DDIT, CHENNAI V. Dolphin Club, CHENNAI

ITA 1929/CHNY/2014

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 81261 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-11-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 11-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GURU BHASHYAMJCIT
• Keywords: Charitable institution; Cancellation of registration
• Section: 143(3); 12AA; 12; 11

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI . , , !' # , $ % BEFORE SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ./ I.T.A.NO.1929/MDS./2014 ( / ASSESSMENT YEAR :2009-10) DEPUTY DIRECTOR OF INCOME- TAX(EXEMPTIONS)-III, AYAKAR BHAVAN, ANNEXE BUILDING III FLOOR, NUNGAMBAKKAM, CHENNAI. VS. M/S.DOLPHIN CLUB , 3/15,JESWANTH NAGAR, MOGAPPAIR WEST, CHENNAI-600 058 PAN AAATD 0288 P ( &' / APPELLANT ) ( #(&' / RESPONDENT ) / APPELLANT BY : MR.GURU BHASHYAM,JCIT D.R. / RESPONDENT BY : MR.PHILIP GEORGE,ADVOCATE / DATE OF HEARING : 22.09.2014 ! /DATE OF PRONOUNCEMENT : 13.11.2014 ) / O R D E R PER A.MOHAN ALANKAMONY , ACCOUNTANT MEMBER: THIS APPEAL IS FILED BY THE REVENUE, AGGRIEVED BY THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(A)-VII, CHEN NAI DATED ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 2 18.03.2014 IN ITA NO.580/11-12 PASSED U/S 143(3) R EAD WITH SECTION 250 OF THE ACT. 2. THE REVENUE AGGRIEVED BY THE ORDER OF THE LD. LD . CIT (A) HAS TAKEN UP FIVE GROUNDS BEFORE US; HOWEVER, THE CRUX OF THE ISSUE IS THAT THE LD. LD. CIT (A) HAD ERRED IN HOLDING THAT THE A SSESSEE IS ELIGIBLE FOR EXEMPTION U/S.11 OF THE ACT WITHOUT APPRECIATIN G THE FACT THAT IT IS IN VIOLATION TO THE NEWLY INSERTED PROVISO TO SEC.2 (15) OF THE ACT SINCE THE OBJECTS OF THE ASSESSEE SOCIETY FALLS UNDER GENERAL PUBLIC UTILITY AS ENVISAGED IN THE ACT. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE IS A SOCIETY REGISTERED UNDER TAMIL NADU SOCIETIES REGISTRATION ACT, 1975, FORMED TO PROMOTE SPORTS SUCH AS SWIMMING ETC. THE LD. ADIT(E) OPINED THAT THE OBJECTS OF THE SOCIETY FALLS UNDER THE FOURTH LIMB OF SEC 2(15) OF THE ACT VIZ. ANY OTHER OBJECTS OF GENERAL PUBLIC UTILITY . THE LD. ADIT(E) FURTHER OBSERVED ON EXAMINING THE I NCOME AND EXPENDITURE ACCOUNT OF THE ASSESSEE THAT, THE ASS ESSEE HAD RECEIPTS EXCEEDING ` 10 LAKHS IN THE NATURE OF COACHING FEES AND ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 3 SWIMMING ACADEMY FEES AGGREGATING TO ` 43,33,007/- AND FURTHER THE ACTIVITIES OF THE SOCIETY WERE COMMERCIAL IN NATURE . THE LD. A.R. CONTENDED BEFORE THE LD.ADIT(E) THAT THE ASSESSEE T RUST DOES NOT CARRY OUT ANY ACTIVITY IN THE NATURE OF TRADE, COMM ERCE, BUSINESS ETC., BUT ONLY CONDUCTS SPORTING EVENTS AND RELATED ACTIV ITIES. DISREGARDING THE SUBMISSIONS OF THE LD. A.R, THE LD.ADIT(E) RECO MMENDED FOR CANCELLATION OF REGISTRATION U/S. 12AA OF THE ACT I N THE CASE OF THE ASSESSEE. FURTHER TREATING THE ASSESSEE AS AN AOP , THE LD.A.O BROUGHT TO TAX ITS EXCESS OF INCOME OVER THE EXPEND ITURE. WHEN THE MATTER CROPPED UP BEFORE THE LD. CIT (A), THE LD. C IT (A) HELD THE ISSUE IN FAVOUR OF THE ASSESSEE BY HOLDING AS FOLLO WS:- 4. I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE APPELLANT VIS-- VIS THE ASSESSMENT ORDER PASSED. PERUSAL OF THE OBJ ECTS OF THE SOCIETY REVEALS THAT THE SOCIETY EXISTS FOR THE PROMOTION O F SWIMMING SPORTS. THE A.O DID NOT FIND ANY VIOLATION OF OBJECTS OF TH E SOCIETY. REGISTRATION GRANTED U/S.12A(A) OF THE ACT WAS NOT CANCELLED BY THE DIT(E),CHENNAI. ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY SHALL NOT BE A CHARITABLE PURPOSE IF IT IN VOLVES THE CARRYING ON OF ANY ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BU SINESS OR ANY ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 4 ACTIVITY OF RENDERING ANY SERVICE IN RELATION TO AN Y TRADE, COMMERCE OR BUSINESS FOR A CESS, OR FEE OR ANY OTHER CONSIDERAT ION, IRRESPECTIVE OF THE NATURE OF USE OR APPLICATION OR RETENTION OF TH E INCOME FROM SUCH ACTIVITY. IN THIS CASE NO SUCH VIOLATION IS NOTICE D AND THERE IS NO PROFIT MOTIVE IN TRAINING THE PROSPECTIVE SWIMMERS. THE O NLY ACTIVITY CARRIED ON BY THE APPELLANT IS TRAINING OF PERSONS IN THE S PORT OF SWIMMING AND NO OTHER ACTIVITY HAS BEEN CARRIED OUT BY THE APPEL LANT. EARNING OF PROFIT DURING THE COURSE OF CARRYING ON THE ACTIVIT Y, AS IN THE CASE WITH THE APPELLANT DOES NOT VITIATE THE CHARITABLE NATUR E OF THE APPELLANT AS LONG AS THE PROFIT EARNED/ACCRUED IS UTILIZED TOWAR DS FULFILLMENT OF OBJECTS OF THE TRUST. IT IS GEMANE TO REFER TO PAG E 2 OF BOARDS CIRCULAR NO.395 DATED 24.09.1984 WHICH READS AS UNDER:- THE QUESTION WHETHER PROMOTION OF SPORTS AND GAMES CAN BE CONSIDERED AS BEING A CHARITABLE PURPOSE HAS BEE N EXAMINED. THE BOARD ARE ADVISED THAT THE ADVANCEMEN T OF ANY OBJECT BENEFICIAL TO THE PUBLIC OR A SECTION OF THE PUBLIC AS DISTINGUISHED FROM AN INDIVIDUAL OR GROUP OF IND IVIDUALS WOULD BE AN OBJECT OF GENERAL PUBLIC UTILITY. IN V IEW THEREOF, PROMOTION OF SPORTS AND GAMES IS CONSIDERED TO BE A CHARITABLE PURPOSE WITHIN THE MEANING OF SEC.2(15). THEREFORE, AN ASSOCIATION OR INSTITUTION ENGAGED IN THE ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 5 PROMOTION OF SPORTS AND GAMES CAN CLAIM EXEMPTION U /S. 11 OF THE ACT, EVEN IF IT IS NOT APPROVED U/S. 10(2 3) RELATING TO EXEMPTION FROM TAX OF SPORTS, ASSOCIATIONS AND INSTITUTIONS HAVING THEIR OBJECTS AS, PROMOTION, CO NTROL, REGULATION AND ENCOURAGEMENT OF SPECIFIED SPORTS AN D GAMES. 5. IN VIEW OF THE ABOVE CIRCULAR, SWIMMING IS A SP ORT ACTIVITY AND PROMOTION OF THE SAME IS DEFINITELY A CHARITABLE AC TIVITY AND HENCE THE SOCIETY IS ELIGIBLE FOR EXEMPTION U/S. 11 & 12 OF T HE ACT. MOREOVER SWIMMING IS A GOOD EXERCISE AND HEALTH PROMOTING AC TIVITY. HENCE, I DIRECT THE ASSESSING OFFICER TO ACCEPT THE INCOME RETURNED AT NIL AND ALL THE ADDITIONS MADE IN THE ASSESSMENT ORDER ARE HEREBY ORDERED TO BE DELETED. 4. BEFORE US, LD. A.R. REITERATED HIS SUBMISSION M ADE BEFORE THE REVENUE. HE FURTHER POINTED OUT THAT THE ISSUE IS C OVERED IN ITS FAVOUR BY THE DECISION OF THE CASE OF M/S.ALL INDIA CHESS FEDERATION IN ITA NO.184/MDS./2013 DATED 09.05.2014. HE FURTHER FILED TWO PAPER BOOKS CONTAINING 18 & 26 PAGES RESPECTIVELY WHICH C ONSIST OF THE FOLLOWING DOCUMENTS AND DECISION OF THE VARIOUS CAS ES:- ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 6 LIST OF DOCUMENTS DATE PAR TICULARS 09.01.1995 COPY OF CERTIFICATE OF REGISTRATION OF S OCIETIES FOR REGISTRATION OF THE APPELLANT UNDER TAMIL NADU SOCIETIES REGISTRATI ON, ACT, 1975 ALONG WITH BYE-LAWS AND MEMORANDUM OF ASSOCIATION O F THE APPELLANT. 22.04.2002 COPY OF AGREEMENT BETWEEN THE APPELLANT AND SPORTS DEVELOPMENT AUTHORITY OF TAMIL NADU. 28.08.2008 COPY OF LETTER FROM SPORTS DEVELOPMENT A UTHORITY OF TAMIL NADU TO THE EXECUTIVE ENGINEER/O&M/AMBATTUR/CEDC/WEST -- COPY OF LIST OF INTERNATIONAL, NATIONAL AND STAT E LEVEL SWIMMERS TRAINED BY THE APPELLANT. --- COPY OF STATEMENT SHOWING PERFORMANCE OF THE AP PELLANT IN VARIOUS SWIMMING COMPETITION HELD FROM 1989 TO 2010 04.01.2008 COPY OF MESSAGE FROM THE MEMBER SECRETAR Y, SPORTS DEVELOPMENT AUTHORITY OF TAMIL NADU. LIST OF DECISIONS 1. NECTAR BEVERAGES P. LTD VS. DCIT 314 ITR 314(SC) 2. LISSIE MEDICAL INSTITUTIONS VS.CIT KOCHI 348 ITR 3 44(KERALA) 3. DIT(EXEMPTION) VS. CHARANJIV CHAIRTABLE TRUST, 267 CTR 305(DELHI) 4. J.K.SYNTHETICS VS. UNION OF INDIA, 199 ITR 43(SC) 5. DDIT(EXEMPTION) VS. ADI SANKARA TRUST, 143 TTJ 234( COCHIN) 6. LD. CIT VS. RAO BAHADUR CALAVALA CUNNAN CHETTY CHA RITIES, 135 ITR 485(MAD.) 7. ENTERTAINMENT SOCIETY OF GOA VS. LD. CIT 23 ITR 63 5, ITAT PANAJI 8. KANAHYA LAL PUNJ CHAIRTABLE TRUST VS. DIT(EXEMPTION ), 297 ITR 66(DEL.) ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 7 5. ON THE OTHER HAND LD. D.R RELIED ON THE ORDERS OF THE LD.ADIT(E) AND ARGUED IN SUPPORT OF THE SAME. 6.1 WE HAVE HEARD THE RIVAL SUBMISSIONS AND CARE FULLY PERUSED THE MATERIALS AVAILABLE ON RECORD. THE OBJECTS OF THE ASSESSEE SOCIETY ARE EXTRACTED HEREIN BELOW FOR REFERENCE:- OBJECTIVES OF THE SOCIETY 1. TO ENCOURAGE AND DEVELOP EXISTING AND POTENTIAL SWIMMERS ASSOCIATED WITH THE DOLPHIN CLUB IN ALL AGE GROUPS. 2. SPECIFICALLY TO PROVIDE ADVANCED COACHING AND T O PREPARE THE DOLPHIN CLUB SWIMMERS FOR VARIOUS COMPETITIONS AT THE LOCAL , DISTRICT, STATE, ZONAL, NATIONAL AND INTERNATIONAL LEVELS. 3. TO ARRANGE AND PROVIDE FOR GYM AND DRY LAND EX ERCISE FACILITIES AND SESSIONS TO IMPROVE THE PERFORMANCE OF DOLPHIN CLUB SWIMMERS. 4. TO ARRANGE AND WORK TOWARDS PROVIDING EQUIPMENT , GEAR AND FACILITIES SUCH AS EVEN A SWIMMING POOL TO ENABLE PROPER AND S MOOTH CONDUCT OF THE SWIMMING COACHING PROGRAMME. 5. TO PROTECT AND REPRESENT THE INTERESTS OF DOLPH IN CLUB SWIMMERS AT THE TIME OF VARIOUS COMPETITIONS SUCH AS MENTIONED IN ITEM 2. ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 8 6. TO PROTECT AND REPRESENT THE INTERESTS OF DOLP HIN CLUB SWIMMERS WITH THE LOCAL, DISTRICT, STATE, ZONAL AND NATIONAL ASSOCIATIONS AND WITH THE SPORTS COUNCILS, GOVT. DEPARTMENTS, RE GULATORY AGENCIES ETC. 7. TO ARRANGE AND CONDUCT SWIMMING COMPETITIONS SO AS TO EXPOSE THE DOLPHIN CLUB SWIMMERS FOR MORE AND REGULAR EXPERIEN CE IN COMPETITIVE SWIMMING. 8. TO PROVIDE FITNESS PROGRAMME FOR ADULT MEMBERS OF THE DOLPHIN CLUB. 9. TO PROVIDE TRAINING AND SWIMMING WORK-OUTS FOR DISABLED OR HANDICAPPED PERSONS SO AS TO ENABLE THEM TO OVERCOM E OR REDUCE THEIR HANDICAPS AND IMPROVE THEIR SKILLS OR ABILITIES. 10. TO ASSIST THE HON. COACHES OF THE DOLPHIN CLUB IN THEIR EFFORTS TO INCREASE THEIR KNOWLEDGE AND EXPERIENCE IN AREAS DIRECTLY AS WELL AS INDIRECTLY RELATED TO SWIMMING AND COACHING. 11. WHENEVER NECESSARY TO PROVIDE THE HON. COACHES OF DOLPHIN CLUB ALL ASSISTANCE AS WELL AS FUNDS TO ENABLE THEM TO ACCOMPANY THE DOLPHIN CLUB SWIMMERS FOR COMPETITIONS OR TRAINING CAMPS. 12. TO BECOME A MEMBER OR AFFILIATE WITH ANY ORGANI ZATION, SOCIETY ASSOCIATION OR CLUB HAS COMMON INTERESTS WITH THE D OLPHIN CLUB, ESPECIALLY IN THE FIELD OF SWIMMING. ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 9 13. TO COLLECT MEMBERSHIP FEES DONATIONS, GRANTS A ND LOANS TO MEET THE ABOVE MENTIONED OBJECTIVES ON A NON-PROFIT BASIS. 14. TO INVEST THE FUNDS OF THE CLUB ON TEMPORARY, SHORT TERM OR LONG TERM BASIS SO AS TO EARN SOME ADDITIONAL FUNDS FOR MEETI NG THE OBJECTIVES OF THE DOLPHIN CLUB. 15. TO DO ALL SUCH ACTS, DEEDS AND THINGS AS MAY B E INCIDENTAL OR NECESSARY OR CONDUCTIVE TO THE FURTHERANCE OF THE A BOVE OBJECTS. 16. ALL THE ABOVE ACTIVITIES WILL BE CARRIED OUT WI THOUT ANY DISTINCTION OF CASTS, CREED, OR RELIGION. 6.2. FURTHER FROM THE PAPER BOOK PAGE 10, WE FIND THAT THERE IS AN AGREEMENT EXISTING BETWEEN THE ASSESSEE-SOCIETY AND THE SPORTS DEVELOPMENT AUTHORITY OF TAMIL NADU (SDAT), A SOCIE TY REGISTERED UNDER TAMIL NADU SOCIETIES REGISTRATION ACT, 1975, WHICH IS AN EXTENDED ARM OF THE TAMIL NADU STATE GOVERNMENT TO PROMOTE SPORTS IN THE STATE OF TAMIL NADU WHEREIN THE SDAT HAS REC OGNIZED THE ACTIVITIES OF THE ASSESSEE AND PARTNERED WITH IT FO R DEVELOPING THE SPORT OF SWIMMING. THIS FACT IS FURTHER EVIDENT FRO M THE LETTER BY THE SDAT TO THE EXECUTIVE ENGINEER CEDC/WEST DIRECTING THE ELECTRICITY BOARD TO LEVY ELECTRICITY CHARGES UNDER II-B CATEGO RY SINCE THE ASSESSEE SOCIETY WAS FUNCTIONING FOR EDUCATION OF S WIMMING FOR ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 10 SCHOOL STUDENTS AND IMPARTING TRAINING TO THE STUDE NTS TO DEVELOP THEIR TALENTS ON PAR WITH NATIONAL AND INTERNATIONAL LEVE LS (PB PAGE 14). FURTHER IT IS PERTINENT TO MENTION HERE THAT THE S PORTS AUTHORITY OF INDIA WHICH IS ESTABLISHED BY THE GOVERNMENT OF IND IA IN THE YEAR 1994 AS A SOCIETY UNDER THE SOCIETIES REGISTRATION ACT, 1860 WITH THE TWIN OBJECTIVES OF DEVELOPMENT OF SPORTS IN INDIA A ND TO ACHIEVE EXCELLENCE IN NATIONAL AND INTERNATIONAL LEVEL. THU S IT IS AN EXTENDED ARM OF THE GOVERNMENT OF INDIA FUNCTIONING UNDER TH E SUPERVISION OF MINISTRY OF YOUTH AFFAIRS AND SPORTS AND REACH OUT TO THE PUBLIC AT LARGE THROUGH SIMILAR SOCIETIES FUNCTIONING UNDER T HE SUPERVISION AND CONTROL OF DIFFERENT STATE GOVERNMENTS IN INDIA LIK E THAT OF SPORTS DEVELOPMENT AUTHORITY OF TAMIL NADU (SDAT) IN THE S TATE OF TAMIL NADU. 6.3. FROM THE ABOVE FACTS AND FROM FINDINGS OF THE LD. CIT (A), IT IS APPARENT THAT THE ASSESSEE SOCIETY IS A SOCIETY, FO RMED FOR PROMOTING THE SPORTS OF SWIMMING AND RELATED ACTIVITIES AND T HEREBY, SQUARELY COVERED BY THE DECISION OF THE TRIBUNAL IN THE CASE OF M/S.ALL INDIA CHESS FEDERATION VS. CIT (A)-XII CITED SUPRA. ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 11 6. WE HAVE HEARD BOTH THE PARTIES AND CAREFU LLY PERUSED THE MATERIALS AVAILABLE ON RECORD. THE FOLLOWING FACTS ARE NOT D ISPUTED BY THE REVENUE AUTHORITIES AND IT IS CRUCIAL TO BE TAKEN NOTE OFF WHILE DECIDING THE ISSUE AND THEREFORE THEY ARE LISTED HEREIN BELOW:- I) THE ASSESSEE TRUST ALL INDIA CHESS FEDERATI ON SHORTLY CALLED AS AICF, IS A SOCIETY REGISTERED UNDER THE TAMILNADU SOCIETY REGISTRATION ACT, XXI OF 1860 ON 12 TH DAY OF DECEMBER, 1958. II) ALL THE OBJECTS OF THE TRUST, CENTERS AROUND PROMOTION, DEVELOPMENT, AND TO MAINTAIN CONTROL SELECTION OF TEAMS IN THE G AME OF CHESS IN INDIA. III) THE TRUST HAS BEEN EARLIER NOTIFIED BY THE CE NTRAL GOVERNMENT IN EXERCISE OF THE POWERS CONFERRED BY SEC.10(23) OF T HE INCOME TAX ACT VIDE NOTIFICATION NO.223/2002 WHICH WAS INTIMATED V IDE LETTER DATED 30.08.2002 (PAGE NO. 30 OF THE PAPER BOOK). IV) SINCE SEC.10(23) OF THE ACT WAS OMITTED BY TH E FINANCE ACT, 2002 WITH EFFECT FROM 01.04.2003, THE LD. DIT(E) VIDE ORDER N O.2(1491)07-08, DATED 19.06.08 HAD REGISTERED THE TRUST U/S. 12AA O F THE ACT (PAGE NO.32 OF THE PAPER BOOK). V) THE GOVERNMENT OF INDIA, MINISTRY OF YOUTH AFFA IRS AND SPORTS HAD RECOGNIZED THE ASSESSEE SOCIETY AND HAD GIVEN GRANT S ON VARIOUS DATES FOR CONDUCTING VARIOUS CHAMPIONSHIP AND OTHER PROGR AMS (PAGE NOS.269 TO 349 OF THE PAPER BOOK). VI) MINISTRY OF YOUTH AFFAIRS AND SPORTS HAS BEEN CONSISTENTLY RECOGNIZING THE ASSESSEE TRUST AS A NATIONAL SPORTS FEDERATION FOR A GAME OF CHESS (PAGE NOS.352 TO 356 OF THE PAPER BOOK) ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 12 6.1. FURTHER IT IS PERTINENT TO KNOW THAT SPORTS AUTHORITY OF INDIA WAS ESTABLISHED BY THE GOVERNMENT OF INDIA IN THE YEAR 1994 AS A SOCIETY UNDER THE SOCIETIES REGISTRATION ACT, 1860 WITH THE TWIN OBJE CTIVE OF DEVELOPMENT OF SPORTS IN INDIA AND ACHIEVE EXCELLENCE AT THE NATIONAL AND INTERNATIONAL LEVEL. THUS THE SOCIETY IS AN ARM OF GOVERNMENT OF INDIA FUNCTIONIN G UNDER THE SUPERVISION OF MINISTRY OF YOUTH AFFAIRS & SPORTS. THE AIM OF SPO RTS AUTHORITY OF INDIA IS:- TO IMPLEMENT SCHEMES/PROGRAMMES FOR ACHIEVING EXCEL LENCE IN SPORTS IN DIFFERENT DISCIPLINES AT INTERNATIONAL LE VEL IN ORDER TO ESTABLISH INDIA AS A MAJOR SPORTING POWER. TO MAINTAIN AND UTILIZE ON BEHALF OF THE GOVT., STA DIA WHICH WERE CONSTRUCTED/RENOVATED FOR THE IX ASIAN GAMES HELD I N 1982. TO ACT AS AN INTERFACE BETWEEN THE MINISTRY OF YOUT H AFFAIRS & SPORTS AND OTHER AGENCIES CONCERNED WITH THE PROMOTION/DEVELOPMENT OF SPORTS IN THE COUNTRY ON T HE OTHER HAND, I.E., STATE GOVT., U.T., ADMINISTRATION, IOA, NATIONAL SPORTS FEDERATIONS (SPORTS SOCIETIES LIKE THE ASSESSEE SOC IETY) , SPORTS CONTROL BOARDS, ETC. TO ESTABLISH, RUN, MANGE AND ADMINISTER THE INSTITU TIONS TO PRODUCE HIGH CALIBER COACHES, SPORTS SCIENTISTS AND PHYSICAL EDUCATION TEACHERS. TO PLAN, CONSTRUCT, ACQUIRE, DEVELOP, TAKE OVER, MA NAGE, MAINTAIN AND UTILIZE SPORTS INFRASTRUCTURE AND FACILITIES IN THE COUNTRY. TO INITIATE, UNDERTAKE, SPONSOR, STIMULATE AND ENCO URAGE RESEARCH PROJECTS RELATED TO VARIOUS SPORTS SCIENCE FOR UPGR ADATION OF SPORTS, SPORTSPERSONS AND COACHES. OTHER INCIDENTAL ISSUES CONCERNING PROMOTION, DEVEL OPMENT AND EXCELLENCE IN SPORTS. ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 13 FOR ACHIEVING ALL THE ABOVE OBJECTS RECOGNIZED NATI ONAL SPORTS FEDERATIONS OF THE COUNTRY LIKEWISE THE ASSE SSEE SOCIETIES ACT AS A FEEDER. 6.2. MINISTRY OF YOUTH AFFAIRS & SPORTS WAS INITIA LLY SET UP AS DEPARTMENT OF SPORTS IN 1982 AT THE TIME OF ORGANIZ ATION OF IX ASIAN GAMES IN NEW DELHI. IT BECAME SEPARATE MINISTRY ON 27 TH MAY, 2000. THE VISION OF THE MINISTRY WAS TO PROVIDE OPPORTUNI TIES FOR DEVELOPING THE PERSONALITY OF THE YOUTH SO THAT THEY MAY ACHIEVE T HE FULL POTENTIAL AND INVOLVE THEM IN VARIOUS NATIONAL BUILDING ACTIVITIE S ON ONE SIDE AND DEVELOPMENT OF SPORTS AND TO ACHIEVE EXCELLENCE AT NATIONAL AND INTERNATIONAL LEVEL IN ORDER TO FULFILL THESE OBJECTIVES, THE MINISTRY HAS PROMOTED VARIOUS NGOS, VOLUNTARY ORGANIZATIONS, NA TIONAL SPORTS FEDERATIONS, REGIONAL SPORTS ASSOCIATIONS ETC. THE MINISTRY HAS ALSO PROVIDED FINANCIAL ASSISTANCE TO VARIOUS RECOGNIZED ORGANIZATIONS INCLUDING NATIONAL SPORTS FEDERATIONS FOR SENDING THE TEAMS ABROAD FOR TRAINING AND PARTICIPATION IN INTERNATIONAL TOURNAM ENTS, FOR HOLDING INTERNATIONAL TOURNAMENTS IN INDIA FOR CONDUCTING N ATIONAL CHAMPIONSHIP AND FOR PROCURING SPORTS EQUIPMENTS. 6.3. FROM THE ABOVE IT IS EVIDENT THAT THE GOVERNM ENT OF INDIA HAS BEEN TAKING KEEN INTEREST TO DEVELOP SPORTS IN INDI A FOR PERSONALITY DEVELOPMENT OF THE YOUTH IN INDIA AND ACHIEVE EXCEL LENCE IN SPORTS IN NATIONAL AND INTERNATIONAL LEVEL. THERE ARE VARIOUS SPORTS RECOGNIZED BY THE OLYMPICS BODY, COMMON WEALTH SPORTS AUTHORITIES AND ASIAN GAMES SPORTS AUTHORITIES. THESE SPORTS ACTIVITIES CAN BE DEVELOPED ONLY BY PROVIDING SYSTEMATIC EDUCATION IN SPORTS IN THE RELEVANT FIELD COUPLED WITH PHYSICAL AND MENTAL TRAINING. THE GOVERNMENT OF INDIA IN ORDER TO PROMOTE SPORTS IN INDIA HAS RECOG NIZED VARIOUS ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 14 ORGANIZATIONS AS NATIONAL SPORTS FEDERATIONS AND HA S INFUSED FUNDS AND OTHER RESOURCES. CONSIDERING THE ABOVE FACTS IT CA N BE FIRMLY CONSTRUED THAT THESE ORGANIZATIONS WILL FALL WITHIN THE AMBIT OF PROMOTING EDUCATION IN THE FIELD OF SPORTS WHICH IS WITHIN THE SCOPE OF THE FIRST LIMP OF THE AMENDED PROVISIONS OF SEC.2 (15) OF THE ACT. 7. IT IS ALSO PERTINENT TO NOTE THE NATIONAL SPORTS DEVELOPMENT CODE OF INDIA, 2011 WHICH IS REPRODUCED HERE FOR REFERENCE:- 1. STATEMENT OF PURPOSE :- 1.1. SPORT DEVELOPMENT IS A NATIONAL PRIORITY, AS IT PROMOTES ACTIVE LIFESTYLE, CHILD AND YOUTH DEVELOPMENT, SOCIAL INCL USIVENESS, EMPLOYMENT OPPORTUNITIES, PEACE AND DEVELOPMENT, AN D ABOVE ALL A SENSE OF BELONGINGNESS AND NATIONAL PRIDE. WHILE AS STATE SUBJECT, SPORTS DEVELOPMENT COMES WITHIN THE PURVIEW OF THE STATES UP TO THE STATE LEVEL; AT THE NATIONAL AND INTERNATIONAL LEVE L (INCLUDING MEETING INTERNATIONAL TREATY OBLIGATIONS), IT FALLS WITHIN THE REALM AND REMIT OF THE UNION GOVERNMENT UNDER ITS RESIDUARY POWERS AND WIT HIN THE AMBIT OF ENTRIES 10 AND 13 OF THE UNION LIST IN THE SEVENTH SCHEDULE OF THE CONSTITUTION OF INDIA. 1.2. AT THE NATIONAL POLICY LEVEL, SPORT IS AT PAR WITH PUBLIC EDUCATION AND PUBLIC HEALTH, AND LIKE THEM SPORT IS A PUBLIC GOOD AND SPORT DEVELOPMENT IS A PUBLIC FUNCTION. IT IS FOR THIS R EASON THAT EVEN THOUGH NATIONAL SPORTS BODIES ARE AUTONOMOUS IN NATURE BOT H, THE SUPREME COURT OF INDIA AND SEVERAL HIGH COURTS HAVE, IN VAR IOUS JUDGMENTS, MAINTAINED THAT ALTHOUGH NATIONAL SPORTS BODIES ARE NOT STATE WITHIN ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 15 THE MEANING OF ARTICLE 12 OF THE CONSTITUTION OF IN DIA, THEY COME WITHIN THE WRIT JURISDICTION OF HIGH COURTS UNDER ARTICLE 226 O THE CONSTITUTION OF INDIA BECAUSE THEY PERFORM STATE-LIKE FUNCTIONS SUCH AS THE SELECTION OF NATIONAL TEAMS AND REPRESENTING THE CO UNTRY IN INTERNATIONAL SPORTS EVENTS AND FORUMS. 1.3. GLOBALLY, COUNTRIES ACROSS THE WORLD HAVE ENA CTED LAWS OR ENUNCIATED GUIDELINES FOR THE REGULATION OF SPORTS IN PUBLIC INTEREST AND IN NATIONAL INTEREST. THE NEED TO REGULATE SPORTS A RISES OUT OF SEVERAL CONSIDERATIONS SUCH AS THE NEED TO PREVENT RACISM IN SPORTS, ERADICATE DOPING IN SPORTS, PREVENT AGE FRAUD IN SPORTS, PROT ECT ATHLETES RIGHTS, PREVENT CHILD ABUSE AND SEXUAL HARASSMENT IN SPORTS , PROTECT GENDER EQUALITY IN SPORTS, PREVENT BETTING AND GAMBLING IN SPORTS, BAN DANGEROUS SPORTS, PROMOTE PROFESSIONAL MANAGEMENT A ND MANAGERIAL AND FINANCIAL ACCOUNTABILITY IN SPORTS, ADDRESS ANT I-TRUST AND COMPETITION POLICY ISSUES RELATED TO SPORTS, REGULA TE SPORTS BROADCASTING RIGHTS, REGULATE THE PRICE AND ENTRY T O SPORTS EVENTS, ETC. 1.4 GOVERNMENT OF INDIA ALSO HAS BEEN, FROM TIME T O TIME, TAKING VARIOUS STEPS AND INITIATIVES TO PROMOTE GOOD GOVER NANCE PRACTICES IN THE MANAGEMENT OF SPORTS AT THE NATIONAL LEVEL IN P URSUANCE OF SUCCESSIVE NATIONAL SPORTS POLICIES. THESE POLICIE S ARE BASED ON THE BASIC UNIVERSAL PRINCIPLES OF GOOD GOVERNANCE OF OL YMPIC AND SPORTS MOVEMENT AND DO NOT, IN ANY MANNER, CONTRADICT OR I NTERFERE WITH THE AUTONOMY OF THE NATIONAL SPORTS BODIES IN DISCHARGI NG THEIR FUNCTIONS AND DUTIES IN ACCORDANCE WITH THE INTERNATIONAL OLY MPIC COMMITTEE CHARTER. ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 16 1.5 ACCORDINGLY, AFTER THE NOTIFICATION OF THE 201 1 NATIONAL SPORTS POLICY THE GOVERNMENT NOTIFIED REVISED GUIDELINES F OR ASSISTANCE TO NATIONAL SPORTS FEDERATIONS (NSFS) IN AUGUST 2001 A ND ISSUED SUBSEQUENT GUIDELINES FROM TIME TO TIME, WHICH ARE LEGALLY BINDING ON THE NATIONAL OLYMPIC COMMITTEE (NOC), I.E., THE IND IAN OLYMPIC ASSOCIATION (IOA), AND THE NATIONAL SPORTS FEDERATI ONS (NSFS) IF THEY ARE DESIROUS OF REGULATING AND CONTROLLING SPORTS I N INDIA, OR USING THE NAME OF INDIA OR REPRESENTING INDIA WITHIN OR OUTSI DE INDIA, OR AVAILING THEMSELVES OF VARIOUS BENEFITS AND CONCESSIONS, INC LUDING FINANCIAL BENEFITS SUCH AS CUSTOMS DUTY EXEMPTION OR INCOME T AX EXEMPTION THAT ARE AVAILABLE TO NSFS, INCLUDING THE NOC. ALT HOUGH THESE BODIES MAY BE REGISTERED IN DIFFERENT STATES UNDER THE SOC IETIES REGISTRATION ACT OR THE COMPANIES ACT, THEIR AUTHORITY TO FUNCTI ON AS THE NOC OR NSF WILL BE DEPENDENT ON COMPLIANCE WITH THE GOVERN MENT GUIDELINES. 1.6. IN THE RECENT PAST GOVERNMENT HAS TAKEN VARIO US STEPS TO FURTHER IMPROVE THE MANAGEMENT OF NSFS AND SPORTS I N THE COUNTRY SUCH AS NOTIFICATION OF THE ANTI-DOPING CODE; INTRO DUCTION OF ANNUAL RECOGNITION OF NSFS TO ENSURE TRANSPARENCY AND ACCO UNTABILITY OF NSFS; ENFORCEMENT OF AGE AND TENURE LIMIT IN RESPEC T OF OFFICE BEARERS OF NSFS, INCLUDING THE INDIAN OLYMPIC ASSOCIATION; BRINGING NSFS UNDER THE PURVIEW OF RIGHT TO INFORMATION ACT; MEAS URES TO ENSURE FREE, FAIR AND TRANSPARENT ELECTIONS BY THE NSFS; A ND MEASURE TO COMBAT AGE FRAUD IN SPORTS; AND GUIDELINES FOR THE PREVENTION OF SEXUAL HARASSMENT OF WOMEN IN SPORTS. 1.7 THE VARIOUS ORDERS/CIRCULARS ISSUED BY THE GOVE RNMENT FROM TIME TO TIME ARE AMALGAMATED UNDER THIS NATIONAL SPORTS DEVELOPMENT CODE OF INDIA, 2011. ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 17 2. INTRODUCTION 2.1 SPORTS AND GAMES FORM AN ESSENTIAL PART OF HUM AN RESOURCE DEVELOPMENT. GOVERNMENT OF INDIA ATTACHES UTMOST IM PORTANCE TO SPORTS FOR DEVELOPMENT AND SPORTS FOR EXCELLENCE. IT HAS BEEN THE ENDEAVOUR OF THE GOVERNMENT TO LAY DOWN PROCEDURES FOR EFFECTIVE COORDINATION AMONG VARIOUS AGENCIES INVOLVED IN THE PROMOTION OF SPORTS AND EXTEND REQUIRED INFRASTRUCTURE, TRAINING AND OTHER FACILITIES TO THE SPORTSPERSONS FOR ACHIEVING EXCELLENCE FIN THE INTERNATIONAL EVENTS. 2.2. OVER THE YEARS A NUMBER OF NATIONAL SPORTS F EDERATIONS (NSFS) HAVE COME UP FOR DEVELOPMENT OF SPECIFIC GAMES/SPOR TS/DISCIPLINES, GOVERNMENT OF INDIA HAS BEEN ACTIVELY SUPPORTING TH ESE FEDERATIONS IN ACHIEVING THEIR OBJECTIVES. 2.3. GUIDELINES OF 2001 LAID DOWN THE FOLLOWING PRI NCIPLES, WHICH NOW, STAND SUBSUMED IN THE NATIONAL SPORTS DEVELOPMENT C ODE OF INDIA (NSCI) 2011; I. A CLEAR ROLE DELINEATION BETWEEN NSF, SAI AND T HE GOVERNMENT. II. GROUPING OF SPORT DISCIPLINES INTO PRIORITY, GENERAL AND OTHERS FOR THE PURPOSE FOR DETERMINING THE ENTITL EMENT FOR GOVERNMENT ASSISTANCE. III. DETAILED GUIDELINES FOR PREPARATION OF LONG TE RM DEVELOPMENT PLANS (4-YEAR CYCLE), PROVISION MADE FOR ANNUAL SAN CTION BUDGETS OF DEVELOPMENT PLANS. IV. BINDING TRIPARTITE AGREEMENTS BETWEEN NSFS, THE DEPARTMENT AND THE SAI TO BE DRAWN UP. ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 18 V. AN EMPHASIS ON PROFESSIONALIZING AND UPGRADING T HE ADMINISTRATIVE AND FINANCIAL MANAGEMENT OF FEDERATI ONS. VI. AN EMPHASIS ON SYSTEMS TO HANDLE PLAYERS GRIEV ANCE. VII. THE APPOINTMENT OF REGISTERED CHARTERED ACCOUN TANTS TO ENSURE MAINTENANCE OF PROPER AND TRANSPARENT ACCOUNTS. VIII. RECOGNITION OF THE ROLE OF SPORTS PROMOTERS, PARTICULARLY IN EVENT MANAGEMENT. 3. RECENT DEVELOPMENTS 3.1. HONBLE HIGH COURT OF DELHI, IN CIVIL WRIT PE TITION NO.7868 OF 2005, IN THE MATTER OF INDIAN HOCKEY FEDERATION, WH ILE DISPOSING OFF THE MATTER VIDE ORDER DATED 02.03.2010, CATEGORICALLY O BSERVED THAT THE GOVERNMENT GUIDELINES GOVERNING THE NSFS ARE VALID, BINDING AND ENFORCEABLE; AND THE TENURE CLAUSE IS NOT IN VIOLAT ION OF THE INTERNATIONAL OLYMPIC CHARTER. THE HONBLE COURT ALSO OBSERVED TH AT THE GOVERNMENT OF INDIA IS FULLY COMPETENT TO MAKE REGULATIONS ON NSF S AND IOA. THE HONBLE DELHI HIGH COURT FURTHER CITED ENTRY 10 AND 13 OF LIST I (UNION LIST) WHICH READ AS UNDER:- ENTRY 10 : FOREIGN AFFAIRS, ALL MATTERS WHICH BRING THE UNI ON INTO RELATION WITH ANY FOREIGN COUNTRY. ENTRY 13 : PARTICIPATION IN INTERNATIONAL CONFERENCES, ASSOC IATIONS AND OTHER BODIES AND IMPLEMENTING OF DECISIONS MADE THR EAT. BASED ON THE ABOVE, THE HONBLE COURT OBSERVED THAT WHILE AN NSF HAS AUTONOMY IN THE ACTUAL CONDUCT OF SPORTS, GOVERNMEN T RECOGNITION IS NECESSARY TO REPRESENT THE COUNTRY. IT FURTHER OBS ERVED THAT INTERNATIONAL ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 19 SPORTING EVENTS ARE AN ESSENTIAL PART OF DIPLOMATIC RELATIONS OF THE NATIONS, AND SEVERAL CONSIDERATIONS LIKE SECURITY CONCERNS O F PLAYERS, APARTHEID, AND PERCEIVED HUMAN RIGHTS VIOLATIONS HAVE GUIDED N ATIONS IN DECISIONS TO PARTICIPATE OR NOT TO PARTICIPATE IN SPORTING EVENT S IN DIFFERENT COUNTRIES. POLITICAL AND DIPLOMATIC CLEARANCES ARE, THEREFORE, REQUIRED BY THE INDIAN TEAMS BEFORE PARTICIPATION IN THE INTERNATIONAL TOU RNAMENTS AND FORUMS. THE COURT POINTED OUT THAT NO STATE GOVERNMENT HAS THE COMPETENCE OR THE JURISDICTION TO UNDERTAKE SUCH EXERCISE, WHICH IS THE SOLE PREROGATIVE OF THE UNION GOVERNMENT. 3.2. IN ANOTHER PUBLIC INTEREST LITIGATION NO.195/ 2010 IN THE MATTER OF RAHUL MEHRA VS. UOI AND OTHERS, THE HONBLE DEL HI HIGH COURT TOOK A SERIOUS VIEW ON THE MISMANAGEMENT OF THE SPORTS SEC TOR IN THE COUNTRY AND EXPRESSED DEEP CONCERN AT THE INACTION ON THE P ART OF THE GOVERNMENT IN IMPLEMENTING AND ENFORCING ITS OWN GUIDELINES, P ARTICULARLY THOSE RELATING TO AGE AND TENURE. 3.3. DURING THE XIII OLYMPIC CONGRESS HELD AT COPE NHAGEN IN 2009, IT WAS RESOLVED THAT EACH NATIONAL OLYMPIC COMMITTE E IS REQUIRED TO BE FULLY COMPLIANT WITH THE LAWS OF THE LAND. SINCE TH E HIGH COURT OF DELHI, WHILE HEARING THE MATTER OF GOVERNMENT GUIDELINES, INCLUDING THOSE ON AGE AND TENURE LIMIT, HAS REFUSED TO ACCEPT THE PRAYER OF NATIONAL SPORTS FEDERATIONS (NSFS), INCLUDING IOA, TO STAY THE OPER ATION OF THE SAID GUIDELINES, THEY AUTOMATICALLY BECOME LEGALLY ENFOR CEABLE AND THE NSFS, INCLUDING IOA ARE LEGALLY BOUND BY IT. FURTHER, THE INTERNATIONAL OLYMPIC COMMITTEE (IOC) HAS INFORMED THE GOVERNMENT THAT TH E IOA IS IN THE PROCESS OF AMENDING ITS CONSTITUTION BY ADOPTING TH E PRINCIPLES OF GOOD GOVERNANCE AND ENSURING VOTING MAJORITYOF NSFS TO B ECOME COMPLIANT ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 20 WITH THE IOC CHARTER. IOA HAS ALSO INDIATED THAT TH EY ARE IN THE PROCESS OF AMENDING THEIR CONSTITUTION IN LINE WITH THE IOC SU GGESTIONS. 3.4. THE GIST OF IMPORTANT NEW INITIATIVES TAKEN B Y THE GOVERNMENT IS INDICATED HEREUNDER. THESE HAVE BEEN SUITABLY INCOR PORATED IN THE SUBSEQUENT PARAGRAPHS OF GUIDELINES BY REPLACING TH E EXISTING PROVISIONS AND /OR ADDING THE NEW PROVISIONS. THE NEW PROVISIO NS SUPERSEDE THE EARLIER PROVISIONS IN THE 2001 GUIDELINES. 3.5. GIST OF NEW INITIATIVES TAKEN BY GOVERNMENT . IN THE RECENT PAST: RESTORING THE LIMITS ON DURATION OF TENURE OF OFFIC E BEARERS OF IOA AND ALL RECOGNIZED NATIONAL SPORTS FEDERATIONS.(ANN EXURE-XIII) GUIDELINES FOR GOOD GOVERNANCE IN THE CONTEXT OF B ASIC UNIVERSAL PRINCIPLE OF GOOD GOVERNANCE OF OLYMPIC AND SPORTS MOVEMENT.(ANNEXURE XIV) ANNEXURE RECOGNITION OF NATIONAL SPORTS FEDERATIONS (ANNEXURE XV) MEASURES TO COMBAT FRAUD IN AGE OF PLAYERS. (ANNEXU RE XVI) PREVENTION OF SEXUAL HARASSMENT OF WOMEN IN SPORTS, ETC. (ANNEXURE XVII) NOTIFYING IOA AND NSFS AS PUBLIC AUTHORITY UNDER RI GHT TO INFORMATION ACT. (ANNEXURE XVIII) DRAWL OF ADVANCE CALENDAR OF SPORTING EVENTS BOTH N ATIONAL AND INTERNATIONAL(ANNEXURE XIX) NATIONAL ANTI-DOPING RULES NOTIFIED VIDE GAZETTE NO TIFICATION NO.21-4/2008-ID DATED 5 TH FEBRUARY, 2010 (ANNEXURE XX) GUIDELINES FOR EFFICIENT MANAGEMENT OF COACHING CAM PS, SELECTION OF COACHES, SELECTION OF ATHLETES, ETC. ( ANNEXURE XXI) ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 21 REPRESENTATION OF INDIAN NATIONALS ONLY, IN NATIONA L TEAMS (ANNEXURE XXI) 3.6. THE NATIONAL SPORTS FEDERATIONS WHO HAVE THE RECOGNITION INCLUDING THE ANNUAL RECOGNITION OF GOVERNMENT OF I NDIA IN THE MINISTRY OF YOUTH AFFAIRS AND SPORTS, ENJOYS VARIOUS FACILITIES /CONCESSIONS PROVIDED BY THE GOVERNMENT OF INDIA. HOWEVER, FAILURE TO COMPL Y WITH THE GOVERNMENT GUIDELINES ISSUED FROM TIME TO TIME COULD RESULT IN ONE OR MORE OF THE FOLLOWING CONSEQUENCES FOR THE NSF CONCERNED:- 1) SHALL NOT BE ABLE TO SELECT THE NATIONAL TEAM S AND REPRESENT INDIA IN ANY INTERNATIONAL EVENT OR INTERNATIONAL FORUM(REFE RENCE: ENTRY 10 AND 13 OF UNION LIST IN THE SEVENTH SCHEDULE OF THE CONSTITUTION OF INDIA AND OBSERVATION OF HONBLE HIGH COURT IN THE CASE REFERRED TO ABOVE) 2) SHALL NOT BE ALLOWED TO USE THE WORD INDIA IN ITS NAME SINCE INCLUSION OF THE WORD INDIA SUGGESTS THE PATRONAG E OF GOVERNMENT OF INDIA. (REFERENCE: THE EMBLEMS AND NAMES (PREVEN TION OF IMPROPER USE) ACT, 1950 WHICH PROHIBITS THE USE OF INDIA IN THE NAME OF ANY ENTITY WITHOUT PRIOR APPROVAL OF THE GO VERNMENT, AS IT MAY SUGGEST OR BE CONSTRUED TO SUGGEST THE PATRONAG E OF THE GOVERNMENT) 3) SHALL LOSE ITS ALL INDIA CHARACTER AND MAY NO T BE ABLE TO REGULATE AND CONTROL THE CONCERNED SPORTS DISCIPLINE IN THE COUN TRY. (REFERENCE: MOST OF THE NSFS ARE REGISTERED UNDER THE SOCIETIES REGISTRATION ACT, 1860 OR UNDER A STATE SOCIETIES REGISTRATION A CT WHICH ARE OPERATIVE IN A PARTICULAR STATE AND AS SUCH WITHOUT THE RECOGNITION OF ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 22 CENTRAL GOVERNMENT, THE NSF CANNOT OPERATE BEYOND T HE BOUNDARIES OF THE STATE CONCERNED WHERE IT IS REGIS TERED.) 4) SHALL NOT BE ABLE TO AVAIL ITSELF OF CUSTOM DUT Y/EXEMPTION FOR IMPORT OF SPORTS GOODS, SPORTS EQUIPMENT, SPORTS REQUISITE S AS AN NSF/APEX BODY. (REFERENCE: DEPARTMENT OF REVENUES NOTIFICATION NO.5/2010-CUSTOMS DATED 19.10.2010 READ WITH NOTIFI CATION NO.146/94-CUSTOMS DATED 13.07.1994 ALLOWS THE CUSTO MS DUTY EXEMPTION TO NSF UNDER A CERTIFICATE ISSUED BY SAI; FURTHER NOTIFICATION NO.21/2002-CUSTOMS PROVIDES CUSTOM DUT Y EXEMPTION FOR IMPORT OF REQUISITES FOR GAMES AND SPORTS FOR A PEX BODY IN RELATION TO THE CONCERNED GAME OR SPORT). 5. SHALL NOT BE ABLE TO AVAIL ITSELF OF INCOME TAX EXEMPTIONS UNDER RELEVANT PROVISIONS OF THE ACT (E.G., AS PER THE SE C.80G(2)(VIII)(C) ANY SUM PAID BY THE ASSESSEES, BEING A COMPANY, IN THE PREVIOUS YEAR AS DONATIONS TO THE IOA OR TO ANY OTHER ASSOC IATION OR INSTITUTIONS ESTABLISHED IN INDIA, AS THE CENTRAL G OVERNMENT MAY, HAVING REGARD TO THE PRESCRIBED GUIDELINES, BY NOTI FICATION IN THE OFFICIAL GAZETTE SPECIFY IN THIS BEHALF FOR (I) TH E DEVELOPMENT OF INFRASTRUCTURE FOR SPORTS AND GAMES; (II) THE SPONS ORSHIP OF SPORTS AND GAMES; IS EXEMPTED FROM TAX). 6. SHALL NOT BE ABLE TO AVAIL ITSELF OF THE SPECIAL DISPENSATION AVAILABLE TO NSFS TO REMIT FUNDS TOWARDS SPONSORSHIP, PRIZE M ONEY FOR ACTIVITIES ABROAD (REFERENCE: FEMA (CURRENT TRANSAC TION) RULES 2000 SCHEDULE II SECTION 9) ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 23 7. PARTICIPATION IN NATIONAL AND INTERNATIONAL EVE NTS ORGANIZED BY NSFS THAT ARE NOT RECOGNIZED BY GOVERNMENT OF INDIA IN T HE MINISTRY OF YOUTH AFFAIRS AND SPORTS SHALL NOT BE CONSIDERED FO R APPOINTMENT TO GOVERNMENT JOBS UNDER SPORTS QUOTA (REFERENCE: DOPT S ORDERS) 8. THE SPORTSPERSONS OF THE UNRECOGNIZED NSFS MAY N OT BE ABLE TO GET ADMISSIONS UNDER SPORTS QUOTA IN SCHOOLS AND CO LLEGES. 9. THE SPORTSPERSONS PARTICIPATING IN NATIONAL CHAM PIONSHIPS ORGANIZED BY NSFS NOT RECOGNIZED BY GOVERNMENT OF I NDIA IN THE MINISTRY OF YOUTH AFFAIRS AND SPORTS SHALL NOT BE E NTITLED FOR RAILWAY CONCESSION OR OTHER CONCESSIONS GRANTED FOR THIS PU RPOSE. 8. FURTHER, THE RELIANCE IS PLACED BY THE ASSESSEE IN THE DECISIONS OF THE FOLLOWING FOUR CASES, WHICH ARE RELEVANT TO THE CAS E BEFORE US AND THEREFORE THEY ARE SUMMARIZED AS FOLLOWS:- 8.1 THE HONBLE ITAT AHMEDABAD BENCH IN THE CASE OF AHMADABAD MANAGEMENT ASSOCIATION VS. JDIT REPORTED IN (2013) 028 ITR ( TRIBUNAL ) 0349HAS HELD THAT PROMOTING THE PRACT ICE OF MANAGEMENT AND RELATED SUBJECTS THROUGH MEETINGS, DISCUSSIONS, LECTURES, R ESEARCH, PROJECTS, SEMINARS, CONFERENCES, PROGRAM OF STUDIES WOULD AMOUNT TO EDUCATION WITHIN THE MEANING OF SECTION 2(15) OF THE ACT. IN THIS JUDGMENT, THE HONBLE TRIBUNAL HAS, EXPANDED THE MEANING AND DEFINITION OF EDUCATION AS OBTAINED UNDER SECTION 2(15) OF THE ACT. 8.2. THE HONBLE ITAT CHENNAI BENCH IN THE CASE O F VEMPATI CHINNA SATYAM KUCHIPUDI ART FOUNDATION VS. DCIT REPORTED IN (2011 ) 010 ITR (TRIBUNAL ) 0201 HAS HELD THAT TOWARDS PROMOTING THE TRADITIONAL ART BY GIVING TRAINING IS NOT ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 24 REGULARLY GIVEN IN THE SCHOOL, COLLEGES, INSTITUTIO NS HAVING FORMAL FRAME AND THE ASSESSEE WHO IS ENGAGED IN THE PROMOTION OF THE TRA DITIONAL ART KUCHIPUDI BY GIVING TRAINING IS ENTITLED TO THE BENEFIT U/S. 10( 23)(IIIAD)- THE HONBLE TRIBUNAL EXPANDING THE SCOPE OF INSTITUTIONS FOR EDUCATIONA L PURPOSES TO QUALIFY FOR THE EXEMPTION AS IN THIS JUDGMENT IS DESPITE THE POSITI ON AS OBTAINED IN THE PROVISION THAT SUCH INSTITUTIONS SHOULD EXIST SOLELY FOR EDUC ATIONAL PURPOSES. 8.3. THE HONBLE KERALA HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. ST. MARYS MALANKARA SEMINARY REPORTED IN [2012 ] 348 ITR 69 (KER) HELD THAT THERE IS NOTHING TO INDICATE THAT SECTION 10(23C)(I IIAD) OF THE INCOME-TAX ACT, 1961, REQUIRES THE EDUCATIONAL INSTITUTIONS REFERRE D TO THEREIN TO IMPART EDUCATION IN ANY PARTICULAR SUBJECT OR IN ANY MANNER WHATSOEV ER. THE TERM EDUCATION ENJOYS A WIDE CONNOTATION COVERING ALL KINDS OF COA CHING AND TRAINING CARRIED ON IN A SYSTEMATIC MANNER LEADING TO PERSONALITY DEVEL OPMENT OF AN INDIVIDUAL. IN THE CASE OF A SEMINARY, STUDENTS ON COMPLETION OF T HEIR STUDIES ARE MADE PRIESTS WHO HEAD CHURCHES AS RELIGIOUS LEADERS PRACTICING A ND PROPAGATING RELIGION AS A PROFESSION. ACCORDINGLY, RELIGIOUS TEACHING IN THE SEMINARY IS ALSO EDUCATION AND SEMINARY IS, THEREFORE, AN EDUCATIONAL INSTITUTION ENTITLED FOR EXEMPTION U/S. 10(23C)(IIIAD). 8.4. RECENTLY, WHILE DECIDING THE CASE COUNSEL FOR INDIA SCHOOL CERTIFICATE EXAMINATIONS VS. DGIT VIDE ORDER DATED 20 TH MARCH, 2012 REPORTED IN (2012) 206 TAXMAN 466 (DELHI), HONBLE DELHI HIGH COURT HA S HELD THAT :- READING OF SEC.10(23)(VI) SHOWS THAT ANY UNIVERSITY OR OTHER EDUCATIONAL INSTITUTIONS EXISTING SOLELY FOR EDUCAT IONAL PURPOSES QUALIFIES UNDER THE CLAUSE. THE UNIVERSITY AND THE EDUCATIONA L INSTITUTION SHOULD NOT BE FOR THE PURPOSES OF PROFIT. THE SECOND REQUI REMENT IS NEGATIVE IN NATURE, WHEREAS THE FIRST REQUIREMENT IS POSITIVE. THE COURT CANNOT ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 25 ACCEPT THE CONTENTION OF THE REVENUE AND THE REASON ING GIVEN IN THE IMPUGNED ORDER THAT THE PETITIONER IS NOT AN EDUCAT IONAL INSTITUTION BECAUSE IT IS AN EXAMINED BODY AND ITS PRINCIPLE WO RK IS TO CONDUCT EXAMINATION AND CHARGE EXAMINATION FEE, ETC. THE WO RDS EDUCATIONAL INSTITUTION USED IN SECTION 10(23C)(VI) AND THE PHRASE EDUCATIONAL PUR POSES HAVE BEEN INTERPRETED AND EXAMINED IN SEVERAL CASES(PARA 4). IN CONCLUSION, HONBLE DELHI COURT HELD THAT COUNCIL FOR THE INDIA N SCHOLL CERTIFICATE EXAMINATIONS IS AN EDUCATIONAL INSTITUTION FOR THE PURPOSE OF SECTION 10(23C)(VI) OF THE INCOME-TAX ACT. 9. THUS, IT CAN BE CONCLUDED THAT THE SPORTS PROM OTION IS HUMAN RESOURCES DEVELOPMENT AND CONSIDERING THE POLICY DECLARATION OF GOVERNMENT OF INDIA, SPORTS IS CONST RUED AT PAR WITH EDUCATION . THE GOVERNMENT OF INDIA DOES CONSIDER PROMOTING A ND REGULATION OF SPORTS AS CONSTITUTIONAL OBLIGATION A ND DISCHARGES THE SAME THROUGH RECOGNIZED SPORTS FEDERATIONS IN INDIA LIKE THAT OF THE ASSESSEE. THE GOVERNMENT ALSO FORMULATES SPORTS MANAGEMENT AN D PROVIDES TRAINING AND TECHNICAL ASSISTANCE FOR DEVELOPMENT O F SPORTS IN INDIA. THE NATIONAL SPORTS FEDERATIONS LIKE THAT OF THE ASSESS EE HONORING THE NATIONAL DEVELOPMENT BOARD IS THE EXTENDED ARM OF G OVERNMENT PROVIDING TRAINING, COACHING, DEVELOPMENT OF SKILL AMONG THE SPORTSPERSONS IN INDIA. 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 WHI CH IS TAXABLE, AND SUCH PROFESSION IS ASSOCIATED WITH SYSTEMATIC A ND CONTINUES EDUCATION IN THE SPORT ONE PROFESS COUPLED WITH TRA INED PHYSICAL AND MENTAL FITNESS AND THEREFORE PROVIDING KNOWLEDG E IN ANY SPORT HAVE TO BE TREATED AT PAR WITH EDUCATION. ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 26 10. CONSIDERING THE RATIO OF THE AFORESAID DECISIONS AN D DISCUSSIONS, AND ALSO THE SCOPE OF SPORTS DEVELOPME NT IN INDIA, WE ARE OF THE VIEW THAT THE RECOGNIZED SPORTS ASSOCIAT ION IN INDIA, WHO IMPART KNOWLEDGE IN SPORTS, PROMOTION OF SPORTS BY CONDUCTING VARIOUS SPORTS ACTIVITIES IN ALL BRANCHES, TO FALL WITHIN THE SCOPE OF EDUCATION AS DEFINED UNDER THE AMENDED PROVISIONS OF SECTION-2(15) OF THE ACT . ACCORDINGLY WE HOLD THAT THE OBJECTS OF THE ASSESSEE SOCIETY WILL FALL WITHIN TH E 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 ASSESS EE SOCIETY WITH REGARD TO FIDE TRAINER COACH FEE ` 5,70,000/-, AICF CHRONICLE ` 2,53,300, PRIZE MONEY SHARE ` 5,51,500/-, RENT ON MONRAI SYSTEM ` 1,43,750/, TITLE FEES ` 3,00,500/-,TELECAST CHARGESDOORDARSHAN ` 12,00,000, AND FIDE REMITTANCES ` 15,35,052/- , WE FIND THAT ALL OF THEM RELATE TO THE ACTIVITIES WHICH ARE INCIDENTAL TO THE MAIN OBJECTS OF THE ASSESSEES SOCIETY AND THEREFORE, PROVISO TO SECTIO N 2(15) OF THE ACT WILL NOT BE ATTRACTED. BASED ON OUR AFORESAID DECISION T HE LEARNED ASSESSING OFFICER IS HEREBY DIRECTED TO MODIFY HIS ORDER ACCO RDINGLY. 6.4. FOR THE AFORESAID REASONS, WE HEREBY HOLD T HAT THE OBJECTS OF THE ASSESSEE TRUST FALLS WITHIN THE SCOPE OF THE FI RST LIMB OF SEC.2(15) OF THE ACT VIZ. EDUCATION AND THEREFORE, THE PROVISO TO SEC.2(15) OF THE ACT WILL NOT BE ATTRACTED AND ACCORDINGLY, THE ORDER OF THE LD. CIT (A) STANDS CONFIRMED. ITA NO. 1929/MDS/2014 M/S.DOLPHIN CLUB 27 7. IN THE RESULT, THE APPEAL OF REVENUE IS DISMISSE D. ORDER PRONOUNCED ON 13 TH NOVEMBER, 2014 AT CHENNAI. SD/- SD/- (CHALL A NAGENDRA PRASAD ) (A.MOHAN ALANKAMONY ) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 13 TH NOVEMBER, 2014. K S SUNDARAM. '# $%&% /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. '() /CIT(A) 4. ' /CIT 5. %*+ , /DR 6. +-. /GF