, and that these changes in objects were not intimated to the DIT for a period of three years, on the ground of inadvertence. He pointed out that only during assessment proceedings, in an enquiry made that the amendments were informed to the Revenue authorities. He submitted that what is registered is not merely the name of the assessee but the entire objects based on the Memorandum of Association and the rules & regulations of the institution. He contended that the benefits under section 12A flows from the objects and when there are material changes in the objects, the benefit would definitely be affected. The learned Special Counsel contended that the DIT has neither cancelled the registration nor withdrawn the registration and that he has just intimated the assessee of the consequences of the changes in the objects to the assessee. He argued that on such intimation, an appeal cannot lie under section 253 of the Act. He submitted that this is a case where the assessee by his own voluntary act of changing the objects without seeking approval, cancelled the registration. He 8 ITA No.694/PUN/2023, A.Y. 2010-11 vehemently contended that when the association has been registered under section 12A, and subsequently it alters its objects and also involved in commercial transactions, it would be unreasonable to hold that the registration under section 124 still holds good. He argued that the benefit of registration cannot be extended with the newly amended objects. He argued that it is not for the assessee to decide as to whether the amendments are material or not. On merits, he submitted that the assessee has suppressed Pages-38 and 39 of the amended Memorandum and rules and regulations and that these two pages are of vital importance and for the benefit of the bench, he provided copies of the same. He pointed out that change such as Indian Premier League was added by way of these amendments. He further filed a copy of 79th Annual Report of the assessee for the year 2007-08, wherein the concept of \"DLF Indian Premier League\" was mentioned and it was stated that new standards of entertainment was sought and the project was launched as \"Manoranjan Ka Baap\". He further referred to other parts of the annual report and submitted that what is being done was something more than mere promotion of sports and this is definitely a drastic change in the object. He filed photocopy of some of the untitled report to point out that clause 6.2.4 of the regulations for players, team officials, umpires and administrators and submitted that this was amended to allow direct and indirect commercial interest in Indian League and 20:20. He submitted that when the society allowed the administrators and managers to have commercial interest, the Revenue has the right to examine whether the amended objects are of general public utility. He argued that if the assessee does not intimate such changes what would the Assessing Officer look at. He submitted that the drastic change in the objects resulted in the foundation on which the registration stood withdrawn. Alternatively, he submitted that the registration cannot be extended to the new objects. He submitted that section 124, will not be workable if changes in objects are not to be considered by the authorities. He pointed out that the DIT has not gone into by clause by clause and examination of amendments but has simply directed the assessee to file for fresh registration and also intimated the consequence of change of objects. He relied on the decision of Mumbai \"E\" Bench of the Tribunal in M/s. Sterlite Foundation v/s DIT(E). ITA nо. 5340/Mum/2009, order dated 1st January 2010, and argued that withdrawal of registration under section 124, was not held as illegal by the Bench….. ……….17. We agree with the findings of the DIT that granting of registration under section 124A means granting of registration based on the objects and by-laws of the society as filed by the assessee along with the application for registration. Grant of registration under section 124 does not mean that only the name of the society is registered. It means that the memorandum and by-laws are examined by the authorities and on being satisfied that the memorandum and by-laws fulfilled the conditions laid down under the Act, registration under section 124. is granted and this, in turn, enables the assessee to avail the benefit of sections 11 to 13 of the Act. Thus, what is registered is the society along with its memorandum and by-laws. If there are significant or material changes in the objects or bye-laws, in our opinion, it cannot be said that the registration under section 124, can be extended to those amended objects and bye-laws. Any other view would defect the very purpose of registration. The assessee has made various amendments to the Memorandum of Association as well as in the Rules and Regulations, which are placed in the paper book vide Pages-36 to 41. These changes have been highlighted during the course of hearing. We do not want to list out the amendments as the Revenue has not examined the same, clause by clause and come to any conclusion. Suffice to say that some of the amendments are 9 ITA No.694/PUN/2023, A.Y. 2010-11 material and substantive, one of them being holding ODIs and Twenty 20, any other matches, etc........ ………..21. These amendments when read together leaves us in no doubt that certain substantial and material changes have taken place to the memorandum, as well as to the rules and regulations which permit commercial interest to administrators in IPL Champion League and Twenty 20. In our opinion, the Revenue authorities definitely have a right to examine the question whether these changes in the memorandum, rules and regulations are in consonance with the provisions of the Act so as to enable the assessee to continue to claim benefit us a charitable institution under section 11, 12 and 13 of the Act. 22. We are of the opinion that the benefits that flow from registration of an assessee under section 124, cannot be extended to the amended clauses of the memorandum and rules and regulations, otherwise an absurd situation will arise. If an institution obtains registration under section 124, on a certain objects and bye-laws, examined by the DIT and thereafter, that institution amends its objects and regulations substantially, then to hold that the registration under section 12A would hold good for the amended objects and bye-laws would be against law and the scheme of the Act. Whether the amendment is substantial or otherwise, is also to be examined by the Revenue authorities and it is not for the assessee to unilaterally declare that the amendments are not drastic or substantive. If the assessee does not intimate the Revenue of the amendments on the ground that there is no statutory requirement, in our opinion, the assessee, as a consequence, cannot claim the benefit that flows under section 124 for these changed objects, otherwise it would amount to a situation where the assessee shifts the goalpost midway and continues to claim benefit. There might be no statutory requirement for intimating the DIT of the changes in the memorandum and rules and regulations but if the assessee does not fulfill its undertaking to furnish the changes, then he cannot claim automatic benefits under sections 11 to 13 of the Act for those altered objects, rules and regulations Benefits under the Act cannot be claimed unless the changes are vetted by the authorities……….. ………29. To sum up, we are of the opinion that the registration granted under section 12A, on 12th February 1996, and the benefits flowing therefrom, cannot be extended to the amended objects of the society unless the DIT examines the same and comes to a conclusion that the registration under section 124 can be extended to the revised objects, memorandum and by laws. It would be illogical to hold that once an institution is registered under section 124 no matter whatever may be the changes in the objects, rules and regulations, for any number of times, the institution should be given the benefit of section 11 to 13 of the Act, in view of the original registration granted under section 124. In our opinion, the assessee society should approach the registering authority with the changes and amendments so that the authorities could examine as to whether the amendments in question meet the requirement of law. Since the stand of the Revenue, as already stated, is that the letter dated 18th November 2009, is only advisory in nature and is not an exercise of a statutory power and that it is not a withdrawal or cancellation of registration under section 124 we hold that the appeal is not maintainable under section 253 of the Act.\" It is also a matter of fact to be known that, the impugned appellate order of CIT(A), NFAC has been passed on 12.11.2022 whereas the Hon'ble Apex Court's judgement of ACIT (Exemptions) Vs Ahmedabad Urban Development Authority (AUDA) [2022] 143 10 ITA No.694/PUN/2023, A.Y. 2010-11 taxmann.com 278 (SC) passed on 19.10.2022 was very much available before CIT(A) and the same has not been taken into cognizance. In the AUDA judgement following findings has been made by the Hon'ble Apex Court which is relevant in the instant case: \"234. It is quite evident that the activities of the cricket associations are run on business lines. The associations own physical and other infrastructure, maintain them, have arrangements for permanent manpower and have well-organised supply chains to cater to the several matches they host. Many such matches are not at national level and are under-16 or under-18 matches at the regional level. However, these activities are not to be seen in isolation but are to be regarded as part of the overall scheme, and ecosystem in which the game of cricket is organized in India. Talent is spotted, at local levels and dependent on the promise shown. given appropriate exposure. 235. On a close scrutiny of the expenses borne, having regard to the nature of receipts, the expenditure incurred by Cricket Associations does not disclose that any significant proportion is expended towards sustained or organized coaching camps or academies. Therefore, in the opinion of this court, the ITAT fell into error in not considering the nature of receipts flowing From the BCCI into the corpus of GCA and SCA-as well as other associations that are before this court to determine their true character. The ITAT appears to have been swayed by the submission that the amount given by the BCCI were towards capital subsidy. 236. To determine whether a given receipt is to be characterized as falling in the revenue or capital stream, the objective for which it is given as well as the manner in which it is utilized has to be scrutinized This aspect has been highlighted in Sahney Steel & Press Works Lid. v. CIT [1997] 94 Таxman 368/228 ITR 253/142 CTR 261 (SC)/1997 (Suppu) SCR 189 in the following terms: \"It is not the source from which the amount is paid to the assessee which is determinative of the question whether the subsidy payments are of revenue or capital nature. The first proposition stated by Viscount Simon in Ostime case [28 TC 261: (1946) 1 All ER 668) is that if payments in the nature of subsidy from public funds are made to the assessee to assist him in carrying on his trade or business, they are trade receipts.\" This has later been followed in CIT v. Ponni Sugars [2008] 174 Taxman 87/306 ITR 392/219 CTR 105 (SC)/[2008] 9 SCC 337. 237. Recent trends have shown that media rights, especially broadcasting and digital media rights have yielded colossal revenues to the BCCL The model adopted in the last 10 years or so has been to auction media rights in respect of events over a 3 or 5-year period. As discussed previously, these media rights are not per se owned by BCCI, which is but an association of persons or agglomerate of all the State Cricket Association. The stadia which form the venue for these cricket matches (in relation to which media rights are transferred or licensed) are owned by the State Cricket Associations. According to the BCCI itself, the State Associations can well bargain and enter into arrangements for the sale of such media rights. However, to obtain better terms, and gain bargaining leverage a centralized form of sale of such rights has been agreed and adopted by which the BCCI auctions these rights on behalf of the State Associations. All State Associations put together are entitled to 70% of the revenue- i.e., the proceeds of sale of the media rights. This may or may not be in proportion to the events hosted by each or some of the cricket associations. Yet, this forms part of the arrangement by which the 11 ITA No.694/PUN/2023, A.Y. 2010-11 consideration flowing from such commercial rights has been agreed to be shared amongst all members of the BCCI. These rights are apparently commercial. 238. In the light of these, the Court is of the opinion that the ITAT as well as the High Court fell into error in accepting at face value the submission that the amounts made over by BCCI to the cricket associations were in the nature of infrastructure subsidy. In each case, and for every year, the tax authorities are under an obligation to carefully examine and see the pattern of receipts and expenditure. Whilst doing so, the nature of rights conveyed by the BCCI to the successful bidders, in other words, the content of broadcast rights as well as the arrangement with respect to state associations (either in the form of master documents, resolutions o individual agreements with state associations) have to be examined. It goes without saying the there need not be an exact correlation or a proportionate division between the receipt and t actual expenditure. This is in line with the principle that what is an adequate consideration for something which is agreed upon by parties is a matter best left to them. These observations a not however, to be treated as final; the parties' contentions in this regard are to be consider on their merit. The Revenue has placed reliance on following judgements : Sr. No. Document Details Pages 1 Pr. CIT (Exemptions) Vs Maharashtra Cricket Association [2019] 101 taxmann.com 339 (Bombay) 7 - 8 2 The Board of Control for Cricket in India Vs ITO, ITA No. 1285/Mum/2010 9 - 24 3 ACIT (Exemptions) Vs Ahmedabad Urban Development Authority (AUDA) [2022] 143 taxmann.com 278 (SC) 25 - 116 Hence, in view of the observation made by the Hon'ble Apex Court w.r.t. State Cricket Associations per se the order of the CIT(A), NFAC needs to be set aside as despite the availability of the AUDA judgement before the disposal of CIT(A) order on 12.11.2022, the Hon'ble Apex Court judgement has not been considered and hence the matter requires to be restored back to the CIT(A) / AO to be decided on merit based on the directions given by Hon'ble Supreme Court of India in respect of sports associations at Para 238 of the said judgement.” 7. The Ld. AR, on the other hand, supported the order of the Ld. CIT(A)/ NFAC and argued that the Ld. CIT(A) has rightly allowed the case of the assessee considering the factual and legal matrix of the case. He argued that the findings and ratio of the AUDA’s case is not applicable to the facts of the present case for AY 2010-11 under consideration and filed the following written submissions before us contending as under : “MAY IT PLEASE YOUR HONOR. As directed by the Hon'ble Bench during the hearing held on 07.01.2025, we submit herewith our views on the grounds raised by the department and Hon'ble Supreme Court's observations in AUDA's case. 1. Issue: Infrastructure Subsidy 12 ITA No.694/PUN/2023, A.Y. 2010-11 The first issue raised by the department relates to infrastructure subsidy of Rs. Rs. 16,32,18,949 towards Gahunje Stadium and Rs.60,83,605 for specific assets allowed by the learned CIT(A) 1.1 The subject subsidy is granted by BCCI in respect of construction of Gahunje Stadium and for purchase of specific assets. (Evidence attached from Page No.10 to 22 of the paper book). 1.2 The learned CIT(A) by relying upon the Hon'ble Supreme Court's decision in case of Ponni Sugars and Chemicals Ltd [(2008) 174 Taxmann 87 (SC)] has allowed the claim of the assessee as Capital Receipts. (Ref. Para 5.5 on Page 21 of CIT(A)'s Order) 1.3 Department's ground is that the CIT(A) has allowed the claim without appreciating the decision of the Hon'ble Supreme Court in AUDA's case. 1.4 Contrary to the department's ground, the Hon'ble Supreme Court in AUDA's case has held that the purpose test is to be followed for determination of nature of receipts. The Hon'ble Supreme Court has quoted Sahney Steel & Press Works Ltd vs. CIT [(1997) 4 SCR 189) and Ponni Sugars and Chemicals Ltd [(2008) 174 Taxmann 87 (SC)] cases in this regard. (Kindly refer Para 236 of AUDA's decision: Page 90 of the paper book) 1.5 Thus, since the learned CIT(A)'s decision is in line with the Hon'ble Supreme Court's decision in AUDA's case, no interference is called for with the CIT(A)'s decision in this regard. 2. Issue: Exemption u/s 11 of the Act Ground No.2 of the department relates to the learned CIT(A)'s decision in allowing benefit of exemption u/s 11 of the Act without appreciating the ratio laid down by the Hon'ble Supreme Court in AUDA's case. 2.1 In para 238 of AUDA's decision (Ref. page 91 of the paper book), the Hon'ble Supreme Court has held that \"In each case and for every year, the tax authorities are under an obligation to carefully examine and see the pattern of receipts and expenditure and the party's contention in this regard are to be considered on their merits.” 2.2 While coming to this conclusion, the Hon'ble Supreme Court has examined the facts found in Gujrat Cricket Association's case and as well as in Saurashtra Cricket Association's case. 2.3 The Hon'ble Supreme Court has found that, these associations were receiving amounts mainly towards sale of entry tickets for various matches, advertisement money and broadcasting as well as digital rights for national and international events. 2.4 The Hon'ble Supreme Court also found that the expenses of these associations towards the stated objects of promotion of cricket were only a fraction of these receipts. 2.5 The Hon'ble Supreme Court further held that the media/broadcasting rights are in the nature of Intellectual Property Rights and the BCCI sells these rights to the broadcasters on behalf of all the associations. 2.6. As against these observations, the facts found in the assessee's case are as under; The Marashtra Cricked Association (\"MCA\") did not own any stadium/infrastructure to conduct any matches during the relevant period (Ref. Para 5.1.1 on Page 5 of the Assessment Order) 13 ITA No.694/PUN/2023, A.Y. 2010-11 BCCI has also confirmed that the MCA did not host any matches during the relevant period (Ref. Para 5.2.1 on Page 10 of the Assessment Order) Consequently, the MCA did not have any income from sale of entry tickets, corporate boxes etc. This is evident from the annual accounts of MCA also. (Ref. Page 3 of the paper-book) The MCA did not hold any Intellectual Property Rights in the form of broadcasting rights/media rights, as no matches giving rise to such rights were held by MCA during the relevant period. BCCI has also confirmed this fact. 2.7 In fact, the only major income of the MCA by of way of interest income and revenue subsidy (TV subsidy) from BCCI which is in any case offered to tax. (Ref. Page 3 of the paper book). Since MCA did not own TV rights and therefore could not be transferred to BCCI, this subsidy is in fact a voluntary contribution from BCCI. 2.8 It will also be seen that from various BCCI domestic matches held at district centres of MCA, the MCA has incurred a deficit of about Rs.3.87 Crores and has not earned any revenue. (Ref. Page 8 of the paper book). Such domestic matches did not give rise to any media rights. 2.9 The enclosed cash flow statement will also reveal that as against receipts from BCCI of Rs.35.57 Crores and interest income of Rs.32 Lacs, the assessee has spent Rs.46.04 Crores on its objects of promotion of cricket. The assessee infact has taken loans of about Rs.20 Crores in furtherance of its objects. 2.10 Since the assessee did not own any Intellectual Property Rights in form of television and media rights, there is no question of these being assigned or transferred to BCCI or BCCI negotiating on behalf of the MCA, for the simple reason that nobody can sell anything that he does not have. There is neither any contract agreement between MCA and the BCCI on MCA's record in this regard. (Ref. Para 5.1.3 on Page 7 and 8 of the Assessment Order). 2.11 All these contentions were put before the learned CIT(A) as well as the learned AO and the CIT(A) has rightly appreciated these contentions which are in line with the observations of the Hon'ble Supreme Court. (Ref. Para 230 and Para 238 of the AUDA's decision on Page 89 and 91 of the paper book). As such, no interference is called for in CIT(A)'s decision. 3. Issue: Registration u/s 12A of the Act Ground No. 3 of the department relates to the allowance of exemption u/s 11 of the Act by the learned CIT(A) without appreciating that the issue of assessee's registration u/s 12AA of the Act is still pending before the Hon'ble Bombay High Court for adjudication. 3.1 The Hon'ble CIT-1 Pune had cancelled the assessee's registration u/s 12A of the Act vide his order dated 30.07.2012 on the grounds of, The activities of the assessee are hit by the amendment to section 2(15) of the Act made through Finance Act, 2008, and Non intimation of changes in the objects clause by the assessee to the department. 3.2 Against the same, the assessee preferred an appeal before the Hon'ble ITAT Pune bench to restore the registration u/s 12A of the Act. 3.3 The Hon'ble ITAT while deciding the matter in favour of the assessee has observed that; The registration granted to the assessee u/s 12A of the Act cannot be cancelled by the CIT in terms of section 12AA (3) on the basis of the 14 ITA No.694/PUN/2023, A.Y. 2010-11 amendment to section 2(15) of the Act by way of insertion of the first proviso by the Finance Act, 2008. (Ref. Para 20 of the Hon'ble ITAT Order on Page 106 of the paper book) The import of newly inserted clauses to the object clause is not in contravention of the assessee's primary objects of promoting, developing and controlling the game of cricket in Maharashtra. Therefore, even after considering the additional objects, it does not signify that the registration granted u/s 12A of the Act is rendered nugatory. (Ref. Para 31 of the Hon'ble ITAT Order on Page 108 (backside) of the paper book) 3.4 In the result, the Hon'ble ITAT has set aside the CIT's order and restored the assessee's 12A registration dated 09.12.1991. (Ref. Para 33 of the Hon'ble ITAT Order on Page 109 of the paper book). 3.5 Consequently, the CIT (Exemptions), Pune has passed an order u/s 12AA r.w.s 254 of the Act to give the effect of the Hon'ble ITAT decision in this case wherein it has been admitted that the assessee is considered to be continuously registered u/s 12A of the Act w.e.f. 09.12.1991. (Ref. Para 5 of the CIT(E) Order on Page 119 of the paper book). 3.6 The department has filed an appeal before the Hon'ble Bombay High Court against the said Order of the Hon'ble ITAT challenging the restoration of assessee's registration u/s 12A of the Act. 3.7 The said department's appeal before the Hon'ble Bombay High Court has been admitted however, the decision of the Hon'ble ITAT on this matter has not been stayed. The matter is yet to be heard by the Hon'ble Bombay High Court. 3.8 As such, the Order of the Hon'ble ITAT restoring the assessee's registration u/s 12A of the Act still subsists and therefore, no interference is called for with the CIT(A)'s decision in this regard.” 8. We have heard the Ld. Representatives of the parties and perused the material on record, written submission(s) of Ld. AR and Ld. DR, the paper book filed by the Ld. AR on behalf of the assessee as well as the judicial precedents relied upon by the parties. The facts on record are not in dispute. It is a matter of fact that the assessee has been regularly filing its return of income and has been subjected to scrutiny assessment in previous AYs i.e. 2002-03, 2003-04, 2004-05, 2008-09, 2009-10. In all these assessment years, the objects of the trust have been found to be charitable in nature (even post amendment to section 2(15) of the Act) by the Ld. AO including the immediate preceding year i.e. AY 2009-10. We find that the Ld. AO during the relevant AY 2010-11 under consideration has denied the assessee’s claim of exemption u/s 11 of the Act by applying the amended provisions of section 2(15) of the Act holding that the activities carried out by the assessee are not charitable in nature. The Ld. CIT(A) has allowed the exemption and deficit claimed by the assessee for the reason that the registration granted to the assessee u/s 12A of the Act since 1991 still continues to hold the field inspite of the fact that the 15 ITA No.694/PUN/2023, A.Y. 2010-11 Department is in appeal before the Hon’ble Bombay High Court on the said issue which is still sub-judiced. Before us, the main thrust of the Ld. DR’s argument is that the Ld. CIT(A)/NFAC has failed to consider the decision of the Hon’ble Supreme Court in AUDA’s case whereas in contrast to this, the Ld. AR has strongly argued that the AUDA’s case is not applicable to the factual matrix of the present case. We find some force in the arguments of the Ld. DR that the Ld. CIT(A) has failed to take into account the observations made by the Hon’ble Supreme Court in AUDA’s case vis-à-vis the nature of activities/receipts of the assessee trust before arriving at the conclusion that the assessee is eligible for claim of benefit of section 11 and 12 of the Act. We note as a matter of fact that the impugned appellate order of the CIT(A)/ NFAC has been passed on 12.11.2022 whereas the Hon'ble Apex Court's judgement in AUDA’s case was pronounced on 19.10.2022 and hence this decision was very much available before CIT(A) but the same has not been taken into cognizance. The Ld. DR has also brought to our attention the decision of this Tribunal in assessee’s own case for AYs 2011-12 & 2012-13 ((supra)) and requested that the present appeal should also be restored to the file of the Ld. CIT(A) for deciding the issue(s) afresh. Perusal thereof, reveals that the Tribunal in its decision (supra), under the similar set of facts as that of the present appeal, has set aside the matter to the file of the Ld. CIT(A) to decide the issue afresh on merits in the light of the observation(s) of the Hon’ble Apex Court in AUDA’s case. 9. Based on the factual and legal position enumerated above, in our considered view, the impugned issue(s) before us needs to be examined in light of the observations of the Hon’ble Supreme Court in AUDA’s case taking into consideration the facts and merits of the assessee’s case for the relevant AY 2010-11 under consideration. Considering the totality of facts and in the circumstances of the case, we deem it fit and proper, to set aside the impugned order of the Ld. CIT(A/ NFAC and restore the matter to his file for denovo adjudication on merits of the case in light of the decision of the Hon’ble Supreme Court in AUDA’s case, as per fact and law after allowing reasonable opportunity of hearing to the parties. The assessee is also hereby directed to file its submission(s) to substantiate its case before the Ld. CIT(A) on the appointed date without seeking adjournment under any pretext unless otherwise required for the reasonable cause, failing which the Ld. CIT(A) shall be at liberty to pass appropriate order as per 16 ITA No.694/PUN/2023, A.Y. 2010-11 law. We direct and order accordingly. The grounds No. 1 to 3 raised by the Revenue are accordingly allowed for statistical purposes. 10. In the result, the appeal of the Revenue is allowed for statistical purposes. Order pronounced in the open court on 09th June, 2025. Sd/- Sd/- (Manish Borad) (Astha Chandra) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; दिन ांक / Dated : 09th June, 2025. रदि आदेश की प्रधिधलधप अग्रेधर्ि / Copy of the Order forwarded to : 1. अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT concerned. 4. दिभ गीय प्रदिदनदि, आयकर अपीलीय अदिकरण, “ए” बेंच, पुणे / DR, ITAT, “A” Bench, Pune. 5. ग र्ड फ़ इल / Guard File. //सत्य दपि प्रदि// True Copy// आिेश नुस र / BY ORDER, िररष्ठ दनजी सदचि / Sr. Private Secretary आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune "