ITO (Exemptions) Ward 2, CHENNAI V. All India Chess Federation, CHENNAI

ITA 1784/CHNY/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 4773 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-02-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2011-2012
• Appeal Filed On: 19-07-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S NATARAJA
• Assessee Lawyers: A SATYASEELAN
• Section: 12

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: CHENNAI , , % BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NOS.1783, 1784 & 1785/CHNY/2017 /ASSESSMENT YEARS: 2012-13, 2011-12 & 2010-11 THE INCOME TAX OFFICER- (EXEMPTIONS), WARD-2, CHENNAI-600 034. VS. M/S.ALL INDIA CHESS- FEDERATION, HALL NO.70, JAWAHARLAL NEHRU STADIUM, SYDENHAMS ROAD, PERIAMET, CHENNAI-600 003. [PAN: AAAAA 2155 P] ( ' /APPELLANT) ( ()' /RESPONDENT) DEPARTMENT BY : MR. S.NATARAJA, JCIT ASSESSEE BY : MR.A.SATYASEELAN, ADV. + /DATE OF HEARING : 13.02.2018 + / DATE OF PRONOUNCEMENT : 13.02.2018 / O R D E R PER GEORGE MATHAN , JUDICIAL MEMBER : ITA NOS.1783 TO 1785/CHNY/2017 ARE THE APPEALS FIL ED BY THE REVENUE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-17, CHENNAI, IN ITA NOS.287/12-13, 6/14-15 & 33/15-16/C IT(A)-17 DATED 31.03.2017 FOR THE AYS 2010-11, 2011-12 & 2012-13 R ESPECTIVELY. 2. SHRI S.NATARAJ, JCIT REPRESENTED ON BEHALF OF TH E REVENUE AND SHRI A. SATYASEELAN, ADV., REPRESENTED ON BEHALF OF THE ASSESSEE. ITA NOS.1783 TO 1785/CHNY/2017 :- 2 -: 3. IT WAS A SUBMISSION THAT IN THE COURSE OF THE AS SESSMENT, THE AO HAD INVOKED THE PROVISO TO SEC.2(15) OF THE ACT AND HAD HELD THAT THE PROVISIONS OF SEC.11 & 12 ARE INOPERATIVE AND HAD B ROUGHT TO TAX THE ENTIRE EARNINGS AS THE INCOME OF THE SOCIETY. IT W AS A SUBMISSION THAT ON APPEAL, THE LD.CIT(A) HAD FOLLOWED THE DECISION OF THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE ASSESSEES OWN CASE FOR THE AY 2009-10 HAD ALLOWED THE ASSESSEES APPEAL. IT WAS A SUBMISSION THAT TH E ORDER OF THE LD.CIT(A) WAS LIABLE TO BE REVERSED. 4. IN REPLY, THE LD.AR VEHEMENTLY SUPPORTED THE ORD ER OF THE LD.CIT(A). IT WAS A SUBMISSION THAT THE ISSUES WER E SQUARELY COVERED BY THE DECISION OF CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE ASSESSEES OWN CASE IN ITA NO.184/MDS/2013 DATED 09.05.2014 FOR TH E AY 2009-10. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. 6. THE ISSUE PRIMARILY RELATES TO THE APPLICABILITY OF THE PROVISO TO SEC.2(15) OF THE ACT. A PERUSAL OF THE DECISION OF THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE ASSESSEES OWN CASE FOR THE AY 2009-10, REFERRED TO SUPRA, SHOWS THAT THE HONBLE CO-ORDINATE BENCH OF THIS TRIBUNAL HAS HELD AS FOLLOWS: 9. THUS, IT CAN BE CONCLUDED THAT THE SPORTS PROMOT ION IS HUMAN RESOURCES DEVELOPMENT AND CONSIDERING THE POLICY DECLARATION OF GOVERNMEN T OF INDIA, SPORTS IS CONSTRUED AT PAR WITH EDUCATION. THE GOVERNMENT OF INDIA DOES CONS IDER PROMOTING AND REGULATION OF SPORTS AS CONSTITUTIONAL OBLIGATION AND DISCHARGES THE SAME THROUGH RECOGNIZED SPORTS FEDERATIONS IN INDIA LIKE THAT OF THE ASSESSEE. THE GOVERNMENT ALSO FORMULATES SPORTS MANAGEMENT AND PROVIDES TRAINING AND TECHNICAL ASSI STANCE FOR DEVELOPMENT OF SPORTS IN INDIA. THE NATIONAL SPORTS FEDERATIONS LIKE THAT OF THE ASSESSEE HONORING THE NATIONAL DEVELOPMENT BOARD IS THE EXTENDED ARM OF GOVERNMENT PROVIDING TRAINING, COACHING, ITA NOS.1783 TO 1785/CHNY/2017 :- 3 -: DEVELOPMENT OF SKILL AMONG THE SPORTSPERSONS IN IND IA. IN FURTHERANCE TO THE ABOVE DISCUSSIONS ONE CAN APPRECIATE THAT IN THE PRESENT SCENARIO, SPORTS HAS ALSO EMERGED AS A PROFESSION THE INCOME DERIVED FROM WHICH IS TAXABLE , AND SUCH PROFESSION IS ASSOCIATED WITH SYSTEMATIC AND CONTINUES EDUCATION IN THE SPORT ONE PROFESS COUPLED WITH TRAINED PHYSICAL AND MENTAL FITNESS AND THEREFORE PROVIDING KNOWLEDG E IN ANY SPORT HAVE TO BE TREATED AT PAR WITH EDUCATION. 10. CONSIDERING THE RATIO OF THE AFORESAID DECISION S AND DISCUSSIONS, AND ALSO THE SCOPE OF SPORTS DEVELOPMENT IN INDIA, WE ARE OF THE VIEW THA T THE RECOGNIZED SPORTS ASSOCIATION IN INDIA, WHO IMPART KNOWLEDGE IN SPORTS, PROMOTION OF SPORTS BY CONDUCTING VARIOUS SPORTS ACTIVITIES IN ALL BRANCHES, TO FALL WITHIN THE SCOP E OF EDUCATION AS DEFINED UNDER THE AMENDED PROVISIONS OF SECTION-2(15) OF THE ACT. ACC ORDINGLY WE HOLD THAT THE OBJECTS OF THE ASSESSEE SOCIETY WILL FALL WITHIN THE SCOPE OF THE FIRST LIMB OF THE AMENDED PROVISIONS OF SECTION 2(15) OF THE ACT VIZ., EDUCATION. FURTHER ON ANALYZING THE ACTIVITIES OF THE ASSESSEE SOCIETY WITH REGARD TO FIDE TRAINER COACH FEE RS.5,70,000/-, AICF CHRONICLE RS.2,53,300, PRIZE MONEY SHARE RS.5,51,500/-, REN T ON MONRAI SYSTEM RS.1,43,750/, TITLE FEES RS.3,00,500/-,TELECAST CHARGESDOORDAR SHAN RS.12,00,000, AND FIDE REMITTANCES RS.15,35,052/-, WE FIND THAT ALL OF T HEM RELATE TO THE ACTIVITIES WHICH ARE INCIDENTAL TO THE MAIN OBJECTS OF THE ASSESSEES SO CIETY AND THEREFORE, PROVISO TO SECTION 2(15) OF THE ACT WILL NOT BE ATTRACTED. BASED ON OUR AFORESAID DECISION THE LEARNED ASSESSING OFFICER IS HEREBY DIRECTED TO MODIFY HIS ORDER ACCORDINGLY. 11. IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWE D. 7. AS IT IS NOTICED THAT THE ISSUES ARE SQUARELY CO VERED BY THE DECISION OF THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE AS SESSEES OWN CASE FOR THE AY 2009-10 AND AS IT IS NOTICED THAT THE LD.CIT (A) HAS FOLLOWED THE JUDICIAL DISCIPLINE IN FOLLOWING THE DECISION OF TH E CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE ASSESSEES OWN CASE FOR THE AY 2009 -10, WE FIND NO ERROR TO INTERFERE WITH THE ORDER OF THE LD.CIT(A) ON THI S ISSUE. AS THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE, NONE OF THE OTHER GROUNDS SURVIVE. 8. IN THE RESULT, THE APPEALS FILED BY THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON FEBRUARY 13, 2018, AT CHENNAI. SD/- SD/- ( ) ( S. JAYARAMAN ) /ACCOUNTANT MEMBER ( ) (GEORGE MATHAN) /JUDICIAL MEMBER ITA NOS.1783 TO 1785/CHNY/2017 :- 4 -: /CHENNAI, 0 /DATED: FEBRUARY 13, 2018. TLN + (12 32 /COPY TO: 1. ' /APPELLANT 4. 4 /CIT 2. ()' /RESPONDENT 5. 2 ( /DR 3. 4 ( ) /CIT(A) 6. /GF