Deputy Commissioner of Income Tax, (Exemptions), Vijayawada V. Andhra Cricket Association (ACA), Vijayawada

ITA 280/VIZ/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 7779 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 7 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-01-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Appeal Filed On: 08-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D K SONAWAL
• Assessee Lawyers: M A RAHIM ITP
• Keywords: Charitable institution; Additional evidence
• Section: 143(3); 12A; 143(1); 10; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE SHRI V. DURGA RAO , HONBLE JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH , HONBLE ACCOUNTANT MEMBER ITA NO S . 279, 280 & 368 / VIZ /201 8 (ASST. YEAR : 20 13 - 14 TO 20 15 - 1 6 ) DCIT (EXEMPTIONS), VIJAYAWADA. V S . M/S. ANDHR A CRICKET ASSOCIATION (ACA), 5 & 8 , SWARNA RESIDENCY , ANNAPURNADEVI STREET, GANDHINAGAR, VIJAYAWADA. PAN NO. AAATT 2377 D (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI M.A. RAHIM - ITP DEPARTMENT BY : SHRI D.K. SONAWAL CIT DR DATE OF HEARING : 05 / 1 2 /201 9 . DATE OF PRONOUNCEMENT : 18 / 0 1 /201 9 . O R D E R PER BENCH : TH E S E APPEAL S BY THE REVENUE ARE DIRECTED AGAINST THE DIFFERENT ORDER S OF COMMISSIONER OF INCOME TAX (APPEALS) , VIJAYAWADA , DATED 01 /0 3 /201 8, 01/03/2018 & 17/04/2018 FOR THE ASSESSMENT YEARS 20 13 - 14, 2014 - 15 & 20 15 - 1 6 RESPECTIVELY . SINCE THE FACTS AND ISSUES ARE COMMON IN ALL THE APPEALS , CLUBBED AND HEARD TOGETHER AND DISPOSED OF BY WAY OF THIS CONSOLIDATED ORDER . FOR THE SAKE OF CONVENI EN CE, FACTS ARE TAKEN FROM ITA NO. 279/VIZ/2018 FOR A.Y. 2013 - 14 . 2 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) 2 THERE IS A DELAY OF 04 DAYS IN FILING THE APPEALS IN ITA NOS. 279 & 280/VIZ/2018 . THE REVENUE HAS FILED AN AFFIDAVIT WHEREIN EXPLAINED THE REASONS FOR DELAY IN FILING THE APPEAL S . WE FIND THAT THERE IS A SUFFICIENT CAUSE TO FILE THE APPEALS BELATEDLY . THEREFORE, WE ARE OF THE OPINION THAT DELAY HAS TO BE CONDONED. ACCORDINGLY, DELAY IS CON D ONED. 3 . GROUNDS OF APPEAL RAISED IN ITA NO. 279/VIZ/2018 ARE EXTRACTED AS UNDER: - 1. CIT(A) ERRED IN CONSIDERING THE FACT THAT THE ASSESSEE CARRIED OUT ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS AND EARNED PROFITS ON SALE OF TICKETS AND ADVERTISEMENT SPACE (BCCIT REIMBURSEMENTS OF RS.24,64,80,295/ - ) WHICH IS NOT ELIGIBLE FOR EXEMPTION U/S. 11 OR 10(23C) OF THE ACT. 2. CIT(A) IS ERRED IN NOT CON SIDERING THAT THE ACT OF SELLING TICKETS AT VARIED AMOUNTS/RATED DEPENDING ON THE STANDS N THE STADIUM AND MAINTAINING CORPORATE BOXES IS NOTHING BUT COMMERCIAL ACTIVITY. 3. CIT(A) ERRED IN COMING TO A CONCLUSION THAT FOR MANAGING THE CROWD TICKETS AT VARI ED AMOUNTS/RATED DEPENDING ON THE STANDS IN THE STADIUM IS REQUIRED. 4. CIT(A) OUGHT TO HAVE OBSERVED THE FACT THAT SALE OF IN STADIA ADVERTISEMENT SLOTS COMMES UNDER COMMERCIAL ACTIVITY WHICH IS NOTHING BUT TO EARN PROFIT. 5. CIT(A) IS NOT CORRECT IN CONSIDERING THAT THE RECEIPTS BY WAY OF TELEVISION SUBSIDY AND IPL SUBVENTION RECEIPTS FROM BCCI ARE NOT BEARING COMMERCIAL CHARACTER AND VOLUNTARY DONATIONS FROM BCCI IN SPITE OF THE FACT THAT THE RECEIPTS ARE DEPENDING ON SHARE OF THE ASSESSEE - SOCIETY FO R A PARTICULAR MATCH/MATCHES AND THE SAME ARE NOT EQUALLY DISTRIBUTED TO ALL THE AFFILIATED UNITS OF BCCI WHICH IS NOTHING BUT PROFIT SHARING. 6. CIT(A) ERRED IN CONSIDERING THAT RECEIPTS FROM BCCI ARE OF VOLUNTARY IN NATURE IN SPITE OF THE FACT THAT THE A SSESSEE - SOCIETY IS RECEIVING THE SAME FOR ORGANIZING MATCHES AND PURCHASE OF LIVE TELECAST OF THE MATCHES ORGANIZED IN THE 3 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) REGION OF THE ASSESSEE - SOCIETY BY BCCI. 7. CIT(A) IS NOT JUSTIFIED IN HOLDING THAT THE ASSESSEE IS CARRYING ON CHARITABLE ACTIVITIES DESPITE OF EARNING MORE THAN RS. 25 LAKHS FROM COMMERCIAL ACTIVITY, WHICH IS VIOLATION OF PROVISION OF SECTION 2(15) OF THE I. T. ACT. 8. CIT(A) OUGHT TO HAVE CONSIDERED THE FACT THAT THE COMMERCIAL RECEIPTS ARE MORE THAN 25 LAKHS AS SPECIFIED IN THE PROVI SO TO SECTION 2(15) AND ACCORDINGLY THE ACTIVITY OF THE ASSOCIATION DOES NOT QUALIFY AS A CHARITABLE ACTIVITY WITHIN THE MEANING OF SECTION 2(15) OF THE ACT. 9. CIT(A) IS NOT CORRECT IN DIRECTING TO GRANT EXEMPTION U/S. 11 OR U/S. 10(23C) OF THE ACT IN SPI TE OF NOT FULFILLING THE CONDITIONS LAID DOWN IN GRANTING SUCH APPROVALS BY THE CONCERNED AUTHORITIES THAT THE ACTIVITIES RENDERED BY THE ASSESSEE - SOCIETY ARE OUT OF THE PURVIEW OF 'CHARITABLE PURPOSE' AS DEFINED IN SECTION 2(15) OF THE ACT. 10. ANY OTHER GROUND THAT MAY BE URGED AT THE TIME OF HEARING OF THE CASE. 4 . FROM THE READING OF ALL THE ABOVE GROUND S , T HE SUM S AND SUBSTANCE OF THE CASE OF THE DEPARTMENT IS THAT THE ACTIVITY CARRIED BY THE ASSESSEE IS IN THE NATURE OF TRADE, COMMERCE, BUSINESS. THEREFORE, THE ASSESSEE IS NOT ELIGIBLE FOR EXE MPTION UNDER SECTION 11, THOUGH ASSESSEE IS HAVING REGISTRATION UNDER SECTION 12A AND APPROVAL UNDER SECTION 10(23C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS 'ACT') . 5 . FACTS OF THE CASE IN BRIEF ARE THAT ASSESSEE - M/S. ANDHRA CRICKET ASSOCIATION (ACA) IS REGISTERED UNDER SECTION 12A OF THE ACT W.E.F. 01/04/1993 VIDE ORDER OF COM MISSIONER , GUNTUR IN H.QRS. NO. I(516)/GNT/94 - 95 , DATED 21/02/1995 . THE ASSESSEE ALSO OBTAINED GRANT OF APPROVAL UNDER SECTION 10(23C)(IV) VIDE PROCEEDINGS OF THE LD .CCIT - III, HYDERABAD (CCIT - III/TECH/ 4 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) 10(23C) (IV)/18/08 - 09 ) , DATED 27/02/2009 . THE ASSESSEE HAD FILED ITS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION (13 - 14) ON 30/09/2013 BY ADMITTING NIL INCOME. THE RETURN FILED BY THE ASSESSEE WAS PROCESSED UNDER SECTION 143(1) AND SUBSEQUENTLY, THE CASE WAS SELECTED FOR SCRUTINY AND ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) OF THE ACT. THE ASSESSEE HAS CLAIMED ITS INCOME AS EXEMPTION ON THE GROUND THAT AS SESSEE IS HAVING REGISTRATION UNDER SECTION 12A AND APPROVAL UNDER SECTION 10(23C)(IV) OF THE ACT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS , THE ASSESSING OFFICER HAS ASKED THE ASSESSEE WHY YOU R CASE HAS TO BE CONSIDERED FOR EXEMPTION UNDER SECTION 11 OF THE ACT. IT WAS SUBM ITTED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER THAT THE MAIN OBJECT OF THE ASSESSEE IS FOR PROMOTION OF GAME OF CRICKET AND THE ACTIVITIES CARRIED BY THE ASSESSEE ARE IN ACCORDANCE WITH THE OBJECTS OF THE ASSOCIATION, FOR WHICH IT IS EXISTED , AND THE ASSESSEE IS ALREADY HAVING REGISTRATION UNDER SECTION 12A AS WELL AS APPROVAL UNDER SECTION 10(23C)(IV) OF THE ACT AND SUBMITTED THAT THE ACTIVITIES ARE CARRIED BY THE ASSESSEE ARE CHARITABLE IN NATURE , T HEREFORE, HIS INCOME IS EXEMP T UNDER SECTION 11 OF THE ACT. THE ASSESSING OFFICER HAS NOT ACCEPTED THE EXPLANATION OF THE ASSESSEE AND HE CAME TO A CONCLUSION THAT THE ACTIVITIES CARRIED BY THE ASSESSEE ARE IN THE NATURE OF TRADE, 5 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) COMMERCE AND BUSINESS, HENCE, IS NOT ELIGIBLE FOR EXE MPTION UNDER SECTION 11, THOUGH ASSESSEE IS HAVING REGISTRATION UNDER SECTION 12A AS WELL AS APPROVAL UNDER SECTION 10(23C)(IV) OF THE ACT . THE ASSESSING OFFICER NOTED THAT T HE ASSESSEE DURING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2013 - 14 HAS CARRIED ON THE ACTIVITIES OF PROMOTION OF CRICKET GAME AND SOL D TICKETS TO THE VIEWERS , WHICH HITS THE PROVISO TO SECTION 2(15) OF THE ACT. ACCORDING TO THE ASSESSING OFFICER , THE ASSESSEE HAS CARRIED THE ACTIVITIES OF STAGING THE GAME OF CRICKET IN THE STADIUM OWNED BY IT BY SELLING TICKETS TO THE VIEWERS IN A COMMERCIAL MANNER OF ANY ADVENTURE INCLUDED IN THE DEFINITION OF BUSINESS AS DEFINED IN SECTION 2(13) OF THE ACT. HE FURTHER NOTED THAT THE ASSESSEE HAS CARRIED A BUSINESS IN ORGANIZING INDIA VS. NEW ZEALAND, T20 CRICKET MATCH , DURING THE PREVIOUS YEAR RELEVANT TO THE A.Y. 2013 - 14 AND TOTAL RECEIPTS FROM CONDU C TING THE GAME OF CRICKET DURING THE YEAR WAS RS.4,33,10,999/ - . THEREFORE, ACCORDING TO THE ASSESSING OFFICER THE PROVISO TO SECTION 2(1 5) ATTRACTS AS THE RECEIPTS ARE MORE THAN RS.25.00 LAKHS . THE ASSESSING OFFICER FURTHER OBSERVED THAT THE ASSESSEE CONDUCT ED INTERNATIONAL, NATIONAL CHAMPIONSHIP MATCHES ARE IN THE COMMERCIAL LINES BY SEL L ING TICKETS TO THE VIEWERS CONSTITUTING BUSINESS OF THE ASSESSEE, THERE IS NO CHARITY. THEREFORE, ASSESSEE 6 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) IS NOT ENTITLED FOR EXEMPTION 10(23C)(IV) OF THE ACT. THE ASSESSING OFFICER FURTHER NOTED THAT DURING THE YEAR , THE ASSESSEE HAS RECEIVED THE FOLLOWING REIMBURSEMENTS: - 1. ANNUAL SUBSCRIPTIONS RS. 26,000 00 2. BCCI REIMBURSEMENTS RS. 24,64,80,295 - 00 3. INDIA VS. WEST INDIES MATCH RS. 92,64,529 - 00 4. INTEREST ON FDRS & SB A/CS. RS. 3,71,53,022 - 00 5. SPONSORING CO - COLA TOURNAMENT RS. 3,75,966 - 00 6. RENTS RECEIVED RS. 10,29,912 - 00 7. INDIA VS. NEW ZEALAND MATCH RS. 4,33,10,999 - 00 ACCORDING TO THE ASSESSING OFFICER, THE ASSESSEE I S A MEMBER OF BCCI AND THE REIMBURSEMENT OF EXPENSES RECEIVED BY THE ASSESSEE IS NOT A VOLUNTARY CONTRIBUTION , AND ALSO POINTED OUT THAT THE ASSESSEE RESERVES CERTAIN BOXES FOR EMINENT PERSONS OF PUBLIC LIFE WITHOUT COST. THEREFORE, THE ACTIVITIES CARRIED BY THE ASSESSEE CANNOT BE SAID THAT IT IS CHARITABLE IN NATURE. IN VIEW OF THE ABOVE, THE ASSESSING OFFICER WAS OF THE OPINION THAT THE ASSESSEE HAS INVOLVED IN CARRYING COMMERCIAL ACTIVITIES CONSTITUTING BUSINESS AS CONTEMPLATED IN 1 ST PROVIS O TO SECTION 2(15) AND RECEIPTS FROM SUCH COMMERCIAL ACTIVITY WERE MORE THAN THE STIPULATED AMOUNT OF RS. 25.00 LAKHS AS PER 2 ND PROVISO TO SECTION 2(15) . HENCE, 1 ST PROVISO TO SECTION 2(15) IS ATTRACTED TO THE 7 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) ASSESSEES CASE, AS SUCH THE ASSESSEE IS NOT ELIGIBLE FOR EXEMPTION UNDER SECTION 10(23C)(IV) OF THE ACT FOR THE ASSESSMENT YEAR 2013 - 14 . INSOFAR AS CLAIM OF TH E ASSESSEE FOR EXEMPTION UNDER SECTION 11 IS CONCERNED, THE ASSESSING OFFICER HAS NOTED THAT THE ASSESSEE HAS CARRI ED THE ACTIVITIES OF GAME OF CRICKET BY SELLING TICKETS , PAID SERVICE TAX AND THE SAME IS RECEIVED FROM BCCI OF RS. 3,04,64,964/ - . SINCE BCCI IS NOT EXEMPTED FROM PAYMENT OF SERVICE TAX FOR BEING NOT CHARITABLE, ASSESSEE CANNOT BE CONSIDERED AS ITS ACTIVITIES ARE CHARITY IN NATURE . THEREFORE, THE ASSESSING OFFICER IS OF THE OPINION THAT THOUGH THE ASSESSEE IS HAVING REGISTRATION U NDER SECTION 12A, HIS INCOME IS NOT EXEMPT UNDER SECTION 11 OF THE ACT. 6 . ON BEING AGGRIEVED , THE ASSESSEE CARRIED THE MATER IN APPEAL BEFORE THE LD. CIT(A). IT WAS SUBMITTED BEFORE THE LD.CIT(A) THAT THE MAIN OBJECT OF THE ASSESSEE - ASSOCIATION IS TO DEVELOP THE GAME OF CRICKET , AND THE CRICKET MATCHES CONDUCTED ON BEHALF OF THE BCCI IN THE STADIUM OWNED BY THE ASSESSEE IS ONLY INCIDENTAL AND SUBMITTED THAT THE ACTIVITY CARRIED BY THE ASSESSEE IS CHARITABLE IN NATURE . AS THE ASSESSEE IS HAVING REGISTR ATION UNDER SECTION 12A AND ALSO APPROVAL UNDER SECTION 10(23C)(IV) OF THE ACT, ASSESSEES INCOME IS EXEMPT UNDER SECTION 11 OF THE ACT AS WELL AS SECTION 10(23C)(IV) OF THE ACT. THE 8 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) LD.CIT(A) BY CONSIDERING A DETAILED EXPLANATION GIVEN BY THE ASSESSEE AN D BY FOLLOWING THE ORDER PASSED BY THE ITAT, VISAKHAPATNAM BENCH IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR S 2010 - 11 & 2011 - 12 & 2012 - 13 , BY ORDER DATED 10/11/2017 HAS HELD TH A T REGISTRATION GRANTED UNDER SECTION 12A IS NOT CANCELLED AND THE ASSESSING OFFICER HAS NOT POINTED OUT ANY SPECIFIC VIOLATION OF CONDITIONS ME N TI O NED IN THE APPROVAL GRANTED UNDER SECTION 10(23C)(IV) AND HELD THAT ASSESSEE IS ELIGIBLE FOR EXEMPTION UNDER THE PROVISIONS OF SECTION 11, 12 & 13 OF THE ACT. 7 . ON BEING AGGRIEVED, REVENUE CARRIED THE MATTER IN APPEAL BEFORE THE TRIBUNAL . 8 . LD. DEPARTMENTAL REPRESENTATIVE HAS STRONGLY SUPPORTED THE ORDER PASSED BY THE ASSESSING OFFICER AND SUBMITTED THAT THE MAIN INCOME OF THE ASSESSEE IS REIMBURSEMENT OF EXPENSES RECEIVED FROM BCCI AND THE SAME IS RECEIVED IN CONNECTION WITH CONDUCTING VARIOUS INTERNATIONAL CRICKET MATCHES. THEREFORE, THE ACTIVITY CARRIED BY THE ASSESSEE IS IN THE NATURE OF TRADE, COMMERCE AND BUSINESS. THEREFORE, ASSESSEE IS NOT ENTITLED FOR EXEMPTION UNDER SECTI ON 11 OF THE ACT. 9 . ON THE OTHER HAND, SHRI M.A. RAHIM , ITP HAS POINTED OUT THAT THE MAIN OBJECT OF THE ASSESSEE IS TO DEVELOP THE GAME OF THE CRICKET IN THE ENTIRE STATE OF ANDHRA PRADESH AND TO IMPART 9 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) PHYSICAL EDUCATION THROUGH THE MEDIUM OF CRICKET AND SUBMITTED THAT THE ACTIVITY CARRIED BY THE ASSESSEE IS A CHARITABLE IN NATURE , HENCE PROVISO TO SECTION 2(15) HAS NO APPLICATION. 10. IT IS FURTHER SUBMITTED THAT THE ASSESSEE HAS ALREADY GOT REGISTRATION UNDER SECTION 12A AND ALSO APPROVAL UNDER SECTION 10(23C)(IV) OF THE ACT. THEREFORE, ASSESSEE IS ENTITLED FOR EXEMPTION UNDER SECTION 11 OF THE ACT. 11. IT IS FURTHER SUBMITTED THAT THE ASSESSING OFFICER HAS NOT POINTED OUT THAT THE ACT IVITY CARRIED BY THE ASSESSEE IS CONTRARY TO THE OBJECTS OF THE ASSESSEE - ASSOCIATION . HE HAS ALSO NOT POINTED OUT ANY NEW ACTIVITY CARRIED BY THE ASSESSEE AFTER REGISTRATION UNDER SECTION 12A AND APPROVAL UNDER SECTION 10(23C)(IV) OF THE ACT. THEREFORE, THE ASSESSING OFFICER SIMPLY DENIED THE CLAIM OF THE ASSESSEE UNDER SECTION 11 OF THE ACT ON THE GROUND THAT THE ASSESSEES ACTIVITIES CARRIED ARE COMMERCIAL IN NATURE IS WITHOUT ANY BASIS AND THE OBSERVATIONS MADE BY THE ASSESSING OFFICER THAT THE ACTIVITIES CARRIED BY THE ASSESSEE ARE COMMERCIAL IN NATURE, IS NOT CORRECT AND CONTRARY TO THE FACTS OF THE CASE. 12. LD. COUNSEL FOR THE ASSESSEE HAS FURTHER SUBMITTED THAT THE ISSUE I NVOLVED IN THIS APPEAL IS SQUARELY COVERED BY THE DECISION OF THE COORDINATE BENCH OF THE VISAKHAPATNAM TRIBUNAL IN ITA NO S . 10 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) 963 & 241/VIZ/2015 & ITA NO. 01/VIZ/2016 FOR ASSESSMENT YEARS 2010 - 11 TO 2012 - 13 , BY ORDER DATED 10/11/2017. HE ALSO STRONGLY RELIED ON THE ORDER PASSED BY THE LD. CIT(A). 1 3 . WE HAVE HEARD BOTH THE SIDES, PERUSED THE MATERIAL AVAILABLE ON RECORD AND ORDERS OF THE AUTHORITIES BELOW. 1 4 . THE ASSESSEE IS A ANDHRA CRICKET ASSOCIATION AND HAS BEEN GRANTED REGISTRATION UNDER SECTION 12A W.E.F. 01/04/1993 BY THE REVENUE AND APPROVAL UNDER SECTION 10(23C)(IV) DATED 27/02/2009 BY CONSIDERING THE FOLLOWING OBJECTS: - A) TO MAINTAIN A GENERAL CONTROL OF THE GAME OF CRICKET IN THE STATE AND GIVE ITS DECISION IN ALL MATTERS CONCERNING THE GAME EITHER WHEN REFERRED TO OR SUO MOTO. B) TO SPREAD THE GAME THROUGHOUT THE STATE BY ORGANIZING TOURNAMENTS SUCH AS INTER - DISTRICT, INTER - ZONAL , INTER - SCHOOL AND INTER - ASSOCIATION MATCHES, TO EDUCATE YOUNG SPORTSMEN IN THE GAM E GENERALLY AND ALSO IN THE FIELD OF PHYSICAL CULTURE AND THE SPIRIT OF SPORTSMANSHIP. C) TO PROVIDE, ACQUIRE AND MAINTAIN SUITABLE PLACES, GROUNDS, CLUB HOUSES AND OTHER LOCALITIES TO AFFORD FACILITIES FOR CRICKETERS AND TO RUN A JOURNAL DEVOTED TO SPORTS IN GENERAL AND CRICKET IN PARTICULAR. D) TO CONSTRUCT STADIA, ACQUIRE SUITABLE PLAYGROUNDS AND OTHER ASSETS REQUIRED FOR THE PROMOTION OF THE GAME OF CRICKET. E) TO IMPART PHYSICAL EDUCATION THROUGH THE MEDIUM OF CRICKET. F) TO SPREAD THE IDEALS OF CRICKET AND ALL THAT IT STANDS FOR THROUGHOUT THE LENGTH AND BREADTH OF ITS AREA BY ESTABLISHING ACADEMIES FOR COACHING AND CONDUCTING COACHING CAMPS AND FOR BY ARRANGING SCHOOLS FOR COACHING ETC. G) TO REGULATE AND CONTROL THE GAME OF CRICKET ETC. ETC. FROM THE ABOVE , IT IS CLEAR THAT THE MAIN OBJECTS OF THE ASSESSEE ARE RELATING TO DEVELOPMENT OF GAME OF CRICKET AND TO 11 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) IMPART PHYSICAL EDUCATION THROUGH THE MEDIUM OF CRICKET AND TO REGULATE AND CONTROL THE GAME OF CRICKET IN THE ENTIRE STATE OF ANDHRA PRADESH . FOR THAT PURPOSE , THE ACTIVITIES CARRIED BY THE ASSESSEE IS TREATED AS CHARITABLE IN NATURE AND 12A REGISTRATION IS GRANTED AND NOT ONLY THAT, BY CONSIDERING THE VERY SAME OBJECTS, THE CHIEF COMMISSIONER OF INCOME TAX HAS GRANTED APPROVAL UNDER SECTION 10(23C)(IV) OF THE ACT. THE ACTIVITIES CARRIED BY THE ASSESSEE FROM THE BEGINNING ARE SAME AND NO FRESH ACTIVITIES ARE UNDERTAKEN BY THE ASSESSEE. THIS FACT IS NOT DISPUTED BY THE DEPARTMENT. THE CASE OF THE ASSESSING OFFICER IS THAT THE A SSESSEE SELLING TICKETS IN RESPECT OF INTERNATIONAL CRICKET GAMES AND ALSO RECEIVED REIMBURSEMENTS FROM THE BCCI WHICH IS COMMERCIAL IN NATURE. THE ASSESSING OFFICER HAS FURTHER NOTED THAT THE ASSESSEE HAS RESERVED BOXES FOR EMINENT PERSONS OF PUBLIC LIFE WITHOUT COST. THEREFORE, THE ACTIVITY CARRIED BY THE ASSESSEE HITS BY PROVISO TO SECTION 2(15) OF THE ACT AND THEREFORE THE ASSESSEE IS NOT ENTITLED FOR HIS INCOME AS EXEMPT UNDER SECTION 11 AS WELL AS 10(23C) OF THE ACT. WE FIND THAT THE ASSESSEE OWNED A CRICKET STADIUM WHICH IS CONSTRUCTED FOR THE PURPOSE OF DEVELOPMENT OF SPORT OF CRICKET . THE ASSESSEE BEING A MEMBER OF BCCI, HOST ING MATCHES WHICH ARE CONDUCTED BY BCCI , EXPENDITURE FOR CONDUCTING THE MATCHES CLAIMED BY THE ASSESSEE 12 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) AS REIMBURSEMENT FROM THE BCCI. THE ASSESSEE IS SELLING THE TICKETS ON BEHALF OF THE BCCI, THEREFORE, SEL L ING OF TICKETS BY THE ASSESSEE CANNOT BE CONSIDERED AS COMMERCIAL ACTIVITY. THE MAIN INTENTION OF THE ASSESSEE IS TO DEVELOP THE GAME OF THE CRICKET . SOMETIMES , THE MATCHES SPONSORED BY THE BCCI, CONDUCTED IN THE ASSESSEES STADIUM AND FOR THAT PURPOSE TICKETS ARE SOLD AND EXPENSES INCURRED COLLECTED AS REIMBURSEMENT. THE SELLING OF THE TICKETS BY THE ASSESSEE IS ONLY ON BEHALF OF THE BCCI. THE ASSESSING OFFICER HA S ALSO POINTED OUT THAT IN RESPECT OF SELLING OF TICKETS OF THE CRICKET MATCH, BCCI PAID SERVICE TAX. THEREFORE, BCCI IS SIMILAR TO THE ASSESSEE THEREFORE ASSESSEES ACTIVITY CANNOT BE TREATED AS CHARITABLE ACTIVITY. WE FIND THAT INTERNATIONAL MATCHES HOS T ED BY THE ASSESSEE IN ITS STADIUM ON BEHALF OF THE BCCI AND FOR THAT PURPOSE TICKETS ARE SOLD ON BEHALF OF THE BCCI , WHATEVER EXPENSES ARE INCURRED WERE COLLECTED AS REIMBURSEMENT, THE PAYMENT OF SERVICE TAX BY THE BCCI NOTHING TO DO WITH THE ASSESSEES ACTIVITY. THE ACTIVITY OF THE ASSOCIATION IS TO CONDUCT THE TRAINING PROGRAMME, COACHING CLASSES FOR THE STUDENTS AT DISTRICT LEVEL AND STATE LEVEL. THIS IS THE MAIN OBJECT OF THE ASSESSEE. SO FAR AS CONDUCTING INTERNATIONAL MATCHES ARE CONCERNED, WHENEVER IT IS SPONSORED BY THE BCCI ONCE OR TWICE IN A YEAR, THE ASSESSEE HAS TO UNDERTAKE AS PER THE DIRECTIONS OF THE 13 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) BC CI. THE ASSESSEE TO ACHIEVE HIS OBJECTS I.E. DEVELOPMENT OF THE GAME OF CRICKET THROUGHOUT ANDHRA PRADESH , IT REQUIRES CERTAIN FUNDS , UNLESS FUNDS ARE AVAILABLE IT IS NOT POSSIBLE FOR THE ASSESSEE TO ACHIEVE ITS OBJECTS. THEREFORE, THE ASSESSEE IS ALREAD Y HAVING A STADIUM AND MATCHES ARE CONDUCTED ON BEHALF OF THE BCCI AND THE EXPENSES INCURRED WERE COLLECTED AS REIMBURSEMENT AND ALSO CERTAIN VOLUNTARY DONATIONS. THEREFORE, DOMINANT OBJECT OF THE ASSESSEE IS TO DEVELOP THE GAME OF THE CRICKET AND CONDUCT ING TRAINING PROGRAMME, COACHING CLASSES FOR THE STUDENTS AT DISTRICT LEVEL AND STATE LEVEL . SO FAR AS CONDUCTING INTERNATIONAL MATCHES ON BEHALF OF THE BCCI IS INCIDENTAL TO THE MAIN ACTIVITIES CARRIED BY THE ASSESSEE. SO FAR AS EXPENDITURE INCURRED BY THE ASSESSEE, THE ASSESSING OFFICER HAS NOT POINTED OUT ANYTHING THAT EXPENDITURE INCURRED IS NOT RELATED TO THE OBJECTIVES OF THE ASSESSEE. THE ASSESSING OFFICER SIMPLY OBSERVED THAT THE ACTIVITIES CARRIED BY THE ASSESSEE IS COMM ERCIAL IN NATURE , BUT NOWHERE HE HAS SUBSTANTIATED WITH ESTABLISHING FACT THAT THE ACTIVITY CARRIED BY THE ASSESSEE IS COMMERCIAL IN NATURE. WE FIND THAT THE ASSESSEE HAS INCURRED EXPENDITURE IN RELATION TO THE OBJECTS OF THE ASSOCIATION AND ALSO RECEIVED REIMBURSEMENT FROM BCCI IN CONNECTION WITH THE OBJECTS OF THE ASSESSEE - ASSOCIATION. THEREFORE, THE ACTIVITIES CARRIED BY THE ASSESSEE CANNOT BE CONSIDERED AS A COMMERCIAL IN 14 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) NATURE AND NOT ATTRACT S THE PROVISO TO SECTION 2(15 ) OF THE ACT. WE FIND THAT THE ASSESSEE IS NOT PROVIDING ANY SERVICE TO TRADE, COMMERCE AND BUSINESS AND THEREFORE, IN OUR OPINION , THE PROVISION TO SECTION 2(15) HAS NO APPLICATION. FOR THE SAKE OF CONVENIENCE , PROVISO TO SECTION 2(15) IS EXTRACTED AS U NDER: - PROVIDED THAT THE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY SHALL NOT BE A CHARITABLE PURPOSE, IF IT INVOLVES THE CARRYING ON OF ANY ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS, OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS, FOR A CESS OR FEE OR ANY OTHER CONSIDERATION, IRRESPECTIVE OF THE NATURE OF USE OR APPLICATION, OR RETENTION, OF THE INCOME FROM SUCH ACTIVITY, UNLESS ( I ) SUCH ACTIVITY IS UNDERTAKEN IN THE COURSE OF ACTUAL CA RRYING OUT OF SUCH ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY; AND ( II ) THE AGGREGATE RECEIPTS FROM SUCH ACTIVITY OR ACTIVITIES DURING THE PREVIOUS YEAR, DO NOT EXCEED TWENTY PER CENT OF THE TOTAL RECEIPTS, OF THE TRUST OR INSTITUTION UNDERT AKING SUCH ACTIVITY OR AC TIVITIES, OF THAT PREVIOUS YEAR. A BARE READING OF THE ABOVE PROVISO, IT IS CLEAR THAT IF THE ASSESSEE INVOLVES IN CARRYING ON ANY ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS, OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS, FOR A CESS OR FEE OR ANY OTHER CONSIDERATION , THEN PROVISO TO SECTI O N 2(15) SHALL ATTRACT . IN THE PRESENT CASE, THE ASSESSEE IS A CHARITABLE ASSOCIATION CARRYING WITH THE OBJECT OF DEVELOPMENT OF GAME OF CRICKET AND NOT INVOLVED IN ANY ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS N OR RENDERED ANY SERVICE IN RELATION TO ANY 15 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) TRADE COMMERCE OR BUSINESS. THEREFORE, PROVISO TO SECTION 2(15) HAS NO APPLICATION TO THE ASSESSEES CASE. 15 . THE COORDINATE BENCH OF THE VISAKHAPATNAM TRIBUNAL HAS CONSIDERED THE ACTIVITIES CARRIED BY THE ASSESSEE IN THE CASE OF ASSESSEE ITSELF FOR THE ASSESSMENT YEAR S 2010 - 11 TO 2012 - 13 IN ITA NOS. 93 & 241/VIZ/2015 & ITA NO. 01/VIZ/2016 , DATED 10/11/2017 AND HELD THAT INCOME ADMITTED BY THE ASSESSEE UNDER THE MAJOR HEADS, SUCH AS BCCI REIMBURSEMENTS, INTEREST ON FDR AND SAVINGS BANK ACCOUNTS . OUT OF THESE RECEIPTS, THE ASSESSEE INCURRED EXPENDITURE TOWARDS CONDUCTING VARIOUS TOURNAMENTS, GRANTS TO DISTRICT ASSOCIATIONS FOR CONDUCTING LEAGUE TOURNAMENTS AND DEVELOPMENT OF GAME AND OTHER HEADS, SUCH AS ADMINISTRATIVE & MAINTENANCE. FROM THE ABOV E , IT IS CLEAR THAT THE RECEIPTS RECEIVED BY THE ASSESSEE IS IN RELATION TO SPORTS OF CRICKET AND ALSO INCURRED EXPENSES TOWARDS DEVELOPMENT OF STADIUM WHICH IS ALSO RELATED TO SUPPORTS OF CRICKET AND ALSO CLEARING THE LAND FOR THE PURPOSE OF CONSTRUCTION OF STADIUM WHICH IS ALSO RELATED TO SPORTS OF CRICKET , CERTAIN FUNDS ARE GRANTED TO THE DISTRICT ASSOCIATION FOR THE PURPOSE OF DEVELOPMENT OF CRICKET OR SPORTS, THEREFORE ALL THE RECEIPTS RECEIVED BY THE ASSESSEE ARE INCURRED IN CONNECTION WITH THE SPORTS OF THE CRICKET. THEREFORE, THE ASSESSING OFFICER IS NOT JUSTIFIED IN OBSERVING THAT THE ACTIVITIES 16 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) OF THE ASSESSEE ARE BUSINESS ACTIVITIES AND WE UPHELD THE ORDER PASSED BY THE LD. CIT(A). 1 6 . THE HON'BLE DELHI HIGH COURT IN THE CASE OF INDIA TRADE PROMO TION ORGANISATION VS. DIRECTOR GENERAL OF INCOME TAX (EXEMPTIONS) & OTHERS IN W.P.(C) NO. 1872/2013, DATED 22/01/2015 HAS CONSIDERED THE SCOPE OF PROVISO TO SECTION 2(15) AND CONCLUDED BY THE HON'BLE DELHI HIGH COURT BY THEIR LORDSHIPS AS UNDER: - 58. IN CONCLUSION, WE MAY SAY THAT THE EXPRESSION 'CHARITABLE PURPOSE', AS DEFINED IN SECTION 2(15) CANNOT BE CONSTRUED LITERALLY AND IN ABSOLUTE TERMS. IT HAS TO TAKE COLOUR AND BE CONSIDERED IN THE CONTEXT OF SECTION 10(23C)(IV) OF THE SAID ACT. IT IS ALSO CLEAR THAT IF THE LITERAL INTERPRETATION IS GIVEN TO THE PROVISO TO SECTION 2(15) OF THE SAID ACT, THEN TH E PROVISO WOULD BE AT RISK OF RUNNING FOWL OF THE PRINCIPLE OF EQUALITY ENSHRINED IN ARTICLE 14 OF THE CONSTITUTION INDIA. IN ORDER TO SAVE THE CONSTITUTIONAL VALIDITY OF THE PROVISO, THE SAME WOULD HAVE T O BE READ DOWN AND INTERPRETED IN THE CONTEXT OF SECTION 10(23C)(IV) BECAUSE, IN OUR VIEW, THE CONTEXT REQUIRES SUCH AN INTERPRETATION. THE CORRECT INTERPRETATION OF THE PROVISO TO SECTION 2(15) OF THE SAID ACT WOULD BE THAT IT CARVES OUT AN EXCEPTION FROM THE CHARITABLE PURPOSE OF ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY AND THAT EXCEPTION IS LIMITED TO ACTIVITIES IN THE NATURE OF TRADE, COMMERCE OR BUSINESS OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS FOR A CESS OR FEE OR ANY OTHER CONSIDERATION. IN BOTH THE ACTIVITIES, IN THE NATURE OF TRADE, COMMERCE OR BUSINESS OR THE ACTIVITY OF RENDERING ANY SERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS, THE DOMINANT AND THE PRIME OBJECTIVE HAS TO BE SEEN. IF THE DOMINANT AND PRIME OBJECTIVE OF THE INSTITUTION, WHICH CLAIMS TO HAVE BEEN ESTABLISHED FOR CHARITABLE PURPOSES, IS PROFIT MAKING, WHETHER I TS ACTIVITIES ARE DIRECTLY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS OR INDIRECTLY IN THE RENDERING OF ANY SERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS, THEN IT WOULD NOT BE ENTITLED TO CLAIM ITS OBJECT TO BE A 'CHARITABLE PURPOSE'. ON THE FLI P SIDE, WHERE AN INSTITUTION IS NOT DRIVEN PRIMARILY BY A DESIRE OR MOTIVE TO EARN PROFITS, BUT TO DO CHARITY THROUGH THE ADVANCEMENT OF AN 17 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) OBJECT OF GENERAL PUBLIC UTILITY, IT CANNOT BUT BE REGARDED AS AN INSTITUTION ESTABLISHED FOR CHARITABLE PURPOSES. THE HON'BLE DELHI HIGH COURT HAS CONSIDERED THE PROVISO TO SECTION 2(15) AND HELD THAT IF THE DOMINANT AND PRIME OBJECTIVE OF THE INSTITUTION , WHICH CLAIMS TO H A VE BEEN ESTABLISHED FOR CHARITABLE PURPOSES, IS PROFIT MAKING, WHETHER ITS ACTIVITIES ARE DIRE CTLY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS OR INDIRECTLY IN RENDERING OF ANY SERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS, THEN IT WOULD NOT BE ENTITLED TO CLAIM ITS OBJECT TO BE A CHARITABLE PURPOSE. ON THE FLIP SIDE, WHERE AN INSTITUT ION IS NOT DRIVEN PRIMARILY BY A DESIRE OR MOTIVE TO EARN PROFITS, BUT TO DO CHARITY THROUGH THE ADVANCEMENT OF AN OBJECT OF GENERAL PUBLIC UTILITY, IT CANNOT BUT BE REGARDED AS AN INSTITUTION ESTABLISHED CHARITABLE PURPOSES. IN THE PRESENT CASE, THE MAIN OBJECT OF THE ASSESSEE - ASSOCIATION FROM THE BEGINNING OF ITS INCEPTION IS ONLY TO DEVELOP THE GAME OF THE CRICKET THROUGHOUT THE STATE OF ANDHRA PRADESH BY ORGANISING TOURNAMENTS WHICH IS INTER - DISTRICT, INTER - ZONAL, INTER - SCHOOL AND INTER - ASSOCIATION MATCHES, TO EDUCATE YOUNG SPORTSMEN IN THE GAME AND TO REGULATE AND CONTROL THE GAME OF CRICKET AND ALSO TO IMPART TO PHYSICAL EDUCATION THROUGH THE MEDIUM OF CRICKET. WE FIND THAT THE ASSESS EE - ASSOCIATION ONLY EXISTED FOR THE PURPOSE TO DEVELOP THE GAME OF THE CRICKET IN THE 18 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) STATE OF ANDHRA PRADESH AND THEREFORE, THE MAIN CHARACTER OF THE ASSESSEE IS A CHARITABLE IN NATURE. SO FAR AS CONDUCTING INTERNATIONAL MATCHES ON BEHALF OF THE BCCI IS CONCERNED, IT IS SECONDARY OR INCIDENTAL TO ACHIEVE THE MAIN OBJECT. THEREFORE, IN OUR OPINION, THE DOMINANT OBJECT OF THE ASSESSEE IS TO ONLY DEVELOP THE GAME OF THE CRICKET AND NOT TO CARRY ANY BUSINESS ACTIVITY DIRECTLY OR INDIRECTLY IN THE ACTIVITIES RELATED TRADE, COMMERCE, BUSINESS. THEREFORE, ASSESSEE IS ENTITLED FOR CLAIM OF EXEMPTION UNDER SECTION 11 AND SECTION 10(23C)(IV) OF THE ACT . IN VIEW OF THE ABOVE, WE FIND NO REASON TO INTERFERE WITH THE ORDER PASSED BY THE LD. CIT(A). THUS, THIS APPEAL FILED BY THE REVENUE DESERVES TO BE DISMISSED AND IS DISMISSED ACCORDINGLY . ITA NO. 368 /VIZ/2018 (A.Y. 2015 - 16) 1 7 . THE GROUNDS RAISED BY THE DEPARTMENT ARE SIMILAR TO THE GROUNDS RAISED IN ITA NO. 279/VIZ/2018. THEREFORE, OUR DECISION IN ITA NO. 279/VIZ/2018 SHALL APPLY MUTATIS MUTANDIS TO THIS APPEAL ALSO. THUS, THIS APPEAL FILED BY THE REVENUE IS DISMISSED. ITA NO. 2 80 /VIZ/2018 (A.Y. 2014 - 15) 1 8 . THE ADDITIONAL GROUND RAISED IN THIS APPEAL IS EXTRACTED AS UNDER: - 12 . CIT(A) ERRED IN COMING TO A CONCLUSION THAT THE ACCUMULATED FUND OF RS. 4,52,37,665/ - WAS UTILIZED WITHIN THE SPECIFIC PERIOD BASING ON THE STATEMENT OF EXPENDITURE 19 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) SUBMITTED BY THE SOCIETY DURING APPELLATE PROCEEDINGS, WITHOUT CALLING FOR REMAND REPORT FROM THE AO ON THE ADDITIONAL EVIDENCE PRODUCED BY THE ASSESSEE SOCIETY BY WAY OF STATEMENT OF EXPENDITURE. 1 9 . THE ASSESSING OFFICER HAS NOTED THAT DURING THE FINANCIAL YEAR 2008 - 09, AN AMOUNT OF RS. 4,52,37,665/ - WAS ACCUMULATED UNDER SECTION 11(2) OF THE ACT FOR SPECIFIC PURPOSE AND THIS AMOUNT SHOULD HAVE BEEN SPENT BEFORE 31/03/2014 FOR THE PURPOSE FOR WHICH IT WAS ACCUMULATED. BUT AS PR ROI AND AS DISCUSSED IN THE ABOVE TABLE , THE ASSESSEE HAS SPENT AN AMOUNT OF RS. 1,88,46,317/ - AND THE BALANCE AMOUNT OF RS. 2,63,91,348/ - WAS NOT SPENT AS AT THE END OF 31/03/2014 . THEREFORE, AS PER THE APPROVAL GRANTED TO THE ASSESSEE UNDER SECTION 10(23C)(IV), THE ASSESSEE SH O ULD HAVE SPENT THE ENTIRE AMOUNT OF RS.4,52,37,6 65/ - BEFORE 31/03/2014, BUT NOT SPENT, IT AMOUNTS TO VIOLATION OF PROVISIONS OF 3 RD PROVISO TO SECTION 10(23C) OF THE ACT. AS PER SECTION 11(3)(C), ANY INCOME ACCUMULATED UNDER SECTION 11(2) IS NOT UTILIZED FOR THE PUR POSE FOR WHICH IT IS SO ACCUMULATED OR SET APART DURING THE PERIOD REFERRED TO IN CLAUSE (A) OF THAT SUB - SECTION OR IN THE YEAR IMMEDIATELY FOLLOWING THE EXPIRY THEREOF. THE CBDT HAS CLARIFIED VIDE CIRCULAR NO. 29, DATED 23/01/1969 THAT THE INCOME BECOMES CHARGEABLE TO TA X IN THE YEAR WHEN IT CEASES TO REMAIN ACCUMULATED AS SPECIFIED. 20 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) THEREFORE, THE BALANCE INCOME ACCUMULATED RS. 2,36,91,348/ - FOR THE ASSESSMENT YEAR 2009 - 10 RELEVANT TO THE PREVIOUS YEAR 2008 - 09 IS TAXABLE IN TH E ASSESSMENT YEAR 2014 - 15 . ACCORDINGLY, THE ASSESSING OFFICER HAS AD DED THE ACCUMULATED INCOME OF RS.2,36,91,348/ - TO THE TOTAL INCOME OF THE ASSESSEE. 20 . BEFORE THE LD. CIT(A), IT WAS SUBMITTED THAT ALL THE ACCUMULATED INCOME UTILIZED IN THE FINANCIAL YEAR 2011 - 12 AND 2012 - 13 AND FILED CHART BEFORE HIM. THE LD. CIT(A) GAVE A FINDING THAT THERE IS NO UNTILIZED ACCUMULATION OF FUNDS AND DIRECTED THE ASSESSING OFFICER TO DELETE THE ADDITION. FOR THE SAKE OF CONVENIENCE, THE RELEVANT PORTION OF THE ORDER IS EXTRACTED AS UNDER 7. 1 THE APPELLANT HAS PRODUCED A CHART SHOWING STATEMENT OF EXPENDITURE, ACCUMULATION U/S. 11 (2) FROM F.Y. 2007 - 08 TO 2014 - 15 WHICH IS REPRODUCED AS UNDER: FIN. YEAR ASST. YEAR TOTAL INCOME 85% OF TOTAL INCOME AFTER EXEMPTION OF 15% U/S 11(1) TOTAL EXPENDITURE AMOUNT EXPENDED OUT OF ACCUMULATION U/S 11(2) EXPENDITURE INCURRED FROM CURRENT YEAR INCOME SHORT FALL TO BE ACCUMULATED ACCUMULATED INCOME INVESTED IN APPROVED INVESTEMENTS U/S 11(2) BALANCE ACCUMULATION REMARKS 2007 - 08 2008 - 09 18,10,45,715 15,38,88,858 6,09,67,759 6,09,67,759 9,29,21,099 10,07,79,110 10,07,79,110 2008 - 09 2009 - 10 24,61,39,101 20,92,18,236 16,39,80,571 2,72,82,335 15,67,18,236 4,52,37,665 5,25,00,000 12,59,96,775 2009 - 10 2010 - 11 21,91,76,076 18,62,99,665 20,54,28,763 1,91,29,098 18,62,999,665 10,68,67,677 2010 - 11 2011 - 12 24,68,68,870 20,98,38,539 14,26,49,701 3,11,162 14,23,38,539 6,71,88,838 6,75,00,000 17,40,56,515 2011 - 12 2012 - 13 37,12,64,123 31,55,74,505 18,10,26,197 5,40,56,515 FINANCIAL YEAR 2007 - 08 ACCUMULATED INCOME COMPLETELY UTILISED 2011 - 12 1,54,41,060 11,15,28,622 13,45,48,308 22,47,90,642 32,93,49,582 2012 - 13 2013 - 14 29,43,29,724 25,01,80,266 30,24,74,315 3,70,58,940 FINANCIAL YEAR 2008 - 09 ACCUMULATED INCOME COMPLETELY UTILISED 2012 - 13 2013 - 14 2,33,33,382 24,20,81,993 26,89,57,260 2013 - 14 2014 - 15 46,75,32,396 39,74,02,537 41,62,48,853 1,93,30,813 39,69,18,040 24,96,26,447 2014 - 15 2015 - 16 33,56,05,927 28,52,65,038 42,31,02,466 2,48,35,805 FINANCIAL YEAR 2010 - 11 ACCUMULATED INCOME COMPLETELY UTILISED. 2014 - 15 2015 - 16 11,30,01,623 28,52,65,038 11,17,89,019 TOTAL RS. 33,37,80,783 33,98,95,910 44,55,69,752 21 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) 7.2 ON VERIFICATION OF THIS CHART IT IS NOTICED THAT ACCUMULATED FUNDS OF F.Y. 2008 - 09 ARE UTILISED IN THE F.Y. 2011 - 12 AND 2012 - 13 TO THE EXTENT OF RS.1,54,41,0601 - AND RS.3,70,58,940 / - RESPECTIVELY. THUS THERE IS NO UNUTILISED ACCUMULATION OF FUNDS. 7.3 FOR TIME BEING EVEN IF IT IS PRESUMED THAT TH ERE ARE UNUTILISED ACCUMULATION OF FUNDS RELATING TO F.Y. 2008 - 09, IT SHALL BE DEEMED TO BE THE INCOME OF THE PREVIOUS YEAR IMMEDIATELY FOLLOWING THE EXPIRY OF THE SPECIFIED PERIOD I.E. 5 YEARS U/S. 11(3). THUS IN THE PRESENT CASE THE ACCUMULATED FUNDS OF F.Y. 2008 - 09 SHALL BE DEEMED TO BE THE IN COME OF THE PREVIOUS YEAR I.E. F.Y. 2014 - 15 RELEVANT TO A.Y. 2015 - 16 BUT NOT IN THE A.Y. 2014 - 15 AS ASSESSING OFFICER ADDED. THE AO IS DIRECTED TO DELETE THE ADDITION. GROUND NO. 14 IS ALLOWED. 21 . BEFORE US, THE DEPARTMENTAL REPRESENTATIVE IS NOT ABLE TO POINT OUT ANY MISTAKE OR ERROR COMMITTED BY THE LD. CIT(A) FINDING IN RESPECT OF ACCUMULATION OF FUNDS . H OWEVER, LD. AR HAS POINTED OUT FROM PAPER BOOK AT PAGE NOS. 12 TO 15 THAT IN RESPECT OF ACCUMULATION OF PROFITS, A DETAILED SUBMISSION WAS MADE BEFORE THE COMMISSIONER (EXEMPTIONS) BY LETTER DATED 04/08/2017 , THE COMMISSIONER (EXEMPTIONS) , HYDERABAD HAS CONSIDERED THE SAME AND GAVE A CATEGORICAL FINDING AT PAGE NO. 21 OF THE PAPER BOOK THAT THERE IS NO VIOL ATION IN RESPECT OF ACCUMULATION OF F UNDS PERTAINING TO FINANCIAL YEAR 2007 - 08 AND 2008 - 09 FOR TREATING UNUTILIZED WITHIN THE SPECIFIED PERIOD OF FIVE YEARS. THEREFORE, THE ASSESSING OFFICER IS NOT CORRECT IN SAYING THAT THE FUNDS ARE NOT UTILIZED WITHIN THE PERIOD OF FIVE YEARS. WE FIND THAT THE LD. CIT(A) BY CONSIDERING THE DETAILED EXPLANATION GIVEN BY THE ASSESSEE FOR ACCUMULATION OF FUNDS FOR THE FINANCIAL YEAR S 2007 - 08 & 2008 - 09 22 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) AND UTILIZATION OF THE SAME AND GAVE A CATEGORICAL FINDING THAT THE ASSESSEE HAS NOT VIOLATED IN RESPECT OF ACCUMULATIONS MADE UNDER SECTION 11(2) OF THE ACT. THEREFORE, BY CONSIDERING THE ORDER OF THE LD. CIT(E) DATED 28/08/2017 AND ALSO LD. CIT(A) EXAM INING THE ACCUMULATIONS AND UTILIZATION OF FUNDS FOR THE FINANCIAL YEARS 2007 - 08 & 2008 - 09 GAVE A CATEGORICAL FINDING THAT THERE IS NO VIOLATION COMMITTED BY THE ASSESSEE, ALL FUNDS ARE UTILIZED IN TIME AS PER LAW. IN VIEW OF THE ABOVE, WE FIND NO REASON TO INTERFERE WITH THE ORDER PASSED BY THE LD. CIT(A). THUS, THIS GROUND OF APPEAL RAISED BY THE REVENUE IS DISMISSED. 2 2 . INSOFAR EXEMPTION CLAIMED BY THE ASSESSEE UNDER SECTION 11 AND 10(23C)(IV) OF THE ACT IS CONCERNED , THE FACTS ARE SIMILAR TO THE FACTS INVOLVED IN ITA NO. 279/VIZ/2018 . THEREFORE, OUR DECISION IN ITA NO. 279/VIZ/2018 SHALL APPLY MUTATIS MUTANDIS TO THIS APPEAL ALSO. THUS, THIS APPEAL FILED BY THE REVENUE IS DISMISSED. 2 3 . IN THE RESULT, ALL THE APPEAL S FILED BY THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON TH IS 18 TH DAY OF JAN . , 201 9 . SD/ - SD/ - ( D.S. SUNDER SINGH ) ( V. DURGA RAO ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 18 TH JAN . , 201 9 . 23 ITA NO S . 279, 280 & 368/VIZ/2018 ( M/S. ANDHRA CRICKET ASSOCIATION ) VR/ - COPY TO: 1. THE ASSESSEE M/S. ANDHRA CRICKET ASSOCIATION (ACA), 5 & 8, SWARNA RESIDENCY, ANNAPURNADEVI STREET, GANDHINAGAR, VIJAYAWADA. 2. THE REVENUE DCIT (EXEMPTIONS), VIJAYAWADA. 3. THE CIT (EXEMPTIONS), HYDERABAD. 4. THE CIT(A) , VIJAYAWADA. 5. THE D.R . , VISAKHAPATNAM. 6. GUARD FILE. BY ORDER (VUKKEM RAMBABU) SR. PRIVATE SECRETARY, ITAT, VISAKHAPATNAM.