DCIT (E) 2 (1), MUMBAI V. J.K.TRUST BOMBAY, MUMBAI

ITA 3085/MUM/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 3919 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-11-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2014-2015
• Appeal Filed On: 10-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A MOHAN
• Assessee Lawyers: RAKESH MOHAN
• Keywords: Gift; Charitable institution; Set aside
• Section: 143(3); 80G; 12A; 13; 263; 12; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH F MUMBAI BEFORE SHRI SAKTIJIT DEY (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 3085/MUM/2019 ASSESSMENT YEAR: 2014-15 DY. COMMISSIONER OF INCOME TAX (EXEMPTION)-2(1), ROOM NO. 519, 5 TH FLOOR, PIRAMAL CHAMBERS, LALBAUG, LOWER PAREL, MUMBAI-400012. VS. THE J.K. TRUST BOMBAY, GROUND FLOOR, NEW HIND HOUSE, NAROTTAM MORARJEE MARG, BELLARD ESTATE, MUMBAI-400001. PAN NO. AAATT0611L APPELLANT RESPONDENT REVENUE BY : MR. A. MOHAN, CIT-DR ASSESSEE BY : MR. RAKESH MOHAN, AR DATE OF HEARING : 02/11/2020 DATE OF PRONOUNCEMENT : 04/11/2020 ORDER PER N.K. PRADHAN, A.M. THIS IS AN APPEAL FILED BY THE REVENUE. THE RELEVAN T ASSESSMENT YEAR IS 2014-15. THE APPEAL IS DIRECTED AGAINST THE ORDER O F THE COMMISSIONER OF INCOME TAX (APPEALS)-5, MUMBAI [IN SHORT CIT(A)] AND ARISES OUT OF ASSESSMENT COMPLETED U/S 143(3) OF THE INCOME TAX A CT 1961, (THE ACT). 2. THE GROUNDS OF APPEAL FILED BY THE REVENUE READ AS UNDER : 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) IS RIGHT IN ALLOWING THE EXEMPTION U/S 11 OF THE I.T. ACT TO THE ASSESSES IN VIEW OF PROVISO TO SECTION 2(15) OF THE I.T. ACT, WHEN THE RECEIPTS FROM THE BUSINESS OF ITA NO. 3085/MUM/2019 THE J.K. TRUST BOMBAY 2 UPGRADING THE LOCAL INDIGENOUS LOW MILK YIELDING CA TTLE BY CROSS BREEDING THEM WITH THE USE OF FROZEN SEMEN OF HIGH PEDIGREE EXOTI C BULL THROUGH TECHNIQUE OF ARTIFICIAL INSEMINATION TO GET RESULTING BETTER MIL K YIELDER EXCEEDED THE LIMIT PROVIDED IN PROVISO TO SECTION 2(15), IGNORING THE DETAILED DISCUSSION MADE IN ASSESSMENT ORDER IN PARA 4. 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, WITHOUT PREJUDICE TO GROUND NO. 1 , THE LD. CIT(A) IS RIGHT IN ALLOWING THE EXEMPTION U/S 11 OF THE IT. ACT, IN VIEW OF PROVISO TO SECTION 2( 15) OF THE I.T. ACT, WHEN EVEN, AFTER IGNORING THE RECEIPTS OF MONEY /CONSIDERATION BEING INCOME FROM LIVESTOCK DEVELOPMENT CENTRES RECEIVED BY THE ASSES SES FOR THE ACTIVITIES CARRIED OUT BY IT ON THE BASIS OF PROPER CONTRACT/A GREEMENT ENTERED INTO WITH THE STATE /CENTRAL GOVERNMENT WHERE EVERYTHING HAS BEEN, DECIDED SPECIFICALLY IN PROPER BUSINESS/PROFESSIONAL MANNER EXCEEDING TH E LIMIT PROVIDED IN PROVISO TO SECTION 2(15) IGNORING THE DETAILED, DIS CUSSION MADE IN ASSESSMENT ORDER. 3. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) IS RIGHT IN DIRECTING THE AO TO ALLOW EXEMPTION U/S. 1 1 OF THE I.T. ACT IGNORING THE FACT THAT THE ASSESSES IS DOING REGULAR ACTIVITIES OF LIVE STOCK DEVELOPMENT CENTRE WHERE ACTIVITIES OF IMPREGNATION OF COWS AND BUFFALOS ARE CARRIED OUT AND SO THE ACTIVITIES ARE MORE IN THE NATURE OF COM MERCIAL ACTIVITIES. AT THE MOST THE ACTIVITIES CAN BE CONSIDERED AS CHARITABLE ACTI VITIES, IN NATURE OF GENERAL PUBLIC UTILITY. THEN ALSO THE PROVISO TO SECTION 2( 15) IS CLEARLY APPLICABLE AND THE ASSESSES IS NOT ENTITLED FOR EXEMPTION U/S. 11 OF THE I.T. ACT. 4. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) IS RIGHT IN RELYING ON THE DECISION OF THE TRIBUNAL WH ILE DECIDING THE ISSUE OF SETTING ASIDE THE ORDER U/S.263 OF THE I.T. ACT IN ASSESSEE'S OWN CASE FOR A.Y. 2012-13 IN ITA NO. 3769/MUM/2017, AFTER CONSIDERING THE ISSUE IN DEPTH AND THE SAID DECISION OF HON'BLE GUJRAT HIGH COURT IN T HE CASE OF SABARMATI ASHRAM GAUSHALA TRUST, WHEREIN THE SAME ISSUE OF APPLICABI LITY OF PROVISO TO SECTION 2(15) OF THE ACT HAS BEEN DECIDED IN ASSESSEE'S FAV OUR IGNORING THE FACT THAT THE ITA NO. 3085/MUM/2019 THE J.K. TRUST BOMBAY 3 DEPARTMENT HAS NOT ACCEPTED THE SAME DECISION AND H AS FILED FURTHER APPEAL BEFORE HON'BLE HIGH COURT WHICH IS PENDING OF ADJUD ICATION. 5. THE APPELLANT PRAYS THAT THE ORDER OF THE LD. CIT(A) BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR (AY) 2014-15 ON 2 9.09.2014 DECLARING TOTAL INCOME AT RS. NIL. THE ASSESSEE-TRUST IS REGISTERED AS A CHARITABLE ORGANIZATION WITH CIT(E), MUMBAI U/S 12A VIDE REGIS TRATION NO. BMY/TR/J(A)/9/73-74 DATED 19.03.1974 AND WITH CHARI TY COMMISSIONER VIDE REGISTRATION NO. E-717(BOM). THE ASSESSEE TRUS T IS REGISTERED U/S 80G OF THE I.T. ACT. THE ASSESSEE HAS ACCORDINGLY CLAIMED EXEMPTION U/S 11 OF THE I.T. ACT. IN THE ASSESSMENT ORDER DATED 26.12.2016, THE ASSE SSING OFFICER (AO) ARRIVED AT A FINDING (I) THAT THE OBJECT OF THE TRU ST IS GENERAL PUBLIC UTILITY AND 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, (II) IN THE PRESENT CASE, THE TRUST IS TAKING MONEY/CONSIDERATI ON FOR THE SAME FROM THE STATE/CENTRAL GOVERNMENT AND THAT CONSIDERATION IS NOT LUMP-SUM OR GRANT WHICH IS IN CASE OF SABARMATI ON WHICH THE ASSESSEE HAS RELIED UPON BUT THE SAME IS ON THE BASIS OF PROPER CONTRACT/AGREEMENT W HERE EVERYTHING HAS BEEN DECIDED SPECIFICALLY IN PROPER BUSINESS/PROFESSIONA L MANNER. THUS THE AO HELD THAT THE CASE OF THE ASSESSEE IS HIT BY THE AMENDMENT TO SECTION 2(15) OF THE ACT W.E.F. 01.04.2009 AND I T LOSES ITS CHARITABLE CHARACTER FOR THE ASSESSMENT YEAR IN QUESTION AND T HEREFORE IS NOT ENTITLED TO ITA NO. 3085/MUM/2019 THE J.K. TRUST BOMBAY 4 EXEMPTION U/S 11 IN VIEW OF THE PROVISION OF SECTIO N 13(8) OF THE ACT. ACCORDINGLY, THE AO CALCULATED THE TOTAL INCOME OF THE ASSESSEE AS UNDER : RS. INCOME FROM OTHER SOURCES 821228252 LESS : EXPENSES AMOUNT APPLIED TO CHARITABLE PURPOSE DURING PREVIOUS YEAR 708241507 TOTAL TAXABLE INCOME 112986745 ROUNDED OFF TO 112986740 4. AGGRIEVED BY THE ORDER OF THE, THE ASSESSEE FILE D AN APPEAL BEFORE THE LD. CIT(A). WE FIND THAT VIDE ORDER DATED 08.02.2019, THE LD. CIT(A), BY FOLLOWI NG THE DECISION IN CIT V. SRI BALAJI SAMAJ VIKAS SAMITI (91 TAXMANN.COM 26) (ALLAHABAD-HIGH COURT); DIT (EXEMPTION) V. SABARMATI ASHRAM GAUSHALA TRUST (44 TAXMANN.COM 141) (GUJARAT HIGH COURT) AND THE O RDER OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR AY 2012-13 IN ITA NO. 3769/ MUM/2017 HELD THAT THE AO WAS NOT JUSTIFIED IN HOLDING THAT THE ACTIVITIES OF THE ASSESSEE WERE IN THE NATURE OF CARRYING OUT BUSINESS OR TRADE AND HENCE HIT BY THE PROVISO TO SECTION 2(15) OF THE ACT. THUS THE LD. CIT(A) HELD THAT THE ASSESSEE IS ELIGIBLE FOR EXEMPTION U/S 11 & 12 OF THE ACT. 5. BEFORE US, THE LD. DEPARTMENTAL REPRESENTATIVE ( DR) RELIES ON THE ORDER OF THE AO. ON THE OTHER HAND, THE LD. COUNSEL FOR T HE ASSESSEE REFERS TO AND RELIES ON (I) ITAT ORDER DATED 15.07.2020 FOR AY 20 09-10 IN ASSESSEES OWN CASE, (II) ITAT ORDER DATED 15.07.2018 FOR AY 2012- 13 IN ASSESSEES OWN CASE, (III) THE DECISION IN SABARMATI ASHRAM GAUSHALA TRUST (SUPRA). ITA NO. 3085/MUM/2019 THE J.K. TRUST BOMBAY 5 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIALS ON RECORD. THE REASONS FOR OUR DECISIONS ARE GIVEN BELOW. WE FIND THAT SIMILAR ISSUE AROSE BEFORE THE ITAT F BENCH IN ASSESSEES OWN CASE FOR AY 2009-10 IN ITA NO. 1564 & 3084/MUM/ 2019. THE TRIBUNAL, REFERRING TO THE DECISION IN SABARMATI ASHRAM (SUPR A), HELD AS UNDER : 17. WITH REGARD TO THE REVENUE APPEAL, WE NOTICED THAT THE LD CIT(A) HAS ALLOWED THE GROUNDS RAISED BY THE ASSESSEE ON MERITS BY ACC EPTING THE SUBMISSIONS OF THE ASSESSEE AND CASES RELIED. THE DECISIONS SUBMITTED BEFORE HIM, ARE THE COORDINATE BENCH DECISIONS IN ASSESSEES OWN CASE AGAINST THE ORDER OF SECTION 263 OF THE ACT, IN WHICH THE COORDINATE BENCH HAS RELIED ON THE HONBL E GUJRAT HIGH COURT DECISION IN THE CASE OF SABARMATI ASHRAM (SUPRA). SINCE THE DEC ISION IN THE SABARMATI ASHRAM IS SIMILAR TO THE FACTS IN THE PRESENT CASE, WE ARE IN CLINED TO ACCEPT THE FINDINGS OF THE LD CIT(A) AND FOR THE BREVITY, THE RATIO IS REPRODU CED BELOW:- 9. MANY ACTIVITIES OF GENUINE CHARITABLE PURPOSES W HICH ARE NOT IN THE NATURE OF TRADE, COMMERCE OR BUSINESS MAY STILL GENERATE MARK ETABLE PRODUCTS. AFTER SETTING OFF OF THE COST, FOR PRODUCTION OF SUCH MAR KETABLE PRODUCTS FROM THE SALE CONSIDERATION, THE ACTIVITY MAY LEAVE A SURPLUS. TH E LAW DOES NOT EXPECT THE TRUST TO DISPOSE OF ITS PRODUCE AT ANY CONSIDERATIO N LESS THAN THE MARKET VALUE. IF THERE IS ANY SURPLUS GENERATED AT THE END OF THE YEAR, THAT BY ITSELF WOULD NOT BE THE SOLE CONSIDERATION FOR JUDGING WHETHER ANY A CTIVITY IS TRADE, COMMERCE OR BUSINESS - PARTICULARLY IF GENERATING 'SURPLUS' IS WHOLLY INCIDENTAL TO THE PRINCIPAL ACTIVITIES OF THE TRUST; WHICH IS OTHERWI SE FOR GENERAL PUBLIC UTILITY, AND THEREFORE, OF CHARITABLE NATURE. THE TRIBUNAL TOOK INTO ACCOUNT THE OBJECTS OF THE TRUST, WHICH ARE AS UNDER: ITA NO. 3085/MUM/2019 THE J.K. TRUST BOMBAY 6 '1. TO BREED THE CATTLE AND ENDEAVOUR TO IMPROVE THE QUALITY OF THE COWS AND OXEN IN VIEW OF THE NEED OF GOOD OXEN AS INDIA IS PROMINENT AGRICULTURAL COUNTRY AND THE COW MILK AS FOOD IS BO TH CONDUCIVE TO AND REQUISITE FOR GOOD HEALTH AND LONGEVITY OF HUMAN LI FE. IN ORDER TO IMPROVE THE QUALITY OF THE CATTLE, IT IS VERY ESSENTIAL TO USE A HIGH QUALITY BULLS. HENCE TO PRODUCE AND TO GET PRODUCED THE BEST PEDIG REED BULLS AND TO CASTRATE THE SCRUB BULLS AND PROPAGATE THE WORK TO PREPARE BULLOCKS BY CASTRATING THE BULLS WHICH DO NOT BECOME GOOD BULLS . 2. TO PRODUCE AND TO SELL THE COW MILK AND ITS VA RIOUS PREPARATIONS SO AS TO POPULARIZE THE USE OF COW MILK AND DO ALL OTHER WORKS FOR THE SAME. 3. TO HOLD AND CULTIVATE OR GET CULTIVATED AGRICU LTURAL LANDS, TO KEEP GRAZING LANDS ETC NECESSARY OR DESIRABLE FOR CATTLE KEEPING AND BREEDING OR TO REHABILITATE AND ASSIST RABARIS AND BHARWADS. 4. TO HOLD AND CULTIVATE OTHER LAND ALSO IN ORDER TO EXPERIMENT IN THE IMPROVEMENT IN AGRICULTURE AND OBTAIN FINANCE SUPPO RT IN ALL THE ACTIVITIES OF THE INSTITUTION. 5. TO MAKE NECESSARY ARRANGEMENTS FOR GETTING INF ORMATICS AND SCIENTIFIC KNOWLEDGE AND TO DO SCIENTIFIC RESEARCH WITH REGARD TO KEEPING AND BREEDING OF THE CATTLE, AGRICULTURE, USE OF MILK AN D ITS VARIOUS PREPARATIONS ETC AND TO ESTABLISH SCIENTIFIC LABORATORIES, LIBRA RIES, READING ROOMS RELATING TO THE KEEPING OF THE CATTLE, IMPROVEMENT OF AGRICULTURE ETC AND RECOGNIZE OR ASSIST SUCH INSTITUTIONS. 6. TO ESTABLISH OTHER ALLIED INSTITUTIONS LIKE LE ATHER WORK ETC AND TO RECOGNIZE AND HELP THEM IN ORDER TO MAKE THE COW KE EPING ECONOMICALLY VIABLE SUCCESSFULLY. ITA NO. 3085/MUM/2019 THE J.K. TRUST BOMBAY 7 7. TO PUBLISH BOOKS, PERIODICALS, MONTHLIES, ADVE RTISEMENTS, PAMPHLETS, STATEMENTS ETC FROM TIME TO TIME AND FOR THAT MATTE R TO ARRANGE FOR PRINTING PRESS, BUILDING ETC IN ORDER TO POPULARIZE THE OBJECTS OF THE TRUST. 8. TO ACCEPT ALL THE TRUSTS AND BENEFACTIONS NOT INIMICAL TO THE TRUST OBJECTS CONDITIONALLY OR OTHERWISE. 9. TO OPEN SCHOOLS AND HOSTELS FOR IMPARTING EDUC ATION IN COW KEEPING AND AGRICULTURE HAVING REGARD TO THE TRUST OBJECTS OR TO HELP SUCH SCHOOLS AND HOSTELS AND TO MAKE SUITABLE ARRANGEMENTS FOR T RAINING WORKERS REQUIRED FOR THE TRUST WORK. 10. TO GET THE MONEY FROM TIME TO TIME AS REQUIRE D FOR THE TRUST WORK BY WAY OF GIFT, BORROW ON SECURITIES OF THE TRUST PROP ERTIES OR OBTAIN IN ANY OTHER WAY AS DEEMED FIT BY THE TRUSTEES. 11. TO UNDERTAKE SUCH OTHER ACTIVITIES FROM TIME T O TIME FOR ACHIEVING OR HELPING THE TRUST OBJECTS AS DEEMED FIT BY THE TRUS TEES'. 10. THE TRIBUNAL ALSO NOTED THAT THE OBJECTS WERE A DMITTEDLY CHARITABLE IN NATURE. THE SURPLUS GENERATED WAS WHOLLY SECONDARY. IT WAS, THEREFORE, THAT THE TRIBUNAL HELD THAT THE PROVISO TO SECTION 2 (15) OF THE ACT WOULD NOT APPLY. 11. WE ARE WHOLLY IN AGREEMENT WITH THE VIEW OF THE TRI BUNAL. THE OBJECTS OF THE TRUST CLEARLY ESTABLISH THAT THE SAME WAS FOR GENER AL PUBLIC UTILITY AND WHERE FOR CHARITABLE PURPOSES. THE MAIN OBJECTIVES OF THE TRU ST ARE - TO BREED THE CATTLE AND ENDEAVOUR TO IMPROVE THE QUALITY OF THE COWS AN D OXEN IN VIEW OF THE NEED OF GOOD OXEN AS INDIA IS PROMINENT AGRICULTURAL COU NTRY; TO PRODUCE AND SALE THE COW MILK; TO HOLD AND CULTIVATE AGRICULTURAL LANDS; TO KEEP GRAZING LANDS FOR CATTLE KEEPING AND BREEDING; TO REHABILITATE AND AS SIST RABARIS AND BHARWADS; TO MAKE NECESSARY ARRANGEMENTS FOR GETTING INFORMATICS AND SCIENTIFIC KNOWLEDGE AND TO DO SCIENTIFIC RESEARCH WITH REGARD TO KEEPIN G AND BREEDING OF THE CATTLE, AGRICULTURE, USE OF MILK AND ITS VARIOUS PREPARATIO NS, ETC.; TO ESTABLISH OTHER ITA NO. 3085/MUM/2019 THE J.K. TRUST BOMBAY 8 ALLIED INSTITUTIONS LIKE LEATHER WORK AND TO RECOGN IZE AND HELP THEM IN ORDER TO MAKE THE COW KEEPING ECONOMICALLY VIABLE; TO PUBLIS H STUDY MATERIALS, BOOKS, PERIODICALS, MONTHLIES ETC., IN ORDER TO PUBLICIZE THE OBJECTS OF THE TRUST AS ALSO TO OPEN SCHOOLS AND HOSTELS FOR IMPARTING EDUCATION IN COW KEEPING AND AGRICULTURE HAVING REGARD TO THE TRUST OBJECTS. 12 . ALL THESE WERE THE OBJECTS OF THE GENERAL PUBLIC UT ILITY AND WOULD SQUARELY FALL UNDER SECTION 2 (15) OF THE ACT. PROFIT MAKING WAS NEITHER THE AIM NOR OBJECT OF THE TRUST. IT WAS NOT THE PRINCIPAL ACTIVITY. ME RELY BECAUSE WHILE CARRYING OUT THE ACTIVITIES FOR THE PURPOSE OF ACHIEVING THE OBJ ECTS OF THE TRUST, CERTAIN INCIDENTAL SURPLUSES WERE GENERATED, WOULD NOT REND ER THE ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS. AS CLARIFIED BY THE CBDT IN ITS CIRCULAR NO. 11/2008 DATED 19TH DECEMBER 2008 THE PROVISO AIMS T O ATTRACT THOSE ACTIVITIES WHICH ARE TRULY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS BUT ARE CARRIED OUT UNDER THE GUISE OF ACTIVITIES IN THE NATURE OF PUBL IC UTILITY'. 13. DELHI HIGH COURT IN CASE OF INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA V. DGIT [2012] 347 ITR 99/[20111.202 TAXMAN 1/13 TAXMA NN.COM 175 CONSIDERED THESE VERY PROVISIONS IN THE CONTEXT OF ACTIVITIES OF THE INSTITUTE OF CHARTERED ACCOUNTANTS HOLDING THAT THE FUNDAMENTAL OR DOMINANT FUNCTION OF THE INSTITUTE WAS TO EXERCISE OVERALL CONTROL AND R EGULATE THE ACTIVITIES OF THE MEMBERS/ENROLLED CHARTERED ACCOUNTANTS AND MERELY B ECAUSE THE INSTITUTE WAS HOLDING COACHING CLASSES WHICH ALSO GENERATE INCOME , THE COURT HELD THAT PROVISO TO SECTION 2 (.15) OF THE ACT WOULD NOT BE APPLICABLE. IT THUS HELD AND OBSERVED AS UNDER: 'SECTION 2 (15) DEFINES THE TERM 'CHARITABLE PURPOS E'. THEREFORE, WHILE CONSTRUING THE TERM 'BUSINESS' FOR THE SAID SECTION , THE OBJECT AND PURPOSE OF THE SECTION HAS TO BE KEPT IN MIND. WE DO NOT TH INK THAT A VERY BROAD AND EXTENDED DEFINITION OF THE TERM 'BUSINESS' IS I NTENDED FOR THE PURPOSE OF INTERPRETING AND APPLYING THE FIRST PROVISO TO S ECTION 2 (15) OF THE ACT TO INCLUDE ANY TRANSACTION FOR A FEE OR MONEY. AN ACTI VITY WOULD BE ITA NO. 3085/MUM/2019 THE J.K. TRUST BOMBAY 9 CONSIDERED 'BUSINESS' IF IT IS UNDERTAKEN WITH A PR OFIT MOTIVE, BUT IN SOME CASES THIS MAY NOT BE DETERMINATIVE. NORMALLY, THE PROFIT MOTIVE TEST SHOULD BE SATISFIED BUT IN A GIVEN CASE ACTIVITY MA Y BE REGARDED AS BUSINESS EVEN WHEN PROFIT MOTIVE CANNOT BE ESTABLISHED/PROVE D. IN SUCH CASES, THERE SHOULD BE EVIDENCE AND MATERIAL TO SHOW THAT THE ACTIVITY HAS CONTINUED ON SOUND AND RECOGNIZED BUSINESS PRINCIPL ES, AND PURSUED WITH REASONABLE CONTINUITY. THERE SHOULD BE FACTS AND OT HER CIRCUMSTANCES WHICH JUSTIFY AND SHOW THAT THE ACTIVITY UNDERTAKEN IS IN FACT IN THE NATURE OF BUSINESS. THE TEST AS PRESCRIBED IN STATE OF GUJ ARAT V. RAIPUR MANUFACTURING CO. [1967] 19 STC 1 (SC) AND CST V. S AI PUBLICATION FUND [2002] 258 ITR 70 (SC): [2002] 126 STC 288 (SC) CAN BE APPLIED. THE SIX INDICIA STIPULATED IN LORD FISHER [1981] STC 238 AR E ALSO RELEVANT. EACH CASE, THEREFORE, HAS TO BE EXAMINED ON ITS OWN FACT S. IN VIEW OF THE AFORESAID ENUNCIATION, THE REAL ISSU E AND QUESTION IS THAT WHETHER THE PETITIONER-INSTITUTE PURSUES THE ACTIVI TY OF BUSINESS, TRADE OR COMMERCE. TO OUR MIND, THE RESPONDENT WHILE DEALING WITH THE SAID QUESTION HAS NOT APPLIED THEIR MIND TO THE LEGAL PR INCIPLES ENUNCIATED ABOVE AND HAVE TAKEN A RATHER NARROW AND MYOPIC VIE W BY HOLDING THAT THE PETITIONER-INSTITUTE IS HOLDING COACHING CLASSE S AND THAT THIS AMOUNTS TO BUSINESS.' 14. IN THE RESULT, WE DO NOT FIND THAT THE TRIBUNA L HAS COMMITTED ANY ERROR AND THE TAX APPEAL IS THEREFORE DISMISSED. THEREFORE, RESPECTFULLY FOLLOWING THE ABOVE, GROUND RAISED BY THE REVENUE IS DISMISSED. 6.1 THE SPECIAL LEAVE PETITION FILED BY THE REVENUE AGAINST THE DECISION IN SABARMATI ASHRAM GAUSHALA TRUST (SUPRA) HAS SINCE BEEN DISMISSED BY THE HONBLE SUPREME COURT. ITA NO. 3085/MUM/2019 THE J.K. TRUST BOMBAY 10 7. FACTS BEING IDENTICAL, WE FOLLOW THE ABOVE ORDER OF THE CO-ORDINATE BENCH AND AFFIRM THE ORDER OF THE LD. CIT(A). 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 04/11/2020. SD/- SD/- ( SAKTIJIT DEY) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI; DATED: 04/11/2020 RAHUL SHARMA, SR. P.S. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI