Madras Orthopaedic Society, CHENNAI V. DIT, CHENNAI

ITA 1641/CHNY/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 90689 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 11 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 20-05-2015
• Assessment Year: misc
• Appeal Filed On: 12-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: G SEETHARAMAN
• Keywords: Gift; Charitable institution; Retrospective amendment
• Section: 80G; 12AA; 12; 10; 11; 15

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , A B ENCH, CHENNAI . , ! # , $ & BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ./ I.T.A.NO . 1641/MDS/2013 MADRAS ORTHOPAEDIC SOCIETY, 13/3, MANGESH STREET, T.NAGAR, CHENNAI-600 017. VS THE DIRECTOR OF INCOME TAX (EXEMPTIONS), CHENNAI-600 034. PAN:AACAM4152A ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR. G.SEETHARAMAN, C.A. /RESPONDENT BY : MR. PATHLAVETH PEERYA, CIT /DATE OF HEARING : 20 TH MAY, 2015 /DATE OF PRONOUNCEMENT : 17 TH JULY, 2015 / O R D E R PER CHALLA NAGENDRA PRASAD, JM: THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF THE DIRECTOR OF INCOME TAX (EXEMPTIONS), CHENNAI DA TED 31.05.2013 IN DENYING REGISTRATION UNDER SECTION 12 AA OF THE ACT. 2. AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE SUBMI TS THAT ASSESSEE IS A SOCIETY, REGISTERED UNDER SECTIO N 10 OF TAMIL NADU SOCIETIES REGISTRATION ACT, 1975, FORME D WITH OBJECTS OF PROPAGATION OF KNOWLEDGE OF SCIENCE OF ORTHOPAEDIC SPECIALITY, TO PROVIDE ACADEMIC TRAININ G 2 ITA NO.1641/MDS/2013 PROGRAMMES TO UPCOMING ORTHOPAEDIC SURGEONS, TO CON DUCT MONTHLY CLINICAL MEETING, TO ORGANIZE CME PROGRAMS FOR THE POSTGRADUATES ETC. THE AUTHORIZED REPRESENTATIVE S UBMITS THAT ASSESSEE SOCIETY HAS APPLIED FOR REGISTRATION UNDER SECTION 12AA OF THE ACT WITH THE DIRECTOR OF INCOME TAX(EXEMPTIONS). HOWEVER, THE DIRECTOR OF INCOME TAX(EXEMPTIONS) BY ORDER DATED 31.05.2013 DENIED REGISTRATION HOLDING THAT SOCIETY IS FORMED FOR THE BENEFIT OF ITS MEMBERS ONLY AND NOT FOR THE PUBLIC. HE SUBMITS THA T DIRECTOR OF INCOME TAX(EXEMPTIONS) ALSO OBSERVED THAT SOCIET Y IS PROVIDING SERVICES AND BENEFITS TO ITS OWN MEMBERS ONLY WHICH IS VIOLATION OF PROVISIONS OF SECTION 13(2)(B ) AND 13(2)(D) READ WITH SECTION 11 OF THE ACT. THE AUTH ORIZED REPRESENTATIVE FURTHER SUBMITS THAT IT IS THE OBSER VATION OF DIRECTOR OF INCOME TAX(EXEMPTIONS) THAT BENEFITS FR OM THE ACTIVITIES OF THE SOCIETY ARE RESTRICTED ONLY TO SU RGEONS AND THE ASSESSEE SOCIETY IS CHARGING SUBSCRIPTION FEE F ROM ITS MEMBERS. HE SUBMITS THAT DIRECTOR OF INCOME TAX(EXEMPTIONS) IS NOT JUSTIFIED IN MAKING THE ABOV E OBSERVATIONS AND IT IS A FACT THAT BENEFIT OUT OF THE ASSOCIATION IS NOT RESTRICTED TO ONLY SURGEONS AND SOCIETY IS 3 ITA NO.1641/MDS/2013 NOT A TRADE ORGANIZATION FOR DOING ANY BUSINESS, TR ADE OR COMMERCE. THE SUBSCRIPTIONS ARE COLLECTED FROM MEMB ERS AND THE SOCIETY IS ORGANIZING VARIOUS CONFERENCES A ND THE MEMBERS ARE ATTENDING AS DELEGATES AND NOT AS MEMBE RS. AUTHORIZED REPRESENTATIVE SUBMITS THAT MEMORANDUM O F ASSOCIATION OF THE SOCIETY HAS BEEN AMENDED WITH RETROSPECTIVE EFFECT PROVIDING BENEFITS NOT ONLY TO THE MEMBERS BUT ALSO TO THE GENERAL PUBLIC. WHEN IT WAS QUESTIONED BY THE BENCH WHETHER AMENDED MEMORANDUM HAS BEEN FILED BEFORE THE DIRECTOR OF INCOME TAX(EXEMPTIONS), AUTHORIZED REPRESENTATIVE SUBMITS THAT THE SAME WAS NOT FILED BEFORE HIM. HE SUBMITS THAT SIN CE THE SOCIETY IS FORMED TO PROPAGATE KNOWLEDGE OF SCIENCE OF ORTHOPAEDIC SPECIALITY AND ALSO FOR PROVIDING ACAD EMIC TRAINING PROGRAMMES FOR UPCOMING ORTHOPAEDIC SURGEO NS AND TO CONDUCT MONTHLY CLINICAL MEETINGS, CME PROGR AMS FOR POSTGRADUATES, ORGANIZE LIVE SURGERIES AND WORKSHOP S AND OTHER VARIOUS CHARITABLE ACTIVITIES, REGISTRATION U NDER SECTION 12AA CANNOT BE REJECTED ON THE GROUND THAT SOCIETY IS FORMED ONLY FOR THE BENEFIT OF ITS MEMBERS. AUTHORIZED REPRESENTATIVE PLACES RELIANCE ON THE DECISION OF C O-ORDINATE 4 ITA NO.1641/MDS/2013 BENCH OF THIS TRIBUNAL IN THE CASE OF THE CHARTERED ACCOUNTANTS STUDY CIRCLE VS. ITO(EXEMPTIONS) IN ITA NO.1971/MDS/2010 DATED 4 TH JULY, 2011, WHICH DECISION WAS AFFIRMED BY THE JURISDICTIONAL HIGH COURT IN THE CA SE OF DIT(EXEMPTIONS) VS. THE CHARTERED ACCOUNTANT STUDY CIRCLE (250 CTR 70). PLACING RELIANCE ON THESE DECISIONS, THE AUTHORIZED REPRESENTATIVE SUBMITS THAT THE SOCIETY FORMED EVEN FOR THE BENEFIT OF PROFESSIONALS, REGISTRATION UNDER SECTION 12AA CANNOT BE DENIED. 3. DEPARTMENTAL REPRESENTATIVE VEHEMENTLY SUPPORTS THE ORDER OF THE DIRECTOR OF INCOME TAX(EXEMPTIONS) IN DENYING REGISTRATION UNDER SECTION 12AA OF THE ACT. 4. HEARD BOTH SIDES. PERUSED ORDER OF THE DIRECTOR OF INCOME TAX(EXEMPTIONS) AND THE DECISIONS RELIED ON. THE ASSESSEE MADRAS ORTHOPAEDIC SOCIETY IS FORMED WITH THE FOLLOWING MAIN OBJECTS: A) PROPAGATION OF KNOWLEDGE OF THE SCIENCE OF ORTHOPAEDIC SPECIALITY. B) PROVIDE ACADEMIC TRAINING PROGRAMMES TO UPCOMING ORTHOPAEDIC SURGEONS 5 ITA NO.1641/MDS/2013 C) CREATE A SENSE OF HARMONY AND HEALTHY CO-EXISTEN CE AMONGST ORTHOPAEDIC SURGEONS WITHIN THE JURISDICTIO N OF MADRAS ORTHOPAEDIC SOCIETY AND ORTHOPAEDIC SURGEONS IN GENERAL. D) TO CONDUCT MONTHLY CLINICAL MEETING. E) TO ORGANIZE CME PROGRAMS FOR THE POSTGRADUATES F) TO ORGANIZE LIVE SURGERIES AND WORKSHOPS G) TO OFFER FELLOWSHIPS FOR DESERVING PGS & CONSULT ANTS H) TO ORGANIZE CONFERENCE AT CITY, STATE, NATIONAL AND INTERNATIONAL LEVELS I) TO DO SOCIAL WELFARE ACTIVITIES J) TO PUBLIC JOURNALS AND NEWS LETTERS K) TO HAVE OUR OWN PLACE FOR CONDUCT OF ACTIVITIES AND ALSO A LIBRARY L) TO ORGANIZE CAMPS FOR WELFARE AND CREATE AWARENE SS OF PUBLIC M) TO INSTITUTE SCHOLARSHIPS, ENDOWMENTS AND EXTENDING MONETARY HELP TO DESERVING STUDENTS FOR SCHOOL & HIGHER EDUCATION. N) TO FOSTER AND DEVELOP A FEELING OF FELLOWSHIP, G OOD FRIENDLY RELATIONSHIP AMONG MEMBERS, TO UNITE UNDER A COMMON BOND OF SUCH FELLOWSHIP AND TO PURSUE AND STRIVE FOR RECREATIONAL & CULTURAL BENEFITS OF MEMB ERS. O) TO PROMOTE PROFESSIONAL, SOCIAL, RECREATIONAL, CULTURAL, EDUCATION AND WELFARE ACTIVITIES OF MEMBE RS. P) TO DO ALL THINGS AS ARE NECESSARY OR CONDUCIVE T O ATTAINMENT OF OBJECTS OR ANY OF THEM. 6 ITA NO.1641/MDS/2013 5. ON EXAMINING THE ABOVE OBJECTS OF THE SOCIETY, W E DO NOT FIND ANY REASON TO HOLD THAT ASSESSEE SOCIETY I S FORMED FOR THE BENEFIT OF MEMBERS ONLY. DIRECTOR OF INCOME TAX(EXEMPTIONS) ON EXAMINING VARIOUS CLAUSES OF THE MEMORANDUM WHICH WAS PLACED BEFORE HIM TRIED TO SAY THAT BENEFITS ARE RESTRICTED ONLY TO THE MEMBERS AND NOT TO THE PUBLIC. IT IS THE SUBMISSION OF THE ASSESSEE THAT MEMORANDUM HAS BEEN AMENDED WITH RETROSPECTIVE EFFE CT AND BENEFITS ARE NOT RESTRICTED ONLY TO MEMBERS AND THE ACTIVITIES ARE CARRIED ON FOR GENERAL PUBLIC. WE HA VE GONE THROUGH THE DECISIONS RELIED ON BY THE AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE WHICH WAS RENDERED IN THE CASE OF THE CHARTERED ACCOUNTANTS STUDY CIRCLE, WHE RE THE STUDY CIRCLE WAS IMPARTING KNOWLEDGE TO PROFESSIONA LS AND C.A. STUDENTS . THE ASSESSEES STUDY CIRCLE WAS CA TERING IMPROVEMENT OF KNOWLEDGE THROUGH ITS ACTIVITIES AND IT WAS CONDUCTING COURSES AND SEMINARS WHICH WAS ALSO PUBL ISHING AND SELLING BOOKS OF PROFESSIONAL . THE DIRECTOR OF INCOME TAX (EXEMPTIONS) DENIED RENEWAL OF APPROVAL UNDER S ECTION 80G OF THE ACT FOR THE SOCIETY HOLDING THAT ASSESSE E DID NOT HELP THE GENERAL PUBLIC BUT ONLY CHARTERED ACCOUNTA NTS AND 7 ITA NO.1641/MDS/2013 HENCE COULD NOT BE CONSIDERED AS DOING ANY CHARITAB LE ACTIVITIES FALLING WITHIN SUB-SECTION (15) OF SECTI ON 2 OF THE ACT. 6. THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE C ASE OF THE CHARTERED ACCOUNTANTS STUDY CIRCLE VS. ITO(EXEMPTIONS) IN ITA NO.1971/MDS/2010 DATED 4 TH JULY, 2011 ON ANALYZING THE OBJECTS AND ACTIVITIES OF THE ASSESSEE HELD AS UNDER:- 5. WE HAVE PERUSED THE ORDER OF LD. DIT (EXEMPTIONS ) AS WELL AS HEARD THE RIVAL SUBMISSIONS. ASSESSEE I S A CHARTERED ACCOUNTANTS STUDY CIRCLE. ADMITTEDLY, AS SESSEE WAS CONDUCTING COURSES AND SEMINARS. ASSESSEE WAS ALSO PUBLISHING AND SELLING BOOKS OF PROFESSIONAL INTERE ST. LD. DIT (EXEMPTIONS) HIMSELF HAS ADMITTED THAT SUCH REF ERENCE MIGHT BE USED BY GENERAL PUBLIC AS WELL AS PROFESSI ONALS DOING BANK AUDIT, TAX AUDIT, ETC. THESE ACTIVITIES COULD ONLY BE CONSIDERED AS A PART OF ON-GOING EDUCATION OF CH ARTERED ACCOUNTANTS WHICH, IN TURN, WOULD NECESSARILY HELP SOCIETY TO GET BETTER, WELL-EQUIPPED AND SKILLED SET OF CHA RTERED ACCOUNTANTS FOR MAINTAINING AUDIT QUALITY. SO, WE CANNOT SAY THAT SUCH ACTIVITIES WERE IN THE NATURE OF TRAD E, COMMERCE OR BUSINESS, EVEN IF CONSIDER THE ACTIVITY DONE BY THE ASSESSEE AS ONE FOR ADVANCEMENT OF OBJECT OF GE NERAL PUBLIC UTILITY. IN ANY CASE, ASSESSEE, IN OUR OPIN ION, WAS ONLY DOING EDUCATIONAL ACTIVITY AND THE SUBSTITUTED SECTION 2(15) OF THE ACT WHICH EFFECTIVELY ADDED A PROVISO THERETO, WOULD NOT APPLY TO THE ASSESSEE SINCE SUCH PROVISO WAS APPLICABLE ONLY WITH REGARD TO CHARITABLE ACTIVITIE S IN THE NATURE OF ADVANCEMENT OF OBJECT OF GENERAL PUBLIC U TILITY. WE ARE, THEREFORE, OF THE OPINION THAT THE ASSESSEE WAS WELL ENTITLED TO APPROVAL UNDER SECTION 80G OF THE ACT. THE ORDER OF LD. DIT (EXEMPTIONS) IS QUASHED AND HE IS DIRECTED TO GRANT THE ASSESSEE RENEWAL OF ITS APPROVAL UNDER SECTION 80G OF THE ACT AS SOUGHT FOR. 8 ITA NO.1641/MDS/2013 7. THIS DECISION OF THE CO-ORDINATE BENCH HAS BEEN UPHELD BY THE JURISDICTIONAL HIGH COURT DISMISSING THE REV ENUES APPEAL OBSERVING AS UNDER:- 2. THE ASSESSEE-TRUST IS A SOCIETY KNOWN AS 'THE CHARTERED ACCOUNTANTS STUDY CIRCLE'. THE AIMS AND OBJECTS OF THE SOCIETY AMONG OTHER THINGS ARE AS FOLLOWS: 'A. TO CONDUCT PERIODICAL MEETINGS ON PROFESSIONAL SUBJECTS; B. TO PUBLISH BOOKS, BOOKLETS, ETC. ON PROFESSIONAL SUBJECTS; C. TO ORGANISE SEMINARS, CONVENTIONS, CONFERENCES, ETC., AS MAY BE DEEMED FIT FROM TIME TO TIME; D. TO MAKE REPRESENTATION TO THE CENTRAL AND STATE GOVERNMENTS, PUBLIC AND PROFESSIONAL INSTITUTIONS, ETC. ON MATTERS INVOLVING PROFESSIONAL AND SOCIAL PROBLEMS; E. TO RECEIVE AND COLLECT ANY SUBSCRIPTIONS, GIFTS AND DONATIONS, EITHER IN CASH OR IN KIND OR ACQUIRE BY ANY OTHER LAWFUL WAYS AND MEANS AND SPEND THE SAME IN FULFILLMENT OF ALL OR ANY OF THE AIMS AND OBJECTS O F THE SOCIETY. THE INCOME AND PROPERTIES OF THE SOCIETY SHALL BE APPLIED SOLELY FOR THE PROMOTION AND FULFILLMENT OF THE AIMS AND OBJECTS OF THE SOCIETY, PROVIDED IF ANY DONOR INTENDS THAT HIS DONATION SHA LL BE APPLIED TO THE ATTAINMENT OF ANY PARTICULAR OBJE CT OR OBJECTS OF THE SOCIETY, SUCH DONATION SHALL BE SPEN T TOWARDS THE PROMOTION OF THAT PARTICULAR OBJECT OR OBJECTS ONLY; AND F. TO GRANT SCHOLARSHIPS, FINANCIAL AND OTHER ASSISTANCE AND AWARDS TO DESERVING PERSONS FOR EDUCATIONAL PURPOSES, AS MAY BE DECIDED BY THE COMMITTEE.' 3. THE ASSESSEE-TRUST FILED AN APPLICATION IN FORM 10G TO THE DIRECTOR OF INCOME-TAX (EXEMPTIONS), CHENNAI FO R GRANT OF RENEWAL UNDER SECTION 80G OF THE INCOME-TAX ACT. THE SAID REQUEST WAS REJECTED ON THE GROUND THAT THE AS SESSEE WAS PUBLISHING AND SELLING BOOKS OF PROFESSIONAL IN TEREST TO BE USED AS A REFERENCE MATERIAL BY THE GENERAL PUBL IC AS WELL AS THE PROFESSIONALS IN RESPECT OF BANK AUDIT, TAX AUDIT, ETC. AND ITS ACTIVITIES ARE COMMERCIAL IN NA TURE AND WILL FALL WITHIN THE AMENDED PROVISION OF SECTION 2 (15) OF THE INCOME-TAX ACT. BEING AGGRIEVED BY THE SAID ORDER, THEP 9 ITA NO.1641/MDS/2013 ASSESSEE PREFERRED AN APPEAL TO THE INCOME-TAX APPE LLATE TRIBUNAL. 4. CONSIDERING THE MATERIALS PLACED BEFORE IT, THE TRIBUNAL FOUND THAT INASMUCH AS THE ASSESSEE WAS CONDUCTING COURSES AND SEMINARS AND WAS ALSO PUBLISHING AND SE LLING BOOKS OF PROFESSIONAL INTEREST, THOSE ACTIVITIES CO ULD ONLY BE CONSTRUED AS A PART OF ON-GOING EDUCATION OF CHARTE RED ACCOUNTS, WHICH, IN TURN, WOULD NECESSARILY HELP TH E SOCIETY TO GET BETTER, WELL-EQUIPPED AND SKILLED SET OF CHA RTERED ACCOUNTANTS FOR MAINTAINING AUDIT QUALITY. WITH T HAT FINDING, THE TRIBUNAL ALLOWED THE APPEAL AND HELD THAT THE A SSESSEE WAS ENTITLED TO APPROVAL UNDER SECTION 80G OF THE A CT. 5. ON A CHALLENGE TO THE SAID ORDER, MR.T.RAVIKUMAR , LEARNED STANDING COUNSEL FOR THE REVENUE, WOULD SUB MIT THAT IN TERMS OF FIRST PROVISO TO SECTION 2(15) OF THE INCOME- TAX ACT, IN THE EVENT THE ACTIVITIES OF THE TRUST I NVOLVE THE CARRYING ON OF ANY ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS OR ANY ACTIVITY OF RENDERING ANY SERVIC E IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS, IT SHA LL NOT BE CONSTRUED TO BE A CHARITABLE PURPOSE. HENCE, THE A SSESSEE IN QUESTION SHALL NOT FALL WITHIN THE DEFINITION OF SECTION 2(15) OF THE ACT. 6. WE HAVE CONSIDERED THE ABOVE SUBMISSION. THE PROVISIONS OF SECTION 2(15) OF THE INCOME-TAX ACT, READ AS UNDER: 2(15) 'CHARITABLE PURPOSE' INCLUDES RELIEF OF THE P OOR, EDUCATION, MEDICAL RELIEF, (PRESERVATION OF ENVIRONMENT (INCLUDING WATERSHEDS, FORESTS AND WILDLIFE) AND PRESERVATION OF MONUMENTS OR PLACES O R OBJECTS OF ARTISTIC OR HISTORIC INTEREST,) AND THE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY: PROVIDED THAT THE ADVANCEMENT OF ANY OTHER OBJECT O F GENERAL PUBLIC UTILITY SHALL NOT BE A CHARITABLE PURPOSE, IF IT INVOLVES THE CARRYING ON OF ANY ACTI VITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS, OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATION TO AN Y TRADE, COMMERCE OR BUSINESS, FOR A CESS OR FEE OR A NY OTHER CONSIDERATION, IRRESPECTIVE OF THE NATURE OF USE OR APPLICATION, OR RETENTION, OF THE INCOME FROM SU CH ACTIVITY: 10 ITA NO.1641/MDS/2013 PROVIDED FURTHER THAT THE FIRST PROVISO SHALL NOT A PPLY IF THE AGGREGATE VALUE OF THE RECEIPTS FROM THE ACTIVI TIES REFERRED TO THEREIN IS (TEN LAKH RUPEES) OR LESS IN THE PREVIOUS YEAR; 7. IN TERMS OF SUB-SECTION 15 OF SECTION 2 OF THE A CT, A CHARITABLE PURPOSE INCLUDES THE RELIEF OF THE POOR, EDUCATION, MEDICAL RELIEF, PRESERVATION OF ENVIRONMENT INCLUDI NG WATERSHEDS, FORESTS AND WILDLIFE AND PRESERVATION O F MONUMENTS OR PLACES OR OBJECTS OF ARTISTIC OR HISTO RIC INTEREST, AND THE ADVANCEMENT OF ANY OTHER OBJECT O F GENERAL PUBLIC UTILITY. IF THE ACTIVITIES ARE IN T HE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC U TILITY, SUCH ACTIVITIES CAN BE CALLED AS 'CHARITABLE PURPO SE'. HOWEVER, IN TERMS OF THE FIRST PROVISO TO SUB SECTI ON 15 OF SECTION 2 OF THE ACT, IF THE TRUST INVOLVES THE CAR RYING ON OF ANY ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BU SINESS, OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATION T O ANY TRADE, COMMERCE OR BUSINESS, SUCH ACTIVITIES SHALL NOT BE A CHARITABLE PURPOSE. THE QUESTION, THEREFORE, IS WH ETHER THE PUBLICATION OF BOOKS OF PROFESSIONAL INTEREST TO BE USED AS A REFERENCE MATERIAL BY THE GENERAL PUBLIC INCLUDING THE PROFESSIONALS IN RESPECT OF BANK AUDIT, TAX AUDIT, ETC. WOULD BE CONSTRUED TO BE A CHARITABLE PURPOSE. 8. THE OBJECTS OF THE ASSESSEE-TRUST, AS REFERRED T O ABOVE, ARE AMONG OTHER THINGS TO CONDUCT PERIODICAL MEETIN GS ON PROFESSIONAL SUBJECTS AND TO ACHIEVE THE SAID OBJEC TS, THE ASSESSEE IS PUBLISHING BOOKS, BOOKLETS, ETC. ON PROFESSIONAL SUBJECTS, AND SELLING THE SAME ONLY O N THE SUBJECTS RELATED TO AUDIT AND NOT ON ANY OTHER SUBJ ECT. CONSEQUENTLY, THOSE BOOKS ARE PRIMARILY SOLD ONLY T O THE MEMBERS OF THE SOCIETY. OF COURSE, THE BOOKS ARE A LSO MADE AVAILABLE FOR SALE TO THE GENERAL PUBLIC AIMIN G TO HELP THE SOCIETY TO GET BETTER, WELL-EQUIPPED AND SKILLE D SET OF CHARTERED ACCOUNTANTS FOR MAINTAINING AUDIT QUALITY . 9. IN OUR OPINION, SUCH ACTIVITIES OF THE ASSESSEE- TRUST CANNOT BE CONSTRUED TO BE ONE OF TRADE OR COMMERCE OR BUSINESS AND IT WOULD ONLY BE A CHARITABLE IN NATUR E. THEREFORE, IT CANNOT BE HELD THAT THE ACTIVITIES OF THE ASSESSEE-TRUST IN PUBLISHING AND SELLING BOOKS OF PROFESSIONAL INTEREST, WHICH ARE MEANT TO BE USED A S A REFERENCE MATERIAL EVEN BY THE GENERAL PUBLIC AS WE LL AS THE PROFESSIONALS IN RESPECT OF BANK AUDIT, TAX AUDIT, ETC., CANNOT BE CONSTRUED TO BE ONE OF COMMERCE IN NATURE . THE FINDING OF THE TRIBUNAL IN THIS REGARD REQUIRES NO INTERFERENCE. 11 ITA NO.1641/MDS/2013 10. THAT APART, UNDER SECTION 12AA OF THE INCOME-TA X ACT, WHILE CONSIDERING THE APPLICATION, THE OFFICER HAS TO SATISFY ABOUT THE GENUINENESS OF ACTIVITIES OF THE TRUST OR THE INSTITUTION AND FOR THAT REASON, HE MAY ALSO MAKE S UCH ENQUIRIES AS HE DEEM IT NECESSARY IN THAT BEHALF. IN THE GIVEN CASE, THERE IS NOTHING TO DOUBT ABOUT THE GEN UINENESS OF THE ACTIVITIES OF THE ASSESSEE-TRUST IN QUESTION . 8. THE FACTS IN THE PRESENT CASE ARE ALMOST SIMILAR TO THAT OF THE FACTS IN THE CHARTERED ACCOUNTANTS STUDY CIR CLE WHICH WAS FORMED FOR THE BENEFIT OF PROFESSIONALS AS WELL AS STUDENTS OF CHARTERED ACCOUNTANTS. IN THIS CASE, AS SUBMITTED BY THE AUTHORIZED REPRESENTATIVE, THE MEMORANDUM OF THE SOCIETY HAS BEEN AMENDED WITH RETROSPECTIVE EFFECT AND THIS WAS NOT PLACED BEFORE THE DIRECTOR OF INCOME TAX (EXEMPTIONS). ACCORDING TO THE AMENDED MEMORANDUM BENEFITS ARE NOT RESTRICTED ONLY TO THE MEMBERS OF THE SOCIETY OR ORTHOPAEDIC SURGEONS AND SINCE THE DIRECTOR OF INCOME TAX (EXEMPTIONS) HAS NOT EXAMINED THE AMENDED MEMORANDUM AND THE CASE LAWS RELIED ON BY THE COUNS EL, WE DEEM IT APPROPRIATE TO REMIT THE MATTER TO THE FILE OF THE DIRECTOR OF INCOME TAX (EXEMPTIONS) FOR FRESH CONSI DERATION IN THE LIGHT OF THE SUBMISSIONS AND THE ABOVE SAID DECISIONS OF THE HIGH COURT AND THE TRIBUNAL . ACCORDINGLY, W E SET ASIDE 12 ITA NO.1641/MDS/2013 THE IMPUGNED ORDER AND REMIT THE MATTER BACK TO THE FILE OF THE DIRECTOR OF INCOME TAX (EXEMPTIONS) FOR DE NOVO CONSIDERATION. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH JULY, 2015. SD/- SD/- ( ) ( # % ) ( CHANDRA POOJARI ) ( CHALLA NAGENDRA PRASAD ) ' / ACCOUNTANT MEMBER %( ' / JUDICIAL MEMBER % /CHENNAI, * /DATED 17 TH JULY, 2015 SOMU (,- .- /COPY TO: 1. APPELLANT 2. RESPONDENT 3. / () /CIT(A) 4. / /CIT 5. - ((3 /DR 6. 6 /GF .