M/S RAJASTHAN CRICEKT ASSOCIATION, Jaipur V. ADD. CIT, Jaipur

ITA 388/JPR/2012

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 9687 (ITAT-JAIPUR)
• Duration Of Justice: 4 year(s) 11 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 23-04-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: D S KOTHARI CIT DR DHK
• Assessee Lawyers: VIJAY GARG
• Keywords: Capital asset; Business income; Depreciation; Charitable institution; Opportunity of being heard; Principle of natural justice; Maximum Marginal Rate; Question of law; Benefit of exemption; Cancellation of registration
• Section: 143(3); 234B; 12A; 12AA; 147; 148; 144; 11

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH DQY HKKJR] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS [KK LNL; DS LE{K BEFORE: SHRI KUL BHARAT, JM & SHRI VIKRAM SINGH YAD AV, AM VK;DJ VIHY LA-@ ITA NO. 388/JP/2012 & 944/JP/2013 FU/KZKJ.K O'K Z@ ASSESSMENT YEARS : 2008-09 & 2009-10. M/S RAJASTHAN CRICKET ASSOCIATION, NORTH BLOCK, SMS STADIUM,AMBEDKAR CIRCLE, NEW VIDHAN SABHA, JAIPUR. CUKE VS. THE ADDITIONAL COMM ISSIONER OF INCOME TAX, RANGE-2(3) JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AAATR 0798 J VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VK;DJ VIHY LA-@ ITA NO. 921/JP/2013 FU/KZKJ.K O'K Z@ ASSESSMENT YEARS : 2009-10. THE ADDITIONAL COMM ISSIONER OF INCOME TAX, RANGE-2(3), JAIPUR. CUKE VS. M/S RAJASTHAN CRICKET ASSOCIATION, NORTH BLOCK, SMS STADIUM,AMBEDKAR CIRCLE, NEW VIDHAN SABHA, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AAATR 0798 J VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI O.P. AGGARWAL, SHRI MANISH AGGARWAL & SHRI VIJAY GARG (CA) JKTLO DH VKSJ LS@ REVENUE BY : SHRI D.S.KOTHARI CIT (DR) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 22.02.2017. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 23/03/2017. VKNS'K@ ORDER PER SHRI KUL BHARAT, JM. THIS BUNCH OF THREE APPEALS, TWO BY THE ASSESSEE I.E. 388/JP/2012 PERTAINING TO ASSESSMENT YEAR 2008-09 AND 944/JP/2013 , PERTAINING TO ASSESSMENT YEAR 2009-10 AND ONE BY THE REVENUE I.E 921/JP/2013 PERTAINING TO THE ASSESSMENT YEAR 2009-10 DIRECTED AGAINST THE DI FFERENT ORDERS OF THE LD. CIT (A) JAIPUR, DATED 15/2/2012 AND 30/9/2013 RESPECTIVELY. SINCE THE COMMON ISSUES ARE 2 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. INVOLVED IN THESE APPEALS. ALL THESE APPEALS WERE TAKEN UP TOGETHER AND ARE BEING DISPOSED OF BY WAY OF CONSOLIDATED ORDER FOR THE SA KE OF CONVENIENCE. FIRST WE TAKE UP THE ASSESSEES APPEAL IN ITA NO. 388/JP/2012 , PERTAINING TO THE ASSESSMENT YEAR 2008-09.THE ASSESEE HAS RAISED FOLL OWINGS GROUNDS OF APPEAL. 1. THE IMPUGNED ADDITIONS AND DISALLOWANCES MADE IN T HE ORDER U/S 143(3) DATED 29/12/2010 ARE BAD IN LAW AND ON ACTS OF THE CASE, OR WANT OF JURISDICTION AND VARIOUS OTHER REASONS AND HENCE TH E SAME KINDLY BE DELETED. 2. THE LD. CIT(A) ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN CONFIRMING THE DENIAL OF EXEMPTION U/S 11 OF THE AC T BY THE AO. SUCH DENIAL AND CONFIRMATION BEING TOTALLY CONTRARY TO T HE PROVISIONS OF LAW AND FACTS, THE EXEMPTION SO WITHDRAWN BE RESTORED BACK. 3. THE LD. AO ERRED IN LAW AS WELL AS ON THE ACTS OF T HE CASE IN RECORDING FINDINGS OF FACT WHICH ARE CONTRARY & PERVERSE TO T HE RECORD BY WRONGLY HOLDING THAT THERE WAS SUSTENTATIVE CHANGES MADE IN THE MAIN OBJECTS AND ALSO ERRED IN WRONGLY HOLDING THAT IT WAS MANDATORY ON THE PART O THE APPELLANT TO HAVE INTIMATED THE SAME TO THE REGISTE RING AUTHORITY AND FURTHER ERRED THEREBY, IN WITHDRAWING THE EXEMPTION U/S 11 OF THE ACT. SUCH FINDINGS AND CONCLUSION DESERVES TO BE QUASHED AND THE EXEMPTION SO WITHDRAWN BE RESTORED BACK. 4. THE LD. CIT(A) FURTHER ERRED IN LAW AS WELL AS ON T HE FACTS O THE CASE IN CONFIRMING THE TAXATION OF THE APPELLANT IN THE STA TUS O AOP WITHOUT ALLOWING EXEMPTIONS U/S11(1) AND 11(2) OF THE ACT A N COMPUTING THE INCOME THE UNDER NORMAL PROVISIONS OF THE ACT. SUC H ACTION BEING CONTRARY TO THE PROVISIONS OF LAW AND FACTS ON RECO RD, THE INCOME BE ASSESSED AT NIL. 5. THE AO & LD. CIT(A) FURTHER ERRED IN LAW AS WELL AS ON THE FACTS O THE CASE IN CHARGING TAX AT THE MAXIMUM MARGINAL RATE WHICH ALSO BEING CONTRARY TO THE PROVISIONS OF LAW HENCE BEING WITHOUT JURISDICT ION AND CONTRARY TO THE FACTS, SUCH TAXATION BE QUASHED. 6. 6,15,32,225/-: THE LD. CIT(A) FURTHER ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN CONFIRMING THE DISALLOWANCE OF THE EXPENSES INCURRED ON THE ACQUISITION OF THE CAPITAL ASSET, CLAIMED AS APPLICATION OF INCOME U/S 11 OF THE ACT. THE DISALLOWANCE SO MADE AND CO NFIRMED BEING CONTRARY TO THE PROVISION OF LAW AND FACTS ON RECOR D, BE DELETED ON FULL. 7. THE LD. CIT(A) FURTHER ERRED IN LAW AS WELL AS ON T HE FACTS OF THE CASE IN ALSO CONFIRMING THE DENIAL OF EXEMPTION U/S 11 OF T HE ACT ON THE OTHER GROUNDS BEING THE ACTIVITIES OF THE TRUST BEING RUN ON COMMERCIAL BASIS AND THERE BEING NO ELEMENT OF CHARITY. THE CONCLUS ION SO DRAWN AND THE DENIAL OF THE EXEMPTION U/S 11 OF THE ACT BEING CON TRARY TO THE PROVISION OF LAW AND FACTS, SUCH CONCLUSION BE REVERSED AND T HE EXEMPTION BE RESTORED. 3 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. 8. 4,07,58,505/-: THE LD. CIT(A) ERRED IN LAW AS WELL AS ON THE FAC TS O THE CASE IN CONFIRMING THE ASSESSMENT OF INCOME AT 4,0 7,58,505/- AS BUSINESS INCOME IN THE HANDS OF THE APPELLANT WHICH BEING CO MPLETELY CONTRARY TO THE PROVISIONS OF LAW AND FACTS BE DELETED IN FULL AND THE INCOME OF THE APPELLANT BE ASSESSED AT NIL. 9. THE LD. CIT(A) FURTHER ERRED IN LAW AS WELL AS ON T HE FACTS OF THE CASE IN CONFIRMING THE CHARGING INTEREST U/S 234D OF THE AC T. THE APPELLANT TOTALLY DENIES ITS LIABILITY OF CHARGING OF ANY SUCH INTERE ST. THE INTEREST SO CHARGED, BEING CONTRARY TO THE PROVISIONS OF LAW AN D FACTS, KINDLY BE DELETED IN FULL. 10. THE APPELLANT PRAYS YOUR HONOUR INDULGENCES TO ADD, AMEND OR ALTER O OR ANY OF THE GROUNDS OF THE APPEAL ON OR BEFORE THE D ATE OF HEARING. 2. BRIEFLY, STATED THE FACTS ARE THAT A RETURN DECL ARING TOTAL INCOME OF RS. NIL FOR THE ASSESSMENT YEAR 2008-09 WAS FILED BY THE ASSESS EE ON 29/9/2008. THEREAFTER, THE CASE WAS SELECTED FOR SCRUTINY AND WHILE FRAMIN G THE ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX ACT 1961,(HEREINAFTER REFE RRED TO AS THE ACT) THE ASSESSING OFFICER DENIED EXEMPTION CLAIMED UNDER SECTION 11 F OR WANT OF FRESH REGISTRATION , THEREBY THE ASSESSING OFFICER COMPUTED NET INCOME O F RS. 4,07,58,505/-. THE ASSESSING OFFICER TREATED THE GROSS RECEIPTS AS INC OME FROM BUSINESS. AGGRIEVED BY THIS, THE ASSESSEE PREFERRED AN APPEAL BEFORE LD. C IT(A), WHO AFTER CONSIDERING THE SUBMISSION PARTLY ALLOWED THE APPEAL. HOWEVER, HE SUSTAINED THE INCOME COMPUTED BY THE ASSESSING OFFICER AT RS. 4,07,58,505/-. 2. AGGRIEVED BY THIS THE ASSESSEE IS IN FURTHER APP EAL BEFORE THIS TRIBUNAL. AT THE TIME, THE LD. COUNSEL FOR THE ASSESSEE STATED T HAT HE DOES NOT WISH TO PRESS GROUND NO. 1. THE LD. CIT(DR) HAS NO OBJECTION. T HE GROUND NO. 1 OF THE ASSESSEES APPEAL IS DISMISSED AS NOT PRESSED. 4 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. 3. GROUND NOS. 2 TO 8 ARE AGAINST DENIAL OF EXEMPTI ONS AND COMPUTATION OF INCOME AS BUSINESS INCOME SINCE THE GROUND NOS. 2 T O 8 INTER-RELATED ARE TAKEN UP TOGETHER FOR THE DISPOSAL. THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUB MISSIONS AS MADE IN THE WRITTEN SUBMISSIONS. THE SUBMISSIONS OF THE LD. COUNSEL FO R THE ASSESSEE ARE REPRODUCED AS UNDER: BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS AN ASS OCIATION REGISTERED UNDER RAJASTHAN SPORTS (REGISTRATION, RECOGNITION AND REGULATION OF ASSOCI ATION) ACT, 2005 AND FORMED WITH THE OBJECTIVE OF PROMOTING THE SPORT OF CRICKET WITHIN THE STATE OF RAJASTHAN. RCA, UNDER A MEMORANDUM OF UNDERSTANDING WITH RAJASTHAN STATE COUNCIL HAS EXCL USIVE USE AND POSSESSION OF SAWAI MANSINGH STADIUM FOR THE PURPOSES OF ORGANIZING NATIONAL AND INTERNATIONAL CRICKET MATCHES. THE MAIN OBJECT OF THE ASSOCIATION IS TO CONTROL, SUPERVISE, REGULA TE OR ENCOURAGE, PROMOTE AND DEVELOP THE GAME OF CRICKET IN THE AREAS UNDER THE JURISDICTION OF ASSO CIATION ON NO PROFIT NO LOSS BASIS. ASSESSEE WAS HOLDING REGISTRATION U/S 12A W.E.F. 25.11.1988 AND THUS WAS CLAIMING EXEMPTION U/S 11. FOR THE YEAR RELEVANT TO APPEAL, ASSESSEE FILED RETURN OF INCOME ON 29.09.2008 DECLARING TOTAL INCOME AT NIL. CASE GOT SELECTED FOR SCRUTINY AND LD. AO COMPLETED THE ASSESSMENT U/S 143(3) WITHDRAWING EXEMPTION U/S11 FOR THE REASON THAT HE OBSERVED CERTAIN AMEND MENTS WERE CARRIED OUT IN MEMORANDUM OF ASSOCIATION AND RULES OF ASSESSEE ASSOCIATION IN F. Y.1998-99 & LATER IN 2004-05, WHICH WERE NOT INTIMATED TO LD. CIT, THUS, REGISTRATION GRANTED ON THE BASIS OF MEMORANDUM AND RULES AS THEY STOOD PRIOR TO AMENDMENT, DESERVED TO BE CANCELLED. ON TH E BASIS OF INFORMATION OF LD. AO, LD. CIT WITHDREW REGISTRATION U/S 12A OF THE INCOME TAX ACT , 1961 TO THE ASSESSEE FROM A.Y. 2005-06 AND ONWARDS. ALSO, LD. AO OBSERVED THAT ASSESSEE HAD EA RNED SUBSTANTIAL INCOME IN THE SHAPE OF SUBSIDY FROM BCCI, ADVERTISEMENT INCOME, MEMBERSHIP FEES ET C. AND CONCLUDED THAT SINCE ASSESSEE WAS EARNING HUGE SURPLUS, THE SAME WAS NOT IN THE NATUR E OF CHARITABLE PURPOSE AND RATHER IN THE NATURE OF BUSINESS. ACCORDINGLY, ASSESSMENT WAS COMPLETED BY LD. AO BY WITHDRAWING EXEMPTION U/S 11 AND THEREBY COMPUTING THE TOTAL INCOME OF ASSOCIATION AT RS. 4, 07,58,510/- CONSIDERING THE SAME AS AOP. AN APPEAL WAS FILED BEFORE LD. CIT(A) AGAINST ASSES SMENT ORDER, WHICH WAS DECIDED VIDE ORDER DATED 15.02.2012, UPHOLDING THE ORDER OF AO WITH RESPECT OF DENIAL OF EXEMPTION U/S 11,HOWEVER ISSUE 5 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. WITH RESPECT TO REGISTRATION U/S 12A WAS NOT ADJUDI CATED BY LD. CIT(A) AS THE MATTER OF WITHDRAWAL OF EXEMPTION WAS PENDING BEFORE ITAT. APPEAL FILED BEFORE HONBLE ITAT AGAINST ORDER OF L D. CIT CANCELLING REGISTRATION, WAS DECIDED VIDE ORDER DATED 13.07.2012 IN ITA NO. 69/JP/2011, SETTI NG ASIDE THE ORDER WITHDRAWING REGISTRATION AND DIRECTING CIT TO DECIDE MATTER AFRESH. LD. CIT, VIDE ORDER 28.03.2013 AGAIN WITHDREW REGIS TRATION U/S 12A PRIMARILY RELYING UPON OBSERVATIONS OF AO. ASSESSEE FILED APPEAL AGAINST O RDER OF CIT, WHICH WAS DECIDED BY HONBLE ITAT VIDE ORDER DATED 09.06.2016. VIDE SAID ORDER, HONB LE ITAT AT PAGE 16 PARA 5, DECIDED THE APPEAL IN FAVOUR OF ASSESSEE BY OBSERVING AS UNDER: WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PAR TIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IT IS UNDISPUTED FACT THAT THE ASSESSEE WAS GRANTED REGISTRATION U/S 12A ON 25.11.1988, WHICH HAS BEEN WITHDRAWN TWICE BY THE L D. CIT. THE ISSUE HAS BEEN SET ASIDE BY THE COORDINATE BENCH TO RECONSIDER THE WITHDRAWN OF REG ISTRATION, WHICH WAS ALSO CHALLENGED BY THE REVENUE BEFORE THE HONBLE RAJASTHAN HIGH COURT, WH O HAS ALLOWED THE ASSESSEES PRAYER AND DIRECTED TO CONSIDER THE APPLICATION AFRESH WITHOUT INFLUENCING ANY OF THE OBSERVATION MADE BY THE APPELLATE AUTHORITY. THE ASSESSEE HAS BEEN PROV IDED REASONABLE OPPORTUNITY OF BEING HEARD BY THE LD. CIT. THE ASSESSEE TRUST MADE IT CLEAR TH AT THIS AMENDMENT IN OBJECT OF MEMORANDUM IN 2005 WAS DUE TO CHANGE MADE IN THE RAJASTHAN SPORTS (REGISTRATION, RECOGNITION AND REGULATION OF ASSOCIATION) ACT, 2005. THE AMENDED OBJECTS WERE NOT VOLUNTARY CHANGE. THE ASSESSEE HAS TO FOLLOW THE SAID LAWS RELATED TO SPORTS ACTIVITIES. THE COMPARISON GIVEN BY THE LD. CIT IN HIS ORDER DATED 28.03.2013 DOES NOT SHOW ANY FUNDAMENTAL DEVI ATION FROM THE ORIGINAL CHARITABLE ACTIVITIES TO NON-CHARITABLE ACTIVITIES. THE ASSESS EES OBJECT TO PROMOTE THE CRICKET IN STATE BY PROVIDING / INVOLVING VARIOUS ACTIVITIES AT THE DIS TRICT LEVEL TO STATE LEVEL THROUGH COACHING PROVIDED BY COACHES, GROUND AND FACILITIES ETC. THE REFORE, THE ASSESSEES ACTIVITIES ARE CHARITABLE. THE OTHER ACTIVITIES ARE INCIDENTAL OR CONDUCTIVE OF THE MAIN ACTIVITY. THE CASE LAWS REFERRED BY THE ASSESSEE PARTICULARLY THE HONBLE D ELHI HIGH COURT DECISION IN THE CASE OF MOOL CHAND KHAIRATI TRUST (SUPRA) IS SQUARELY APPLICABLE AS THE ASSESSEE AMENDED THE PROVISIONS, DOES NOT CHANGE THE CHARACTER OF THE ASSESSEE FROM CHARI TABLE TO NON-CHARITABLE OR COMMERCIAL. AT THE TIME OF REGISTRATION, THE LD. CIT HAS TO CONSID ER SECTION 12AA(3) AND HE HAS TO CONSIDER TWO CONDITIONS FOR REJECTION OF REGISTRATION GRANTED (I ) THE ACTIVITIES OF THE TRUST ARE NOT GENUINE, (II) ARE NOT BEING CARRIED OUT IN ACCORDANCE WITH THE OB JECT OF THE TRUST AS THE CASE MAY BE. THE LD. CIT HAS NOT FOUND ANY INFIRMITY IN THE ACTIVITIES C ARRIED OUT BY THE RCA AS NON-GENUINE OR NOT BEING CARRIED OUT AS PER OBJECT OF THE TRUST. IT IS ALSO A FACT THAT THE GAME OF CRICKET BECOME VERY POTENTIAL WITH REFERENCE TO REVENUE COMPARED T O OTHER GAMES, THEREFORE, THE REVENUE GENERATED BY THE RCA ARE SUBSTANTIAL BUT THIS GROU ND CANNOT BE USED TO CANCEL THE REGISTRATION GRANTED BY THE LD. CIT AS PREDOMINANT OBJECT OF THE TRUST IS CHARITABLE AND SUBSTANTIAL REVENUE GENERATED IS INCIDENTAL TO THE MAIN OBJECT. IF, THE LD. ASSESSING OFFICER FOUND ANY VIOLATION IN APPLICATION OF FUND, HE CAN MAKE DISALLOWANCE U/S 11 OF THE ACT. THUS, WE 6 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. ARE OF THE CONSIDERED VIEW THAT THE LD. CIT WAS NOT RIGHT IN WITHDRAWING THE REGISTRATION GRANTED U/S 12A OF THE ACT. ACCORDINGLY, THE ASSESSEES APP EAL IS ALLOWED. IN VIEW OF ABOVE, IT IS SUBMITTED THAT NOW SINCE TH E REGISTRATION GRANTED U/S 12A HAS BEEN RESTORED PURSUANT TO ORDER DATED 09.07.2016 PASSED BY HONBL E ITAT IN ITA NO. 544/JP82013 ( APB 13-30) , ASSESSEE IS ELIGIBLE TO CLAIM EXEMPTION U/S 11 SUBJ ECT TO THE FULFILLMENT OF CONDITIONS PRESCRIBED THEREIN AND FURTHER IF THERE IS NO VIOLATION TO SEC TION 13. ASSESSEES GROUND OF APPEAL NO. 1: NOT PRESSED. ASSESSEES GROUND OF APPEAL NO. 2 TO 5 & 7: IN GROUNDS OF APPEAL NO.2 TO 5, ASSESSEE HAS CHALLE NGED THE ACTION OF LD. CIT(A) IN CONFIRMING THE ACTION OF LD. AO IN DENYING EXEMPTION U/S 11 AND AS SESSING THE ASSESSEE IN THE STATUS OF AOP BY APPLYING MAXIMUM MARGINAL RATE WHEREAS IN GROUND OF APPEAL NO.7 ASSESSEE HAS CHALLENGED THE ACTION OF AO IN DENYING EXEMPTION ON THE ALLEGATION THAT ACTIVITIES OF ASSESSEE ARE BEING RUN ON COMMERCIAL BASIS. ALL THE GROUNDS BEING RELATED ARE BEING DEALT HEREWITH TOGETHER FOR THE SAKE OF CONVENIENCE: IN THIS REGARD, AT THE OUTSET IT IS SUBMITTED THAT ALL THE GROUNDS OF APPEAL RELATE TO DENIAL OF EXEMPTION U/S 11. FURTHER, FOR CLAIMING EXEMPTION U /S 11, PRE CONDITIONS ARE THAT: (I) ASSESSEE HOLDS A VALID REGISTRATION U/S 12A (II) INCOME IS APPLIED IN ACCORDANCE WITH THE PROVISIONS OF SECTION11 AND (III) THERE IS NO VIOLATION IN TERMS WITH SECTION 13. IN THE INSTANT CASE, SO FAR AS REGISTRATION U/S 12A IS CONCERNED, THE SAME IS RESTORED BY HONBLE ITAT , THUS ASSESSEE CAN CLAIM EXEMPTION U/S 11 SUBJECT TO THE FULFILLMENT OF CONDITIONS PRESCRIBED U/S 11 R.W.S.13. SECTION 11 OF THE INCOME TAX ACT PROVIDES EXEMPTION IN RESPECT OF INCOME OF CHARITABLE OR RELIGIOUS TRUSTS IF THE SAME IS APPLIED TOWARDS THE OBJECTS O F THE TRUSTS. A SUMMARY OF PROVISIONS OF SECTION 11 IS AS UNDER: 7 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. (I) IF INCOME IS APPLIED TO CHARITABLE/ RELIGIOUS PUR POSES IN INDIA (11(1)(A) &11(1)(B): TO THE EXTENT IT IS ACTUALLY APPLIED TO SUCH PURPOSES DURING THE FINANCIAL YEAR. EVEN COURTS HAVE HELD THAT IF THE EXPENDITURE IS ON CAPITAL ACCOUNT ON OBJECT(S) CONT AINED IN THE OBJECT CLAUSE, THE EXPENDITURE WILL AMOUNT TO APPLICATION OF INCOME. FURTHER, TO BE ELI GIBLE TO CLAIM EXEMPTION, AT LEAST 85 % OF INCOME HAS TO APPLIED TOWARDS CHARITABLE/ RELIGIOUS PURPOS ES, HOWEVER CERTAIN RELAXATIONS ARE PROVIDED IN THE ACT. (II) INCOME APPLIED OUTSIDE INDIA 11(1)(C): IS EXEMPT PROVIDED SUCH APPLICATION OF INCOME PROM OTES INTERNATIONAL WELFARE IN WHICH INDIA IS INTERESTED SUBJECT TO PRIOR APPROVAL OF BOARD. (III) CORPUS DONATION 11(1)(D): I.E. VOLUNTARY CONTRIBUTIONS RECEIVED WITH SPECIFI C DIRECTION FROM THE DONOR THAT THEY SHALL FORM PART OF CORPUS. (IV) CAPITAL GAINS 11(1A): WILL BE DEEMED TO HAVE BEEN APPLIED TO CHARITABLE PURPOSES AND WILL BE EXEMPT TO THE EXTENT THEY ARE REINVESTED IN A NEW CAPITAL ASSET. (V) INCOME ACCUMULATED OR SET APART FOR APPLICATION: TO THE EXTENT OF 15% OF INCOME DERIVED DURING THE YEAR. SECTION 11(2): PERMITS ACCUMULATION OF INCOME IN ADDITION TO 15% AS STATED ABOVE, FOR SPECIFIC PURPOSE (S). SUCH ACCUMULATION OR SETTING APART HAS TO BE FOR DEFINITE AND CONCRETE PURPOSES AND SHOULD NOT BE VAGUE. SECTION 11(3) PROVIDES CIRCUMSTANCES UNDER WHICH INCOME SET APAR T TO BE APPLIED IN FUTURE, I.E. SET APART U/S 11(2) SHALL BE DEEMED TO BE INCOME OF ASSESSEE, WHICH ARE PRIMARILY: (I) SUMS APPLIED FOR PURPOSES OTHER THAN CHARITABLE OR RELIGIOUS PURPOSES (II) CEASES TO REMAIN INVESTED IN THE MODES SPECIFIED U/ S 11(5) (III) NOT UTILIZED FOR THE PURPOSE FOR WHICH IT WAS ACCUM ULATED OR SET APART (IV) IS CREDITED OR PAID TO ANY TRUST OR INSTITUTION REG ISTERED U/S12AA OR TO ANY FUND OR INSTITUTION OR TR UST OR ANY UNIVERSITY OR OTHER EDUCATION INSTITUTION OR HO SPITAL; OR OTHER MEDICAL INSTITUTION REFERRED TO IN SUB CLAUSE (IV) OR SUB CLAUSE (V) OR SUB CLAUSE(VI) OR SUB CLAUSE(VIA) OF CLAUSE (23C) OF SECTION 10. FURTHER, SECTION 13 PROVIDES CERTAIN CIRCUMSTANCES UNDER WHICH SECTION 11 IS NOT APPLICA BLE . THESE ARE: (I) ANY PART OF INCOME FROM PROPERTY HELD UNDER TRUST F OR PRIVATE RELIGIOUS PURPOSES , WHICH DOES NOT RESU LT INTO BENEFIT OF THE PUBLIC. (II) ANY INCOME OF TRUST OR INSTITUTION CREATED OR ESTAB LISHED FOR THE BENEFIT OF ANY PARTICULAR RELIGIOUS COMMUNITY OR CASTE. 8 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. (III) IF ANY PART OF INCOME DIRECTLY/ INDIRECTLY BENEFITS AUTHOR/ FOUNDER/ TRUSTEE/ MANAGER OR SUCH OTHER PE RSON SPECIFIED U/S 13(3) (IV) FUNDS REMAIN INVESTED IN MODES OTHER THAN 11(5) (V) INCOME OF CHARITABLE INSTITUTION ENGAGED IN THE ADV ANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY IF IT INVOLVES CARRYING ON OF ANY TRADE, C OMMERCE OR BUSINESS ACTIVITY. APART FROM ABOVE, THE MOST RELEVANT PROVISION IS SE CTION 2(15), WHEREIN THE WORD CHARITABLE PURPOSE IS DEFINED AS TO INCLUDE: ( A) RELIEF OF THE POOR, (B) EDUCATION, (C) MEDICAL RELIEF, AND (D) ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBL IC UTILITY. HOWEVER, WITH EFFECT FROM 01.04.2009 (I.E., FROM AS SESSMENT YEAR 2009-10 ONWARDS), SECTION 2(15) HAS BEEN AMENDED TO THE EXTENT THAT, THE ADVANCEME NT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY SHALL NOT QUALIFY AS A CHARITABLE PURPOSE IF THE SAME INVOLVES THE CARRYING ON OF ANY ACTIV ITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS, OR RE NDERING OF ANY SERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS, FOR A CONSIDERATION. NOW COMING TO THE MERITS OF THE CASE, AT THE OUTSET , BRIEF BACKGROUND OF ASSESSEE ASSOCIATION IS SUBMITTED AS UNDER: RAJASTHAN CRICKET ASSOCIATION (RCA) IS DULY REGISTE RED UNDER THE PROVISION OF RAJASTHAN SPORTS (REGISTRATION, RECOGNITION AND REGULATION OF ASSOCI ATION) ACT, 2005. THE ASSOCIATION WAS FORMED SOLELY WITH THE OBJECTIVE OF PROMOTING THE SPORT OF CRICKET WITHIN THE STATE OF RAJASTHAN. THE STATE GOVERNMENT THROUGH THIS LAW REGULATES, RECOGNIZES A ND FACILITATES SPORT ACTIVITIES IN THE STATE. RAJASTHAN SPORTS (REGISTRATION, RECOGNITION AND REG ULATION OF ASSOCIATION) RULES, 2004, VIDE RULE 6(1) NECESSARILY REQUIRED THE EXISTING SPORT ASSOCIATION S TO AMEND THEIR CONSTITUTION TO BRING THE SAME IN CONFORMITY WITH THE ORDINANCE (ACT). A REGISTRATION UNDER THE ACT WAS ALSO MADE MANDATORY AND ACCORDINGLY, RCA WAS ALSO GRANTED REGISTRATION VIDE REGISTRAR CO-OPERATIVE SOCIETIES DATED 27.04.2005 AT KRI. SAN. / RAJYA / 020/2005 (APB 75-75A). STRINGENT PROVISIONS FOR ENQUIRY AND WITHDRAWAL OF REGISTRATION ARE AVAILABLE IN THE ACT . THUS, THE SPORT ASSOCIATIONS INCLUDING THE RCA ARE UNDER DIRECT CONTROL AND SUPERVISION OF THE REGISTR AR UNDER THIS ACT. 9 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. THUS, BEING ENGAGED IN THE PROMOTION OF SPORT OF CR ICKET, ASSESSEE IS CARRYING ON CHARITABLE ACTIVITY IN THE NATURE OF ADVANCEMENT OF ANY OTHER OBJECT OF G ENERAL PUBLIC UTILITY AND WAS CLAIMING AND BEING ALLOWED EXEMPTION UNDER SAID CATEGORY. HOWEVER, FOR THE YEAR UNDER CONSIDERATION, LD. AO HAS DENIED EXEMPTION HOLDING THAT ACTIVITIES ARE BEING CARRIED ON COMMERCIAL BASIS. IN THIS REGARD, AT THE OUTSET, IT IS HUMBLY SUBMITT ED THAT THE AMENDMENT IN SECTION 2(15), PURSUANT TO WHICH AO HAS WITHDRAWN STATUS OF ASSESSEE AS CH ARITABLE WAS CARRIED OUT VIDE FINANCE ACT,2010, W.R.E.F.1.04.2009, THUS SAID PROVISIONS WOULD NOT A PPLY IN THE YEAR UNDER CONSIDERATION. IN OTHER WORDS, PRIOR TO AMENDMENT, EXEMPTION UNDER SECTION 11 WAS ELIGIBLE IN RESPECT OF CHARITABLE INSTITUTIONS ENGAGED IN ADVANCEMENT OF ANY OTHER O BJECT OF GENERAL PUBLIC UTILITY EVEN IF ACTIVITIES RESULT INTO PROFITS INCIDENTALLY PROVIDED THAT SUCH INCOME IS APPLIED IN ACCORDANCE WITH THE PROVISION S OF SECTION11. FURTHER, THERE NO ALLEGATION REGARDIN G VIOLATION AS PER SECTION13, THUS WITHDRAWAL OF EXEMPTION ON THE GROUNDS OF COMMERCIALITY FOR THE Y EAR UNDER CONSIDERATION IS BAD IN LAW. IT IS THUS PRAYED THAT EXEMPTION CLAIMED BY ASSESSEE MAY PLEAS E BE ALLOWED. HOWEVER, WITHOUT PREJUDICE TO THIS, OUR SUBMISSION ON MERITS IS AS UNDER: LD. AO BY OBSERVING HUGE SURPLUS CONCLUDED THAT ACT IVITIES OF THE ASSESSEE WERE PROFIT ORIENTED AND ASSESSEE WAS CARRYING ITS ACTIVITIES ON COMMERCIAL BASIS. IT IS NOTEWORTHY HERE THAT THE TERM ANY OTHER ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS IS NOT DEFINED AND THUS THE SAME HAS TO BE UNDERSTOOD IN COMMON PARLANCE, AND ACCORDINGLY E XPRESSION TRADE, COMMERCE OR BUSINESS HAS TO BE UNDERSTOOD AS A REGULAR AND SYSTEMATIC ACTIVITY WITH THE PRIMARY MOTIVE TO EARN PROFIT, WHEREAS THE ASSOCIATION NEVER ACTED AS A PROFESSIONAL ADVERTISER, TV PRODUCER ETC. NO MATCHES OF ANY GAME OTHER THAN CRICKET OR NO OTHER EVENTS ARE ORGANIZED TO ATTRACT AUDIENCE RATHER ONLY CRICKET MATCHES ARE BEING ORGANIZED WHETHER THE SAME RESULT INTO PROFIT OR LOSS. FURTHER, ALL THE CRICKET MATCHES DO NOT ATTRACT AUDIENCE, E.G. MATCHES BETWEEN INDIA V/ S SOUTH AFRICA AND INDIA V/S NEW-ZEALAND COULD NOT EVEN REACH UPTO 70-80% OF THE COLLECTION. HOWEV ER, DURING THE YEAR UNDER CONSIDERATION, ASSESSEE ORGANIZED ODI MATCH BETWEEN INDIA VS PAKIS TAN FROM WHICH SUBSTANTIAL SURPLUS WAS EARNED. YOUR HONOURS WOULD APPRECIATE THE POPULARITY OF IND IA PAKISTAN MATCHES. HONBLE MADRAS HIGH COURT IN THE CASE OF TAMILNADU CRICKET ASSOCIATION HAS HELD THAT VOLUME SHOULD NOT BE THE SOLE CONSIDERATION TO DECIDE THE ACTIVITY OF THE SOCIETY RATHER THE NATURE OF ACTIVITY VIS A VIS THE PREDOMINANT OBJECT IS TO BE SEEN WHICH IN OUR CASE IS CHARITABLE IN NATURE. FURTHER, BEING REGISTERED UNDER RAJASTHAN SPORTS ( REGISTRATION, RECOGNITION AND REGULATION OF ASSOCIATION) ACT, 2005, ASSESSEE IS AUTHORIZED AS W ELL AS WELL EQUIPPED FOR ORGANIZING ALL THE CRICKET MATCHES TAKING PLACE IN THE STATE OF RAJASTHAN. 10 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. AT THIS JUNCTURE, IT WOULD BE PERTINENT TO STATE TH AT ALL THE PAYMENTS IN THE SHAPE OF SPONSORSHIP, ADVERTISEMENT, T.V. RIGHTS ETC. ARE RECEIVED DIRECT LY BY BCCI. FURTHER, BCCI DELEGATES THE ORGANIZATIO N OF MATCHES TO STATE ASSOCIATION AND IN TURN STATE A SSOCIATION GETS SOME FUNDS FOR PROMOTION AND EXPANSION OF THEIR CHARITABLE ACTIVITIES. APART FROM THIS, MAJOR BENEFIT BY ORGANIZING THESE MATCHES IS THAT LOCAL TEAMS, BEING TRAINED BY RCA, GET OPPORTUNITY TO LEARN FROM EXPERIENCE OF COACHES OF INTERNATIONAL LEVEL BY ASSISTING THEM DURING PRACTICE MATCHES AND BY WITNESSING THE MATCHES PLAY ED BY INTERNATIONAL PLAYERS, BY SPENDING TIME WITH THEM ETC. YOUR HONOURS WOULD APPRECIATE THAT I T IS NOT POSSIBLE TO TAKE THE ENTIRE TEAM TO LOCATIONS WHERE MATCHES ARE BEING PLAYED. SO, ULTIM ATELY, ORGNISING SUCH MATCHES RESULTS INTO PROMOTION OF SPORT OF CRICKET AND SURPLUS IF ANY GE NERATED, IS PURELY INCIDENTAL IN NATURE AND ASSESSEE CANNOT BE DEEMED TO CARRY OUT ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS. ALSO, ASSOCIATION HAS BEEN ORGANIZING MATCHES EVEN IN THE REMOTE AREAS IN RAJASTHAN E.G. BARMER, DUNGARPUR, HANUMANGARH, RAJSAMAND ETC., WHERE THERE IS DIRTH OF AUDIENCE AND ASSOCIATION HAS TO ESSENTIALLY INCUR LOSSES. FURTHER, THE ALLEGATION OF THE AO FOR HOLDING THE A CTIVITIES OF ASSOCIATION AS COMMERCIAL WAS SOLELY BASED ON THE CONSIDERATION THAT THE APPELLANT SOCIE TY HAD ACCUMULATION OF SURPLUS, INCREASE IN THE INVESTMENTS, CONTROL OVER THE PLAYERS HOWEVER HE TOTALLY FAILED TO APPRECIATE THAT NORMALLY THE SURPLUS WAS THE RESULT OF SUBSIDIES ONLY AND NOT FR OM THE CONDUCTING OF TOURNAMENTS ON COMMERCIAL BASIS. IT IS PERTINENT TO NOTE HERE THAT SUBSIDIES ARE A FORM OF FINANCIAL AID GRANTED FOR PROMOTING A SPECIFIC CAUSE, WHICH IS ULTIMATELY FOR THE BENEFIT OF OVERALL OR A SECTION OF PUBLIC BUT NEVER FOR THE BENEFIT OF AN INDIVIDUAL ORGANIZATION . THE SUBSIDY RECEIVED WAS UTILIZED IN THE PROMOTION AND DEVELOPMENT OF SPORT OF CRICKET IN ST ATE AT EACH LEVEL, I.E. FROM MUFASILS AREAS TO BIG CITIES LIKE JAIPUR. ALSO, RENTING OUT PREMISES BY RCA HAS BEEN VIEWED A DVERSELY FOR WHICH IT IS RESPECTFULLY SUBMITTED THAT RCA HAS BEEN FORMED WITH A SOLE OBJECTIVE OF P ROMOTING CRICKET AND WITH THE VIEW TO ACHIEVE THE DESIRED OBJECTIVE THE RESTING OF PREMISES AS DO NE IS WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF CRICKET AND NO OTHER ACTIVITY OF WHATSOEVER NATURE HAS BEEN CARRIED OUT AND NEITHER IT IS ENGAGED IN THE SYSTEMATIC ACTIVITY AS HOTELIER, THUS THE SAID ACT OF ASSOCIATION IS FULLY IN THE DIRECTION OF ACH IEVING ITS BASIC OBJECT OF PROMOTING CRICKET AND CANNOT BE VIEWED ADVERSELY. 11 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. IT IS ALSO TO BE NOTED THAT RCA IS RUN BY A COMMITT EE, WHICH CONSISTS OF MEMBERS FROM DIFFERENT WALKS OF THE SOCIETY AND SUCH MEMBERS ARE NOT PROFE SSIONAL MANAGERS OR BUSINESSMEN. AGREEMENT WITH THE PLAYERS IS ONLY TO CONTROL AND MONITOR THE IR ACTIVITIES TO BRING THE SAME IN ACCORDANCE WITH THE OBJECTS. RCA IS PROVIDING TECHNICAL AND FINANCIAL SUPPORT TO THE ALL DCAS (DISTRICT CRICKET ASSOCIATION) I.E. PROVIDING EQUIPMENTS, NETS, BALLS, ETC. WITHOUT ANY CONSIDERATION ON OTHER SIDE RCA IS GETTING ONLY AFFILIATION FEE FROM THEM WHICH IS VERY NOMINAL (RS . 200/- ONLY). IT IS PERTINENT TO NOTE THAT THE RCA HAS PROVIDED GRANTS TO DISTRICTS OF A SUBSTANTIAL A MOUNT RS. 39,20,763/- (APB 5) I.E. RS. 5,69,763/- ON CRICKET EQUIPMENT TO DCA, INFRASTRUCTURE DEVELOP MENT IN DISTRICTS AND RS. 32,00,000/- ON SUBSIDY TO DISTRICTS (APB 14). ALSO, RCA IS ORGANIZING VARIOUS MATCHES OF NATIONAL LEVEL TOURNA MENTS LIKE RANJI TROPHY, IRANI TROPHY, DILIP TROPHY, MAHARANA BHAGWAT SINGH TROPHY , SALIM DURRANI TROPHY, LAXMAN SINGH DUNGARPUR TROPHY, SURYAVEER SINGH TROPHY, U-14, U-1 5, U-19, U-22, ETC. WITHOUT HAVING ANY SURPLUS RATHER THESE WERE ORGANIZED FOR THE DEVELOPMENT OF GAME OF CRICKET AT NATIONAL LEVEL AND TO IDENTIFY THE PLAYERS WHO CAN REPRESENT THE COUNTRY AT INTERN ATIONAL LEVEL. (IN THE YEAR 2007-08 RCA HAS MADE EXPENDITURE OVER RS. 1.12 CRORES). RCA IS UTILIZING A LARGE AMOUNT IN TRAINING AND COA CHING CAMP FOR WHICH NO FEE IS CHARGED FROM THE PARTICIPANTS . FOR THE YEAR UNDER CONSIDERATION A SUM OF RS. 1,92,41,152/- WAS INCURRED TOWARDS RCA CRICKET ACAD EMY EXPENSES. BESIDES THIS, THE ASSESSEE HAD ORGAINSED VARIOUS CHAMPIONSHIP AT VARIOUS INTERIOR PLACES OF RAJASTHAN I.E. BANSWARA, DUNGARPUR, BARMER, SIROHI, RAJSAMAND, DAUSA, BUNDI, KOTA ETC. IN ORDER TO PROVIDE OPPORTUNITY TO CREATE COMPETITIVE ENVIRONMENT FOR THE TALENTED YOUTH, ON WHICH IT SPENT MORE THAN RS. 5.00 CRORES IN THE LAST FIVE YEARS WITHOUT ANY PROFIT MOTIVE WITH THE SOLE INTENTION TO PROMOTE THE GAME OF CRICKET. IN THE MATCH HELD ON 21.12.2010 BETWEEN INDIA V/S SA, RCA SUFFERED DEFICIT OVER RS. 1.6 CRORE ( RECEIPTS FROM IN STADIA RIGHT RS. 1.70 CRORES + SAL E OF TICKET RS. 1.2 CRORES BUT EXPENDITURES RS. 4.1 5 CRORES). THE RCA HAS ALSO INCURRED VARIOUS OTHER EX PENSES WITH A VIEW TO PROMOTE THE GAME OF CRICKET VIZ. ON COACHING CAMPS OF RS. 21,45,550/-, STATE CRICKET ACTIVITIES OF RS. 1,11,90,375/-, GROU ND EXPENSES OF RS. 28,89,930/- AND INTERNATIONAL TOURN AMENT EXPENSES OF RS. 9,02,441/-.( APB- 4 & 5 ) ABOVE, DATA CLEARLY REVEALS THAT SURPLUS, IF ANY GE NERATED BY ASSESSEE WAS MERELY INCIDENTAL TO THE MAIN OBJECT, I.E. PROMOTION OF SPORT OF CRICKET AND IN NO WAY BY RUNNING BUSINESS OF CRICKET AS HAS BEEN ALLEGED BY AO. 12 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. AT THIS JUNCTURE, IT WOULD BE RELEVANT TO RESORT TO THE DECISION OF DELHI HIGH COURT IN THE CASE OF THE INSTITUE OF CHARTERED ... VS THE DIRECTOR GENER AL OF INCOME TAX ... ON 4 JULY, 2013 D EFINING THE TERM BUSINESS IN RELATION TO CHARITABLE INSTI TUTIONS, POST THE AMENDMENT CARRIED OUT IN SECTION 2(15) RELEVANT EXTRACTS OF WHICH ARE AS UNDER: 57 . AFTER DISCUSSING VARIOUS DECISIONS WITH REGARD TO THE SCOPE OF THE WORDS TRADE, COMMERCE & BUSINESS, THIS COURT IN THE INSTITUTE OF CHARTERED ACCOUNTANT OF INDIA V. DIRECTOR GENERAL OF INCOME- TAX (EXEMPTION) (SUPRA) HELD THAT WHILE CONSTRUING THE TERM BUSINESS FOR THE PURPOSE OF SECTION 2(15) OF THE ACT THE OBJECT AND PURPOSE OF THE SECTION MU ST BE KEPT IN MIND AND A BROAD AND EXTENDED DEFINITION OF BUSINESS WOULD NOT BE APPLICABLE FOR THE PURPOSE OF INTERPRETING AND APPLYING THE FIRST PROVISO TO SECTION 2(15) OF THE ACT. THE RELEVANT E XTRACT OF THE SAID JUDGMENT IS AS UNDER:- 'SECTION 2(15) DEFINES THE TERM 'CHARITABLE PURPOSE '. 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 THINK TH AT A VERY BROAD AND EXTENDED DEFINITION OF THE TERM 'B USINESS' IS INTENDED FOR THE PURPOSE OF INTERPRETIN G AND APPLYING THE FIRST PROVISO TO SECTION 2(15) OF THE ACT TO INCLUDE ANY TRANSACTION FOR A FEE OR MON EY. AN ACTIVITY WOULD BE CONSIDERED 'BUSINESS' IF IT IS UNDERTAKEN WITH A PROFIT MOTIVE, BUT IN SOME CASES THIS MAY NOT BE DETERMINATIVE. NORMALLY, THE PROFIT MOTIVE TEST SHOULD BE SATISFIED BUT IN A GIVEN CAS E ACTIVITY MAY BE REGARDED AS BUSINESS EVEN WHEN PROF IT MOTIVE CANNOT BE ESTABLISHED/ PROVED. IN SUCH CASES, THERE SHOULD BE EVIDENCE AND MATERIAL TO SHOW THAT THE ACTIVITY HAS CONTINUED ON SOUND AND RECOGNIZED BUSINESS PRINCIPLES, AND PURSUED WITH REASONABLE CONTINUITY. THERE SHOU LD BE FACTS AND OTHER CIRCUMSTANCES WHICH JUSTIFY AND SHOW THAT THE ACTIVITY UNDERTAKEN IS IN FACT IN THE NATURE OF BUSINESS. THE TEST AS PRESCRIBED IN RAIPUR MANUFACT URING COMPANY [1967] 19 STC 1 (SC) AND SAI PUBLICATION FUND [2002] 258 ITR 70 (SC) ; [2002] 12 6 STC 288 (SC) CAN BE APPLIED. THE SIX INDICIA STIPULATED IN LORD FISHER [1981] STC 238 ARE ALSO R ELEVANT. EACH CASE, THEREFORE, HAS TO BE EXAMINED ON ITS OWN FACTS.' 58. IN THE CASE OF COMMISSIONER OF SALES TAX V. SAI PUBLICATION FUND:[2002] 258 ITR 70 (SC), THE SUPREME COURT WHILE INTERPRETING THE WORD 'BUSINESS ' IN THE CONTEXT OF SECTION 2(5A) OF THE BOMBAY SALES TAX ACT, 1959 HELD THAT THE INCLUSION OF INCIDENTAL OR ANCILLARY ACTIVITY IN TH E DEFINITION OF BUSINESS PRE- SUPPOSES THE EXISTENCE OF TRADE, COMM ERCE AND BUSINESS. THUS, IF THE DOMINANT ACTIVITY OF THE ASSESSEE WAS NOT BUSINESS THEN ANY INCIDENTAL OR ANCILLARY ACTIVITY WOULD ALSO NOT FAL L WITHIN THE DEFINITION OF BUSINESS. IN THAT CASE, THE SUPREME COURT WAS EXAMINING THE ISSUE WHETHER THE ACTIVITY OF THE TRUST IN BRINGING OUT AND SELLI NG A PUBLICATION TO SPREAD THE MESSAGE OF SAI BABA WOULD MAKE THE ASSESSEE TRUST A DEALER. THE SUPREME COURT ALSO REFERRED TO VARIOUS OTHER DECISIONS WHEREIN IT WAS HELD THAT IF THE PRINCIPAL OBJECT OR PURPOSE OF AN ASSESSEE WAS NOT BUSINESS THEN AN INCIDENTAL ACTIVITY WOULD ALSO NOT BE EXIGIBLE TO S ALES TAX AND CONSTITUTE THE ASSESSEE AS A DEALER. I N THE CASE OF STATE OF GUJARAT V. RAIPUR MANUFACTURIN G CO. LTD.: (1967) 19 STC 1 (SC), THE SUPREME COURT HELD THAT IN ORDER FOR ANY ACTIVITY TO BE CON SIDERED AS BUSINESS, THERE MUST BE A COURSE OF DEALINGS EITHER ACTUALLY CONTINUED OR CONTEMPLATED TO BE CONTINUED WITH THE MOTIVE TO EARN PROFIT AND NOT FOR SPORT OR PLEASURE. 67. THE EXPRESSIONS 'TRADE', 'COMMERCE' AND 'BUSINESS' AS OCCURRING IN THE FIRST PROVISO TO SECTION (15) OF THE ACT MUST BE READ IN THE CONTEX T OF THE INTENT AND PURPORT OF SECTION 2(15) OF THE ACT AND CANNOT BE INTERPRETED TO MEAN ANY ACTIVITY WHICH IS CARRIED ON IN AN ORGANISED MANNER . THE PURPOSE AND THE DOMINANT OBJECT FOR WHICH AN INSTIT UTION CARRIES ON ITS ACTIVITIES IS MATERIAL TO 13 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. DETERMINE WHETHER THE SAME IS BUSINESS OR NOT . THE PURPORT OF THE FIRST PROVISO TO SECTION 2(15) O F THE ACT IS NOT TO EXCLUDE ENTITIES WHICH ARE ESSENT IALLY FOR CHARITABLE PURPOSE BUT ARE CONDUCTING SOME ACTIVITIES FOR A CONSIDERATION OR A FEE. THE O BJECT OF INTRODUCING THE FIRST PROVISO IS TO EXCLUD E ORGANIZATIONS WHICH ARE CARRYING ON REGULAR BUSINES S FROM THE SCOPE OF 'CHARITABLE PURPOSE'. THE PURPOSE OF INTRODUCING THE PROVISO TO SECTION 2(15) OF THE ACT CAN BE UNDERSTOOD FROM THE BUDGET SPEECH OF THE FINANCE MINISTER WHILE INTRODUCING TH E FINANCE BILL 2008. THE RELEVANT EXTRACT TO THE SPEECH IS AS UNDER:- '.......'CHARITABLE PURPOSE' INCLUDES RELIEF OF THE POOR, EDUCATION, MEDICAL RELIEF AND ANY OTHER OBJE CT OF GENERAL PUBLIC UTILITY. THESE ACTIVITIES ARE TAX EXEMPT, AS THEY SHOULD BE. HOWEVER, SOME ENTITIES CARRYING ON REGULAR TRADE, COMMERCE OR BUSINESS OR PROVIDING SERVICES IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS AND EARNING INCOMES HAVE SOUGH T TO CLAIM THAT THEIR PURPOSES WOULD ALSO FALL UNDER 'CHARITABLE PURPOSE'. OBVIOUSLY, THIS WAS NOT THE INTENTION OF PARLIAMENT AND, HENCE, I PROPOSE TO AMEND THE LAW TO EXCLUDE THE AFORESAID CASES. GE NUINE CHARITABLE ORGANIZATIONS WILL NOT IN ANY WAY BE AFFECTED.' THE EXPRESSIONS 'BUSINESS', 'TRADE' OR 'COMMERCE' A S USED IN THE FIRST PROVISO MUST, THUS, BE INTERPRETED RESTRICTIVELY AND WHERE THE DO MINANT OBJECT OF AN ORGANISATION IS CHARITABLE ANY INCIDENTAL ACTIVITY FOR FURTHERANCE OF THE OBJECT W OULD NOT FALL WITHIN THE EXPRESSIONS ' BUSINESS', 'TRADE' OR 'COMMERCE'. 77. AFTER GOING THROUGH THE PROVISIONS OF THE ICAI ACT AND THE REGULATIONS FRAMED THEREIN AS WELL AS VARIOUS ACTIVITIES CARRIED ON BY THE PETITIONER, WE ARE OF THE VIEW THAT THE PETITIONER INSTITUTE DOES NOT CARRY ON ANY BUSINESS, TRADE OR COMMERCE. THE ACTIVITY OF IMPARTING EDUCATION IN THE FIELD OF ACCOUNTANCY AND CONDUCTING COURSES BOTH AT PRE-QUAL IFICATION AS WELL AS POST-QUALIFICATION LEVEL ARE ACTIVITIES IN FURTHERANCE OF THE OBJECTS FOR WH ICH THE PETITIONER HAS BEEN CONSTITUTED. ACTIVITIES OF PROVIDING COACHING CLASSES OR UNDERTAKING CAMPUS PLACEMENT INTERVIEWS FOR A FEE ARE IN RELATION TO THE MAIN OBJECT OF THE PETITIONER WHICH AS STATE D EARLIER CANNOT BE HELD TO BE TRADE, BUSINESS OR COMMERCE. ACCORDINGLY, EVEN THOUGH FEES ARE CHARGED BY THE PETITIONER INSTITUTE FOR PROVIDING COACHING CLASSES AND FOR HOLDING INTERVIEWS WITH RE SPECT TO CAMPUS PLACEMENT, THE SAID ACTIVITIES CANNOT BE STATED TO BE RENDERING SERVICE IN RELATIO N TO ANY TRADE, COMMERCE OR BUSINESS AS SUCH ACTIVITIES ARE UNDERTAKEN BY THE PETITIONER INSTITU TE IN FURTHERANCE OF ITS MAIN OBJECT WHICH AS HELD EARLIER ARE NOT TRADE, COMMERCE OR BUSINESS. A PERUSAL OF ABOVE CLARIFIES THAT SO FAR AS PRE DOM INANT OBJECT OF INSTITUTION IS CHARITABLE, ANY INCIDENTAL ACTIVITY THERETO RESULTING INTO PROFITS WOULD NOT IPSO FACTO RESULT INTO DENIAL OF EXEMPTIO N U/S 11. FURTHER HONBLE MADRAS HIGH COURT IN THE CASE OF TAMIL NADU CRICKET ASSOCIATION VS THE DIRECTOR OF INCOME TAX, WHEREIN REFERENCE HAS BEEN MADE TO CIRCULAR NO.11 O F 2008 OF CBDT DATED 19.12.2008, HELD THAT QUESTION OF REJECTION OF REGISTRATION UND ER SECTION 12AA(3) WOULD ARISE ONLY IN THOSE CASES WHERE AN ENTITY USES THIS STATUS OF CHARITABLE WIT H A CHARITABLE OBJECT OF GENERAL PUBLIC UTILITY AS A MASK OR A DEVICE TO HIDE THE TRUE PURPOSE AND THAT OBJECT IS NOTHING OTHER THAN TRADE, COMMERCE OR BUSINESS. THUS REVENUE HAS TO SUBSTANTIATE ABSEN CE OF GENUINENESS . MERE CONDUCTING MATCHES OR EARNING INCOME FROM INCIDENTAL ACTIVITIES WOULD NOT ENTAIL CANCELLATION OF REGISTRATION. 14 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. HONBLE DELHI BENCH OF ITAT IN THE CASE OF DELHI & DISTRICT CRICKET ASSOCIATION VS DIT(E) HAS OBSERVED AS UNDER: (RELEVANT EXTRACTS) 10.7. EVEN OTHERWISE THE MAIN AND PREDOMINANT OBJEC T AND ACTIVITY OF THE ASSESSEE IS TO PROMOTE, REGULATE AND CONTROL THE GAME OF CRICKET IN AND ARO UND DELHI. THE UNDISPUTED FACT IS THAT OVER THE YEARS THIS ACTIVITY HAS BEEN RECOGNIZED BY THE INCO ME TAX DEPT. AS A CHARITABLE ACTIVITY AND REGISTRATION U/S 12A WAS GRANTED TO THE ASSESSEE . A NUMBER OF ASSESSMENT ORDERS U/S 143(3) WERE PASSED, WHEREIN THE ASSESSEE WAS HELD AS ELIGIBLE F OR EXEMPTION U/S 11/12 OF THE ACT. HENCE THIS FACT OF THE ASSESSEE BEING A CHARITABLE INSTITUTION IS N OT IN DISPUTE. 10.8. THE CORE ACTIVITY OF THE ASSESSEE IS UNDISPUTEDLY, CHAR ITABLE IN NATURE. HENCE IT IS NOT THE CASE OF THE REVENUE THAT THE ASSESSEE IS CARRYING ON 'TR ADE, COMMERCE OR BUSINESS' UNDER THE GARB OF THE ACTIVITY BEING 'GENERAL PUBLIC UTILITY. AS REGARDS THE VARIOUS RECEIPTS OF THE ASSESSEE, WE FIND THAT IN THE CASE OF TAMIL NADU CRICKET ASSOCIATION, THE RECEIPTS WERE FROM: 1. SUBSCRIPTION 2. RENTING FOR HIRING CRICKET GROUND ROOMS AND PREM ISES 3. FEE FOR PROVIDING SERVICES FOR IPL 4. INCOME FROM ADVERTISEMENT 5. SUBSIDY FROM BCCI 6. SALE OF TICKETS FOR CONDUCTING THE MATCHES AND 7. RESTAURANT AND CATERING INCOME. SUCH RECEIPTS OF MONEY BY THE TAMIL NADU CRICKET ASSOCIATION WERE NOT CONSIDERED BY THE HON'BLE MADRAS HIGH COUR T, AS ACTIVITIES IN THE NATURE OF 'TRADE, COMMERCE OR BUSINESS'. THERE IS NO CONTRARY DECISIO N CITED BY THE REVENUE. THUS NONE OF THE ABOVE STREAMS OF INCOME, WHEN RECEIVED BY THE ASSESSEE WO ULD CONSTITUTE BUSINESS ACTIVITY FOR THE ASSESSEE. 10.9. THUS RESPECTFULLY FOLLOWING THE DECISION OF HON'BLE MADR AS HIGH COURT IN THE CASE OF TAMIL NADU CRICKET ASSOCIATION (SUPRA), WE HAVE TO HOLD T HAT THE AMOUNTS RECEIVED BY THE ASSESSEE FROM A) GROUND BOOKING CHARGES, B) HEALTH CLUB CHARGES, C) INCOME FROM CORPORATE BOXES, D) LAWN BOOKING INCOME, E) SPONSORSHIP MONEY AND SALE OF TI CKETS, ADVERTISEMENT, SOUVENIRS AND OTHER SUCH RECEIPTS DO NOT RESULT IN THE ASSESSEE BEING H ELD AS UNDERTAKING ACTIVITIES IN THE NATURE OF 'TRADE, COMMERCE OR BUSINESS.' THESE RECEIPTS ARE I NTRINSICALLY RELATED, INTERCONNECTED AND INTERWOVEN WITH THE CHARITABLE ACTIVITY AND CANNOT BE VIEWED SEPARATELY. THE ACTIVITIES RESULTING IN THE SAID RECEIPTS ARE ALSO CHARITABLE ACTIVITIES AN D NOT 'TRADE, COMMERCE OR BUSINESS' ACTIVITIES . 11. WE NOW TAKE UP EACH OF THE ISSUES RAISED BY THE LD.DIT(E) IN HIS ORDER. 11.1. ON THE ISSUE OF SPONSORSHIP INCOME FROM M/S. TWENTY FIRST CENTURY MEDIA (P) LTD. (TFC M), IT WAS EXPLAINED THAT, DESPITE THE RECEIPT OF SPONSORS HIP MONEY DURING THE YEAR OF RS.31,01,038/- AND 15 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. RECEIVING A SUM OF RS.14,20,000/- FROM BCCI AS SUBS IDY, THERE WAS A SHORT FALL OF RS.29,84,835/-, WHICH WAS MET BY THE ASSESSEE. IT WAS SPECIFICALLY ARGUED BY THE LD.D.R. THAT THE AGREEMENT WITH 'M/S TWENTY FIRST CENTURY MEDIA PVT.LTD.' IS COMMER CIAL IN NATURE. THE REPLY OF THE ASSESSEE IS THAT I T SHOULD BE APPRECIATED THAT, FOR ANY ORGANIZATION TO RUN AND SURVIVE IT IS ESSEN TIAL THAT IT SHOULD AUGMENT SOME FUNDS TO MEET THE COST/EXPENDITURE, AS REQUIRED TO BE INCURRED, TO CARRY OUT THE ACTIVITIES MEANT TO ACHIEVE ITS OBJECT. WE AGREE WI TH THE SUBMISSIONS OF THE ASSESSEE . 11.2. THE ASSESSEE HAS TO PERFORM MANY ACTIVITIES AND FOR THIS PURPOSE IT HAS TO ENTER INTO TRANSACTIONS WITH VARIOUS TYPES OF PERSONS. THESE P ERSONS CAN BE COMMERCIAL OR NON-COMMERCIAL ORGANIZATIONS, PROFESSIONALS, VENDORS OF GOODS, VEN DOR OF SERVICES AND SO FORTH AND SO ON. MERELY ENTERING INTO SUCH AGREEMENT DOES NOT TANTAMOUNT TO THE ASSESSEE BEING A BUSINESS ENTITY . THE QUESTION IS WHETHER THE ACTIVITY DONE BY ASSESSEE, WOULD TANTAMOUNT TO BUSINESS ACTIVITY OR NOT. THIS HAS TO BE VIEWED, FROM VIEW POINT OF THE ASSES SEE. THE OTHER PERSON WITH WHOM THE ASSESSEE HAS AN AGREEMENT, MAY HAVE ITS OWN OBJECT AND REASO N FOR DOING TRANSACTION AND ACCORDINGLY, THE NATURE OF TRANSACTION AND THE RESULTANT ACTIVITY WOULD BE DE TERMINED IN THE OTHER PERSONS HANDS. HOWEVER, THAT BY ITSELF, SHOULD NOT HAVE ANY BEARIN G AT ALL ON THE NATURE OF THE TRANSACTION, AS WELL AS RESULTANT ACTIVITY IN THE HANDS OF ASSESSEE. TO CARRY OUT A TRANSACTION IN AN ORGANIZED MANNER A ND TO ENSURE THAT THE TRANSACTION WOULD HELP THE ASSESSEE IN ACHIEVING ITS CHARITABLE OBJECT, IT IS IMPERATIVE THAT THE TERMS AND CONDITIONS OF THE TRA NSACTIONS ARE CLEARLY DEFINED, TO AVOID ANY CONFUSION OR CHAOS . IT WILL BE FURTHER GOOD, IF THESE TERMS AND CONDI TIONS ARE REPRODUCED IN WRITING, IN THE FORM OF AN AGREEMENT. MERELY BECAUSE AN ACTIVIT Y IS PERFORMED IN AN ORGANIZED MANNER, THAT ALONE WILL NOT MAKE THESE ACTIVITIES AS BUSINESS/CO MMERCIAL ACTIVITY. PROFIT MOTIVE IS ONE ESSENTIAL INGREDIENT, WHICH IS APPARENTLY MISSING IN THIS CAS E. IN CARRYING OUT AN ACTIVITY, ONE MAY EARN PROFIT, OR ONE MAY INCUR LOSS. BUT FOR MAKING IT AS BUSINES S ACTIVITY, THE PRESENCE OF PROFIT MOTIVE IS A SIN QUA NON I.E. CONDITION PRECEDENT AT THE TIME OF ENT ERING INTO TRANSACTION. IN THIS CASE THE FACTS DEMONSTRATE THAT DESPITE THE RECEIPT OF AMOUNT FROM SPONSORSHIP AND SUBSIDY FROM BCCI, THERE WAS DEFICIT, WHICH WAS MET BY THE ASSESSEE. THUS THIS A DJUSTMENT RESULTED IN SUBSIDIZING THE COST OF THE ASSESSEE AND HENCE THERE IS NO PROFIT MOTTO. THIS C ANNOT BE TERMED AS BUSINESS ACTIVITY. SIMILAR IS TH E VIEW OF THE HON'BLE MADRAS HIGH COURT IN THE CASE O F TAMIL NADU CRICKET ASSOCIATION (SUPRA). 11. 3. ON THE ISSUE OF SALE OF LIQUOR, IT WAS SUBMI TTED THAT INITIALLY DDCA WAS FORMED AS A CLUB TO TA KE OVER THE ASSETS AND LIABILITIES OF THE ASSOCIATION CALLED, 'DELHI CRICKET ASSOCIATION'. HE REFERRED TO THE OBJECTS AND SUBMITTED AS FOLLOWS. 'ONE OF THE OBJEC TS AS GIVEN IN THE MOA OF DDCA IS TO LAY GROUND FOR PLAYING GAME OF CRICKET AND TO PROVIDE PAVILION , REFRESHMENT ROOMS AND OTHER FACILITIES IN CONNECTION THEREWITH. THEREFORE, AN EATERY WAS ESTA BLISHED WHICH WAS EVENTUALLY SHAPED AS A CANTEEN FOR THE BENEFIT OF THE MEMBERS AS WELL AS F EW OTHER PERSONS ASSOCIATED WITH DDA E.G. PLAYERS, COACHES, STAFF, OTHER GUESTS ETC.' 11.4. IN OUR VIEW, FOR THE PURPOSE OF MAKING THIS C ANTEEN SELF SUSTAINABLE, IT HAS TO FOLLOW GLOBAL STANDARDS AND INTERNATIONAL PROTOCOLS, SINCE CRICKE T IS PLAYED AT INTERNATIONAL LEVEL. CANTEEN KEEPS VARIOUS ITEMS AS PER MENU. LIQUOR IS JUST PART OF T HIS MENU. IT IS NOT SOLD INDEPENDENTLY AS TRADING ITEM. THE EATERY IS AVAILABLE FOR THE USE ONLY OF M EMBERS, PLAYERS, STAFF, OTHER GUESTS OF DDCA. IT IS NOT OPEN FOR PUBLIC. A WALK IN CUSTOMER/GUEST, CANN OT ENJOY THE FACILITY OF THIS EATERY. THE BASIC FAC T IS THAT THIS CANTEEN HAS DIRECT AND INEXTRICABLE LI NK WITH ONE OF THE CORE ACTIVITIES OF DDCA I.E. 16 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. MAINTAINING SUCH A HUGE CRICKET STADIUM AND PROMOTI NG THE GAME OF CRICKET. THE REVENUE, IN THIS CASE IS TRYING TO PROJECT THAT THE ASSESSEE AS A LI QUOR DEALER. THIS IS NOT CORRECT. INTERNATIONALLY, WHEN FACILITIES ARE PROVIDED TO PLAYERS, LIQUOR IS PART OF THE MENU. THIS IS JUST INCIDENTAL TO PROVIDING F OOD AND BEVERAGES. WHEN THE LD.DIT(E) DOES NOT FIND ANY THING WRONG IN THE ASSESSEE SUPPLYING FOOD AND BEVERAGES IN THE CANTEEN TO THE MEMBERS, WE CANNOT FIND FAULT WITH LIQUOR BEING PART OF THE MENU CARD AND BEING SERVED AS PER INTERNATIONAL CUSTOMS AND REQUIREMENTS. 11.5. HENCE TO MEET GLOBAL STANDARDS THESE FACILITIES ARE REQUIRED AND THESE A RE NOT INDEPENDENT OF THE ACTIVITY OF PROVIDING FOO D AND REFRESHMENTS ITA NO. 3095/DEL/2012 DELHI & DIST RICT CRICKET ASSOCIATION, NEW DELHI TO MEMBERS AND ASSOCIATED PERSONS. RUNNING OF A CANTEEN IS AN INCIDENTAL AND NECESSARY ACTIVITY AS IS IN EVERY ORGANIZATION. THIS CANNOT BE TERMED AS BUSINESS ACT IVITY. IT IS PART AND PARCEL OF THE CHARITABLE ACTI VITY AND THE RECEIPT IN QUESTION CANNOT BE TERMED AS EXE MPT FROM ACTIVITY WHICH IS IN THE NATURE OF 'TRADE, COMMERCE OR BUSINESS'. 11.6. ON ADVERTISING AND CONTRACTUAL RECEIPTS THE SAME EXPLANATION AS WAS GIVEN BY THE ASSESSEE, AS IN THE CASE OF SPONSORSHIP MONEY. CONSISTENT WITH T HE VIEW EXPRESSED BY US, WHEN WE WERE DEALING WITH SPONSORSHIP MONEY, WE HOLD THAT THESE CONTRACTUAL RECEIPTS GO TO REDUCE PART OF THE COST INCURRED BY THE ASSESSEE FOR ITS CHARITABLE ACTIVIT Y AND HENCE CANNOT BE TERMED AS BUSINESS OR THAT THE ASSESSEE HAS UNDERTAKEN ACTIVITY IN THE NATURE OF 'TRADE, COMMERCE OR BUSINESS '. 11.7. ON RECEIPTS FROM IPCL AN ELABORATE EXPLANATION WAS GIVEN, THE PITH AND S UBSTANCE IS THAT EXPENDITURE HAS TO BE INCURRED BY THE DDCA ON VARIO US ITEMS, AS COORDINATION HAS TO BE DONE AND THE AGGREGATE OF EXPENDITURE INCURRED FOR THE SAME IS RS.238 LAKHS. IT WAS SUBMITTED THAT THE DDCA, INITIALLY MEETS THIS EXPENDITURE OUT OF ITS O WN SOURCES AND THERE AFTER THE BCCI AND LEGAL FRANCHISEE, CONTRIBUTE AND COMPENSATE PART OF THIS EXPENSES . THE SAME ARGUMENTS AS WERE ADVANCED BY THE ASSESSEE IN THE CASES WHERE SPONSOR SHIP MONEY RECEIVED, WERE MADE HERE ALSO. THE SUMMARY OF THE SUBMISSIONS ARE AS FOLLOWS. 'OUR RES PECTFUL SUBMISSION IS THAT, AS WE HAVE GIVEN DETAILED SUBMISSION IN EARLIER PART OF OUR SUBMISSI ONS WHEREIN WE HAVE MADE ANALYSES OF RECEIPTS AS WELL AS OF THE EXPENSES INCURRED BY THE ASSESSEE. T HE ANALYSIS OF EXPENSES HAVE REVEALED THAT THE EXPENSES HAVE BEEN INCURRED ON THE PROMOTION OF THE GAME OF CRICKET. THESE EXPENSES HAVE BEEN INCURRED EITHER FOR THE DEVELOPMENT OF GAME OF CRIC KET OR THE DEVELOPMENT OF PLAYERS . THERE IS NO OTHER CAUSE OR ITEM FOR WHICH ANY AMOUNT HAS BEEN S PENT BY THE ASSESSEE. SIMILARLY, WHEN WE ANALYSE THE RECEIPT SIDE, WE WOULD FIND THAT THE RE CEIPTS ARE DIRECTLY OR INEXTRICABLY LINKED WITH THE ORGANIZING OF MATCHES AND TOURNAMENTS OR FOR PROMOT ION OF GAME OF CRICKET IN ANY OTHER MANNER OR FOR MAINTENANCE OR BUILDING UP THE INFRASTRUCTUR E MEANT FOR THE PROMOTION OF THE GAME OF CRICKET. THUS, IT CAN BE SAFELY SAID THAT THE DDA E XISTS FOR CRICKET AND CRICKET ONLY. THE CBDT HAS ALREADY CLARIFIED THAT SPORTS IS A MATTER OF GENERA L PUBLIC UTILITY. THEREFORE DDCA SATISFIES THE CONDITION OF HAVING A CHARITABLE OBJECT AS MENTIONE D IN S.2(15) OF THE INCOME TAX ACT, 1961. IT DOES NOT VIOLATE ANY CONDITION AS MENTIONED IN PROVISO T O S.2(15). THE APPREHENSION THAT CERTAIN INCOME RECEIVED BY THE ASSESSEE, DURING THE YEAR, PARTAKE THE CHARACTER OF BUSINESS INCOME, IS ILL FOUNDED. IN THIS REGARD WE HAVE SUBMITTED IN DETAIL THAT THI S APPREHENSION IS MISPLACED ON ACCOUNT OF VARIOUS SUBMISSIONS AS PER DETAILS GIVEN BELOW. 1. THE ENTI RE RECEIPTS HAVE BEEN RECEIVED FOR THE PROMOTION OF GAME OF CRICKET. 2. THE ASSESSEE IS NOT FREE TO USE IT AS PER ITS CONVENIENCE FOR ANY PURPOSE OTHER TH AN FOR PROMOTION OF CRICKET. THUS, THE AMOUNTS RECEIVE D IN THIS MANNER CANNOT BE CHARACTERIZED AS BUSINESS RECEIPTS. THE AMOUNT HAS BEEN RECEIVED AS THE VOLUNTARY CONTR IBUTION ON DISCRETION OF THE 17 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. CONTRIBUTOR (FOR E.G. BCCI). THESE HAVE BEEN RECEIV ED FOR RAISING THE FUNDS FOR MEETING ITS COSTS AND EXPENSES. 4. IN NONE OF THE CASES THERE IS ANY QUID PRO QUO. THE ULTIMATE BENEFICIARY IS EITHER THE CRICKETER OR THE GAME OF THE CRICKET . 5. THE ASSESSEE IS NOT CHARGING ANY FEES OR REVENUE FROM T HE CRICKETER WHO IS ULTIMATE BENEFICIARY. THUS, THERE IS NO QUID PRO QUO RELATIONSHIP WITH T HE CRICKETER. THE ASSESSEE IS PROMOTING CRICKET ON CHARITABLE BAS IS AS FAR AS REAL BENEFICIARY IS CONCERNED. 6. WHENEVER THE REVENUE IS EARNED THESE ARE NOT EARNED ON COMMERCIAL LINES AND THESE ARE EARNED WITHOUT ANY COMMERCIAL ATTRIBUTES. THE REVENUE IS G ENERATED FOR RECOVERING THE COST, AT LEAST PARTLY I F NOT FULLY. 7. THE ASSESSEE HAS NOT ENTERED ANY TRAN SACTION WITH ANY PERSON ON PROFIT MOTIVE. THE OTHER PERSON MAY BE AN ENTREPRENEUR OR MAY BE DOING BUSIN ESS BUT THE ASSESSEE HAS ENTERED THE TRANSACTION ONLY FOR THE SOLE AND DEDICATED PURPOSE I.E. FOR THE PROMOTION OF CRICKET . 8. THESE FACTS ARE WORTH NOTING THAT (A) THE ASSESSEE HAS NOT DIVE RTED ITS FUNDS FOR ANY PURPOSE OTHER THAN PROMOTION OF CRICKET; (B) THE ASSESSEE HAS NOT DONE ANY ACTIVITY OR TRANSACTION WITH PROFIT MOTIVE, (C ) THE ASSESS HAS NOT DONE ANY ACTIVITY BEYOND AND OUT SIDE ITS OBJECTS AND (D) THERE IS NO CHANGE IN FACT S SO AS TO DEVIATE FROM THE STAND TAKEN BY LD. AO IN ALL THE PAST YEARS ACCEPTING THE CLAIM OF THE ASSESSEE ALL ALONG ON FACTS AS WELL AS ON LAW. 11.8. IN VIEW OF OUR DECISION OF SPONSORSHIP AND SU CH OTHER RECEIPTS, WE AGREE WITH THE ARGUMENTS MADE BY THE ASSESSEE. REGARDING SALE OF TICKETS THE ASSESSEE EXPLAINED THAT NO TICKETS ARE SOLD FOR RANJI TROPHY AND ONLY IN CASE OF INTERNATIONAL MATC HES, RS.200/- PER TICKET ARE LEVIED, WITH A SOLE INTENTION TO CONTROL THE CROWDS AND THAT THE COST I NCURRED PER TICKET IS MUCH MORE THAN THE AMOUNT WHICH IS CHARGED FOR TICKET. UNDER THESE CIRCUMSTAN CES, THE SALE OF TICKETS CANNOT BE CONSIDERED AS AN ACTIVITY OF 'TRADE, COMMERCE OR BUSINESS'. WE AGREE WITH THE SUBMISSIONS OF THE ASSESSEE. 11.9. REGARDING PLAYING CARDS, IT IS AN INCIDENTAL RECREATION ACTIVITY UNDERTAKEN IN MOST CLUBS AND WHAT IS CHARGED BY THE ASSESSEE, GOES TO RECOVER TH E COSTS FOR PROVIDING SUCH RECREATIONAL FACILITY TO ITS MEMBER. THE RECEIPTS ARE MINISCULE AND HENCE NE GLIGIBLE. 11.10. SIMILARLY AS FAR AS RECEIPTS FROM HEALTH CLUB IS CONCERNED, WE FIND THAT, ONLY A PART OF THE EXPENDITURE INCURRED ON HEALTH CLUB IS RECOVERED BY WAY OF CHARGES FROM MEMBERS, WHO ARE U SING THE HEALTH CLUB FACILITY. THESE ARE ALL, AT BEST BE CALLED USER CHARGES. IN OUR VIEW THESE RECE IPTS CANNOT BE TERMED AS AN ACTIVITY IN THE NATURE OF 'TRADE, COMMERCE OR BUSINESS'. IN FACT HEALTH CL UB FACILITY IS RECOGNIZED TO PROMOTE THE GAME OF CRICKET. ALL THE RECEIPTS OF THE ASSESSEE ARE INTRI NSICALLY LINKED WITH THE ACTIVITY OF ORGANIZING MAT CHES AND TOURNAMENTS FOR THE PROMOTION OF CRICKET. USER CHARGES ARE REQUIRED FOR MAINTAINING THE FACILITIES THAT ARE PROVIDED AS PART OF THE INFRASTRUCTURE, FO R CONDUCTING THE ACTIVITIES OF THE ASSESSEE. 11.12. ON CONSIDERATION OF ALL THE FACTS AND CIRCUMSTANCES OF THE CASE AND WHEN VIEWED IN TOTALITY, WE HAVE TO COME TO A CONCLUSION THAT THE ASSESSEE I S NOT CARRYING OF THE ACTIVITIES WITH ANY PROFIT MOTIVE OR WITH ANY SELF INTEREST. THE CONTRIBUTION RECEIVED BY WAY OF SPONSORSHIP, ADVERTISEMENT, SALE OF TICKETS ETC. AND USER CHARGES ON THE FACTS OF THIS CASE, DO NOT CONVERT THE CHARITABLE ACTIVIT Y INTO 'TRADE, COMMERCE OR BUSINESS' ACTIVITY 11.13. IN VIEW OF THE ABOVE DISCUSSION AND IN VIEW OF THE BINDING JUDGEMENTS CITED ABOVE, WE HAVE TO NECESSARILY QUASH THE IMPUGNED ORDER PASSED BY T HE DIT(E) U/S 12AA(3) R.W.S. 12 OF THE ACT, AS IT IS BAD IN LAW. DDIT VS. ALL INDIA FOOTBALL FEDERATION [2015] 62 TA XMANN.COM 362 (DELHI-TRIB.). 18 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. S. 2(15) ACTIVITY OF SOCIETY TO PROMOTE FOOTBALL TH E MAIN OBJECTIVE OF THE ASSESSEE WAS TO PROMOTE THE GAME OF FOOTBALL IN INDIA WHICH CERTAINLY AMOUNTS T O CHARITABLE PURPOSE, BEING COVERED UNDER THE LIMB THE ADVANCEMENT OF ANY OTHER OBJECT OF GENERA L PUBLIC UTILITY AS CONTAINED IN SECTION 2(15). THE RECEIPT OF FEES FROM THE SPONSORSHIP RIGHTS AND TELECASTING RIGHTS DO NOT AMOUNT TO CARRYING OUT OF ANY ACTIVITY IN THE NATURE OF TRADE, COMMERC E OR BUSINESS BUT IS INCIDENTAL TO CARRYING ON OF THE MAIN OBJECTIVE OF THE RESPONDENT ASSESSEE. IT W AS FURTHER OBSERVED THAT NO PART OF ITS SURPLUS COULD BE DISTRIBUTED TO THE BOARD OF ITS MEMBERS IN THE FORM OF DIVIDEND OR PROFIT. THE MERE FACT THAT THE APPELLANT SOCIETY HAD GENERATED SPONSORSHI P FUNDS, DURING THE COURSE OF CARRYING ON THE ANCILLARY OBJECTS, SHALL NOT ALTER THE CHARACTER OF THE MAIN OBJECTS SO LONG AS THE PREDOMINANT OBJECT CONTINUES TO BE CHARITABLE AND NOT TO EARN T HE PROFIT. FURTHER THE PROVISO TO SECTION 2(15) OF THE ACT CANNOT BE APPLIED TO THE APPELLANT SOCIETY AS IT IS NOT ENGAGED IN ANY ACTIVITY WHICH IS IN THE NATURE OF TRADE, COMMERCE AND BUSINESS. THEREFO RE, THE SOCIETY HAS TO BE NECESSARILY CONSIDERED A GENUINE CHARITABLE ORGANIZATION ELIGIB LE TO CLAIM EXEMPTION U/SS. 11 & 12 OF THE ACT AND THE PROVISIONS OF THE FIRST PROVISO TO SECTION 2(15) DO NOT APPLY TO THE CASE OF THE APPELLANT. COMING TO THE FACTS OF THE CASE, AS SUBMITTED EARLI ER RCA WAS SET UP UNDER STATUTE ONLY FOR THE PROMOTION OF THE SPORTS AND IN PARTICULAR CRICKET A ND HAD IT BEEN NOT CARRYING OUT ACTIVITIES IN ACCORDANCE WITH ITS OBJECTS, REGISTRATION COULD HAV E BEEN WITHDRAWN. CHAPTER V OF RAJASTHAN SPORTS (REGISTRATION, RECOGNITION AND REGULATION OF ASSOCI ATION) ACT, 2005 CONTAINS PROVISIONS REGARDING ACCOUNTS, AUDIT AND INSPECTION OF BOOKS OF ACCOUNTS OF SPORTS ASSOCIATION REGISTERED UNDER SAID ACT, WHEREAS CHAPTER VI THEREOF CONTAINS SPECIFIC PROVIS IONS REGARDING DISAFFILIATION, INQUIRY AND DISQUALIFICATION. IN OTHER WORDS, RCA IS NOT AN IN DEPENDENT PRIVATE ORGANIZATION, WHICH CAN CARRY OUT ACTIVITIES AS PER CONVENIENCE OF ITS OFFICIALS, RATHER IT WORKS UNDER STRICT REGULATIONS AND THUS ANY DEVIATION FROM PRIMARY OBJECTIVE OF PROMOTION OF SP ORT OF CRICKET MAY COST DISAFFILIATION/ DISQUALIFICATION TO THE ASSOCIATION. THUS, IN THE ABSENCE OF ANY ADVERSE FINDING BY THE CONCERNED AUTHORITY, CONCLUSION DRAWN THAT RCA WAS BEING RUN ON COMMERCIAL BASIS DOES NOT HAVE BASIS. IN VIEW OF ABOVE, IT IS PRAYED THAT ACTIVITIES OF A SSESSEE ARE COMPLETELY FOR THE PURPOSE OF ATTAINMEN T OF ITS OBJECTIVE OF PROMOTING CRICKET AND IN NO WAY BEING RUN ON COMMERCIAL LINES. IT IS THEREFORE PRAYED THAT EXEMPTION U/S 11 MAY BE ALLOWED TO ASSE SSEE. .GROUND OF APPEAL NO. 6: IN THIS GROUND OF APPEAL, ASSESSEE HAS CHALLENGED T HE ACTION OF LD. CIT(A) IN CONFIRMING DISALLOWANCE OF EXPENSES OF RS. 6,15,32,225/- INCURRED ON ACQUIS ITION OF CAPITAL ASSET, BEING IN THE NATURE OF APPLICATION OF INCOME U/S 11. IN THIS REGARD, IT IS SUBMITTED THAT IT IS A WELL S ETTLED LAW THAT WHERE INCOME IS APPLIED FOR PURCHAS E OF A CAPITAL ASSET, IT WOULD STILL BE APPLICATION OF I NCOME TO THE CHARITABLE PURPOSE. IF THE ASSESSEE 19 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. INVESTS IN CONSTRUCTION OF A BUILDING, WHICH IS A P ERMISSIBLE INVESTMENT UNDER SECTION 11(5) OF THE INCOME-TAX ACT, SO AS TO AUGMENT ITS RESOURCES FOR FULFILLING THE OBJECTIVES OF THE INSTITUTION, THERE IS NO DOUBT THAT SUCH CAPITAL OUTLAY WOULD QUALIFY AS INCOME APPLIED FOR CHARITABLE PURPOSES. FURTHER, NO DOUBT HAS BEEN RAISED BY AO THAT INVEST MENT IS NOT APPLIED FOR THE PURPOSES OF BUSINESS. THUS, IN VIEW OF OUR ABOVE SUBMISSION REGARDING ELI GIBILITY OF EXEMPTION U/S 11, THIS GROUND IS COMPLETELY CONSEQUENTIAL IN NATURE. IT IS THUS PRAY ED THAT SUM OF RS. 6,15,32,225/-BE ALLOWED AS APPLICATION OF INCOME IN CONSONANCE OF PROVISIONS O F SECTION 11. GROUND OF APPEAL NO. 8 & 9: IN GROUND OF APPEAL NO.8 , ASSESSEE HAS CHALLENGED THE ACTION OF LD. CIT(A) IN CONFIRMING THE ASSESSMENT OF INCOME OF RS.4,07,58,505/- AS BUSINE SS INCOME IN THE HANDS OF ASSESSEE, WHEREAS IN GROUND OF APPEAL NO.9 CHARGING OF INTEREST U/S 234B & 234D HAVE BEEN CHALLENGED. IN THIS REGARD, IT IS SUBMITTED THAT BOTH THE GROUN DS OF APPEAL ARE CONSEQUENTIAL IN NATURE AND THUS I N VIEW OF ABOVE SUBMISSION IT IS PRAYED THAT THE SAME MAY PLEASE BE ALLOWED. THE LD. DR ALSO REITERATED THE SUBMISSIONS AS MADE IN THE WRITTEN SUBMISSIONS. THE SUBMISSIONS OF THE LD. DR ARE REPRODUCED AS UNDER. 1. ENTIRE ARGUMENT OF ASSESEE REVOLVES AROUND THE THE ORY THAT GRANT OF REGISTRATION U/S 12A WOULD AUTOMATICALLY ENTITLE IT FOR EXEMPTION U/S 11. CASE LAWS CITED BY THE ASSESSEE IN THE CASE OF T.N. CRIC KET ASSOCIATION AND DDCA ETC., ARE IN THE CONTEXT OF S. 12A AND ARE INAPPLIC ABLE. 2. DOMAIN OF REGISTRATION U/S 12AA AND ELIGIBILITY FOR EXEMPTION U/S 11 ARE TOTALLY INDEPENDENT & DIFFERENT. AT THE TIME OF REGISTRATI ON, CIT IS NOT EMPOWERED TO LOOK INTO PROVISIONS OF S. 2(15). PROVISIONS OF S. 2(15) ARE REQUIRED TO BE EXAMINED ONLY BY AO AT THE TIME OF ASSESSMENT. THI S HAS BEEN HELD BY HONBLE ITAT JAIPUR IN THE CASE OF RAJ. HSG. BOARD V. CIT (2012) 21 TAMANN.COM 77, RELEVANT EXTRACT OF WHICH IS AS FOLL OWS: AFTER GOING THROUGH THE PROVISIONS OF SECTION 12AA (3) AND SECTION 2(15), WE FOUND THAT BEFORE THE CIT(A) TO WITHDRAWN THE REGISTRATION GRA NTED U/S 12AA HAS BEEN PROVIDED IN SUB CLAUSE (3) OF SECTION 12AA OF THE ACT. THE PROVISI ON OF SECTION 2(15) ARE TOTALLY DIFFERENT. NOW BY THE AMENDED PROVISIONS OF SECTION 2(15) IT H AS BEEN PROVIDED THAT IF ANY YEAR THE GROSS RECEIPTS OF AN INSTITUTION EXCEEDS RS. 10 LAK HS, ( NOW RS. 25 LAKHS W.E.F. 1.4.2012), THEN IN THAT CASE, EXEMPTION U/S 11 MAY NOT BE ALLO WED TO THE INSTITUTION AS THE ACTIVITIES 20 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. OF THE INSTITUTION WILL BE TREATED AS NOT CHARITABL E IF THE RECEIPTS EXCEEDS THE LIMIT. THE EXEMPTION U/S 11 IS TO BE EXAMINED ON YEARLY BASIS, THEREFORE, THE EXEMPTION U/S 11 HAVE NO EFFECT FOR GRANTING REGISTRATION U/S 12AA OF THE ACT. 9.THE OBJECT OF THE INSTITUTION HAS ALREADY BEEN EX AMINED BY THE TRIBUNAL WHO DIRECTED TO GRANT REGISTRATION TO THE PRESENT INSTITUTION. THE RE IS NO DOUBT IN THIS REGARD. THEREFORE, LD. CIT WAS NOT JUSTIFIED IN HOLDING THAT IN VIEW OF AMENDED PROVISIONS OF SECTION 2(15), THE INSTITUTION DOES NOT REMAIN A CHARITABLE INS TITUTION AND, THEREFORE, THE OBJECTIVES OF THE INSTITUTION ALSO DOES NOT REMAIN AS CHARITABLE AND ACCORDINGLY WITHDRAWAL OF REGISTRATION, IN OUR CONSIDERED VIEW, WAS NOT JUSTI FIED. 10.ON SIMILAR FACTS, IN THE CASE OF GUJARAT CRICKET ASSOCIATION, (SUPRA), THE TRIBUNAL BY PASSING A DETAILED ORDER HAS HELD THAT REGISTRATION CANCELLED BY DIT(E) ON THE BASISN OF AMENDED PROVISIONS OF SECTION 2(15) OF THE ACT WAS NOT JUSTIFIED AS AMENDED PROVISIONS DOES NOT FALL WITHIN THE PERMISSIBLE LIMIT OF SECTION 12 AA(3) OF THE ACT AND ACCORDINGLY THE ORDER OF DIT(E) WAS CONSIDERED BAD IN LAW AND THE APPEAL OF THE INSTITUTION WAS ALLOWED. IN THE CASE OF CANE DEVELOPMENT COUNCIL(SUPRA) SIMI LAR VIEW HAS BEEN EPRESSED DOES NOT FALL UNDER THE PROVISIONS OF SECTION 2(15) AND THEREFORE , THE ASSESSEE WAS ENTITLED TO REGISTRATION U/S 12AA OF THE ACT. IN VIEW OF THE DISCUSSION OF OURS AND IN VIEW OF THE DECISION OF TRIBUNAL, WE ARE OF THE VIEW THAT LD. CIT WAS NOT CORRECT IN WITHDRA WING REGISTRATION ALREADY GRANTED BY THE ORDER OF THE TRIBUNAL TO THE INSTITUTION. IF IN ANY YEAR, THE GROSS RECEIPTS OF THE INSTITUTI ON EXCEEDS RS. 10 LAKHS OR RS. 25 LAKHS, AS THE CASE MAY BE, THEN IN THAT YEAR, THE ASSESSING OFFICER IS EMPOWERED TO EXAMINE THE ALLOWABILITY OF EXEMPTION U/S 11 BUT THE SAME HAS NO EFFECT ON GRANTING THE REGISTRATION U/S 12AA OF THE ACT. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD. CIT AND RESTORE THE REGISTRATION ALREADY GRANTED U/S 12AA O F THE ACT. THUS, THE APPEAL OF THE INSTITUTION IS ALLOWED. 3. EVEN WHILE RESTORING REGISTRATION U/S 12A, ITAT ORD ER IN ASSESSEES CASE REQUIRE AO TO EXAMINE ELIGIBILITY FOR EXEMPTION U/S 11 EVEN WHEN REGISTRATION U/S 12A HAS BEEN RESTORED. AT THE TIME OF REGISTRATION, THE LD. CIT HAS TO CON SIDER SECTION 12AA(3) AND HE HAS TO CONSIDER TWO CONDITIONS FOR REJECTION OF REGISTRATION GRANTE D (I) THE ACTIVITIES OF THE TRUST ARE NOT GENUINE, (II) ARE NOT BEING CARRIED OUT IN ACCORDANCE WITH-T HE OBJECT OF THE TRUST AS THE CASE MAY BE. THE LD. CIT HAS NOT FOUND ANY INFIRMITY IN THE ACTIVITI ES CARRIED OUT BY THE RCA AS NON-GENUINE OR NOT BEING CARRIED OUT AS PER OBJECT OF THE TRUST. IT I S ALSO A FACT THAT THE FAME OF CRICKET BECOME VERY POTENTIAL WITH REFERENCE TO REVENUE COMPARED TO OTH ER GAMES, THEREFORE, THE REVENUE GENERATED 21 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. BY THE RCA ARE SUBSTANTIAL BUT THIS GROUND CANNOT B E USED TO CANCEL THE REGISTRATION GRANTED BY THE LD. CIT AS PREDOMINANT OBJECT O THE TRUST IS CH ARITABLE AND SUBSTANTIAL REVIEW GENERATED IS INCIDENTAL TO THE MAIN OBJECT. IF, THE ID ASSESSING OFFICER FOUND ANY VIOLATION IN APPLICATION O FUND, HE CAN MAKE DISALLOWANCE U/S 11 O THE ACT . THUS, WE ARE OF THE CONSIDERED VIEW THAT THE ID CIT WAS NOT RIGHT IN WITHDRAWING THE REGISTRATIO N GRANTED U/S 12A OF THE ACT. 4. THUS AO NEEDS TO EXAMINE IN ASSESSMENT WHETHER PROV ISO TO 2(15) IS ATTRACTED. 5. FOR PROVISOS TO 2(15) TO BE ATTRACTED FOLLOWING CON DITIONS ARE REQUIRED TO BE MET: (A) ASSESSEE SHOULD FALL UNDER THE LIMB ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY TO WHICH CATEGORY ONLY THE SAID PROVISO APPLIES. (B) IF IT IS CARRYING ON AN ACTIVITY IN THE NATURE OF T RADE, COMMERCE OR BUSINESS FOR A CESS OR FEE OR ANY OTHER CONSIDERATION. (C) AGGREGATE VALUE OF SUCH RECEIPTS EXCEEDS RS. 10 LAK H IN THE YEAR. 6. IF 1 ST PROVISO TO 2(15) GETS ATTRACTED, ASSESSEE LOSES BE NEFIT OF EXEMPTION AS PER PROVISIONS OF S. 13(8) 7. THEREFORE, ONLY QUESTION TO BE DECIDED IS AS TO WHE THER ASSESSEE WAS ENGAGED IN COMMERCIAL ACTIVITY FOR A FEE OR OTHER C ONSIDERATION. 8. NATURE O RECEIPT IN THE HANDS OF ASSESSEE IS BY WAY OF SHARING OF SPONSORSHIP AND MEDIA RIGHTS WITH BCCI AS WELL AS MATCH REVENUE FOR CONDUCTING VARIOUS CRICKET MATCHES. IT MAY BE SEEN THAT IN A.Y. 2008- 09(TABLE AT PG 14 OF ASSESSMENT ORDER), THE ASSESSEE HAS EARNED SURPLUS OF RS. 5.88 CRORES OUT O RECEIPTS IN THE SHAPE OF ADVERTISEMENT, CANTEEN & T ICKETS OF RS. 7.81 CRORES, WHICH AMOUNTS TO SUPERNORMAL PROFIT. 9. THEREFORE, INCOME OF ASSESSEE FROM SUBSIDY IS NOT HING BUT A PERCENTAGE OF FEE GATHERED FROM PUBLIC FOR MATCHES AND PERCENTAGE OF ADVERTISEMENT RECEIPTS WHILE CONDUCTING MATCHES. 10. ONCE PROVISOS TO 2(15) ARE ATTRACTED, ASSESSEE LOSES BENEFIT OF EXEMPTION U/S 11 AS PER S. 13(8) AND ENTIRE INCOME BECOMES TAXABL E. KINDLY SEE PB 16 OF ASSESSEES PAPER BOOK OF A.Y. 2008-09 WHERE MATCH R ECEIPTS ARE SHOWN. SNO. 11 & 12 SHOW SALE OF TICKETS FOR AS HIGH AS RS. 30, 000 & RS. 1,00,000/-. ACCORDING TO WIKIPEDIA, TRADE/COMMERCE INVOLVES TRA NSFER OF GOODS AND/ OR SERVICES FROM ONE PERSON OR ENTITY TO ANOTHER, OFTE N IN EXCHANGE FOR MONEY. THE NATURE OF RECEIPTS IN THE HANDS OF THE ASSESSEE CERTAINLY WOULD ALL UNDER TRADE & COMMERCE AS UNDERSTOOD IN COMMON PARLANCE . ONCE THE RECEIPTS ARE COMMERCIAL IN NATURE AND SUCH RECEIPTS EXCEED THE THRESHOLD OF RS. 10 LAKHS (BOTH CONDITIONS SATISFIE D IN ASSESSEES CASE), THE ASSESSEE WOULD BE HIT BY PROVISO TO S. 2 (15). THE SAID PROVISO STIPULATED THAT ADVANCEMENT OF ANY OTHER O BJECT OF GENERAL PUBLIC UTILITY SHALL NOT BE CHARITABLE PURPOSE IF I T INVOLVES CARRYING ON OF ANY ACTIVITY IN THE NATURE OF TRADE AND COMMERCE OR BUSINESS OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATION T O ANY TRADE, COMMERCE OR BUSINESS FOR A CESS OR FEE OR ANY OTHER CONSIDERATION, 22 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. IRRESPECTIVE OF THE NATURE OF USE OR APPLICABLE OF RETENTION OF THE INCOME FROM SUCH ACTIVITY. ONCE PROVISO TO 2(15) IS ATTRACTED, THE ASSESSEE SHALL NOT BE A CHARITABLE ORGANIZATION IRRESPECTIVE OF WHETHER IT IS REGISTER ED U/S 12A. THUS, HAVING REGISTRATION U/S 12A DOES NOT AUTOMATICALLY TRANSLATE INTO ELIGIBILITY FOR EXEMPTION U/S 11 & 12, WHICH HAS TO BE EXAMINED BY THE AO FROM YEAR TO YEAR IN THE LIGHT OF S. 2(15). HAD IT BEEN SO, THE PROVISO TO S. 2(15) WOULD BE RENDERED REDUNDANT, SINCE CIT IS ALSO NOT EMPOWERED TO EXAMINE THE CASE OF THE ASSESSEE IN THE LIGHT OF PROVISO TO S. 2(15) WH ILE GRANTING REGISTRATION U/S 12A. THUS, GRANT OF REGISTRATION U/S 12A DOES NOT PRECLUDE THE AO FROM EXAMINING THE CASE OF THE ASSESSEE IN THE LIGHT OF THE SAID PROVISO AND IF HE FINDS THAT THE ASSESSEE IS HIT BY THE PROVISO THEN THE ASSESSEE WILL CEASE TO BE A CHARITABLE ORGANIZATION. IN THE CASE OF ENTERTAINMENT SOCIETY OF GOA V. CIT (2013) 34 TAMAN N. COM 210 (PANJI), THE ITAT HAS HELD THAT AMOUNTS RECEIVED BY ASSESSE E BY WAY OF SPONSORSHIP AND OTHER EVENTS WERE HIT BY PRO VISO TO S.2(15). THE HEAD NOTE IS AS FOLLOWS: SECTION 2(15) OF THE INCOME-TAX ACT, 1961- CHARITAB LE PURPOSE [ PROVISO]- ASSESSMENT YEAR 2009-10- WHETHER TO ATTRACT PROVISO TO SECTION 2(15 ) INSERTED BY FINANCE ACT, 2008, INSTITUTION NEED NOT ACTUALLY BE CARRYING ON TRADE, COMMERCE OR BUSINESS BUT ACTIVITY CARRIED ON BY IT IS TO BE SIMILAR TO TRADE, COMMERCE OR BUS INESS EVEN WITHOUT PROFIT MOTIVE- HELD, YES WHETHER FOR DETERMINING WHETHER ASSESSEE IS ENGAG ED IN CHARITABLE PURPOSE IN VIEW OF AMENDED SECTION 2(15), USE OR APPLICABLE OR RETENTI ON OF CONSIDERATION RECEIVED IS NOT RELEVANT AT ALL- HELD, YES WHETHER SECTION 2(15) DOES NOT PROVIDE ANY EXCEPTION UNDER PROVISO TO A REGULATORY BODY OR A BODY INCORPORATED BY STATE GOVERNMENT OR CENTRAL GOVERNMENT HELD, YES [PARA15] [IN FAVOUR OF REVEN UE] SECTION 2(15) OF THE INCOME-TAX ACT, 1961 CHARITABLE PURPOSE [ REGISTRATION OF] AS SESSMENT YEAR 2009-10 MAIN ACTIVITY OF ASSESEE-TRUST WAS TO ORGANIZE AND HOST INTERNATIONA L FILM FESTIVALS AND TO BUILD MULTIPLEXES, CINEMA HALLS, MEDIA CENTERS, SCREENING ROOMS, AUDIT ORIUMS, COMPREHENSIVE INFRASTRUCTURE FACILITIES ,ETC., FOR HOLDING SUCH EVENTS ALL SER VICES PROVIDED BY IT WERE FOR CONSIDERATION WHETHER AMOUNTS RECEIVED BY ASSESSEE BY WAY OF SPON SORSHIP, ADMINISTRATIVE CHARGES, LISTING OF HOTELS ON THEIR WEBSITE, CONDUCTING FILM APPRECI ATION COURSE CLEARING REPRESENTED RECEIPTS FROM ACTIVITY OF RENDERING SERVICES IN RELATION TO TRADE, COMMERCE OR BUSINESS AND AFTER INSERTION OF PROVISO IN SECTION 2(15), ASSESSEE COU LD NOT BE REGARDED TO HAVE BEEN ESTABLISHED FOR CHARITABLE PURPOSE- HELD, YES 23 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. SINCE THE RECEIPTS OF THE ASSESSEE ARE SIMILAR IN N ATURE, THESE WOULD FALL UNDER THE CATEGORY OF COMMERCIAL RECEIPTS. THE CASE OF TH E ASSESEE IS DISTINGUISHABLE FROM THE CASE OF ICAI CITED BY THE ASSESSEE SINCE RECEIPTS OF ICAI ARE BASICALLY FROM MEMBERS ( AND NOT PUBLIC AS IN CASE OF ASSESSEE) AND DO NOT EXPLOIT ANY COMMERCIAL/ADVERTISEMENT /TV RIGHTS AS IN THE CASE OF ASSESSEE. ONE TEST OF COMMERCIALITY OF RECEIPT IS WHETHER RECEIPTS ARE AT MARKET RATES AND ARE OPEN TO SUBSCRIPTION BY GENERAL PUBLIC AS OPPOSED TO A SELECT FEW MEMBERS. SIMILARLY IN T HE CASE OF AHEMDABAD URBAN DEVELOPMENT AUTHORITY V. CIT (2016) 69 TAXMANN. COM 381, THE ITAT, AHEMDABAD HAS RECENTLY HELD IN THIS CONTEXT OF S. 2(15), AS FOLLOWS: SECTION 2(15) OF THE INCOME TAX ACT, 1961 CHARITA BLE PURPOSE ( OBJECT OF GENERAL PUBLIC UTILITY) ASSESSMENT YEARS 2009-10 TO 2011-12- ASSES SEE- AUTHORITY WAS ENGAGED IN EXECUTING TOWN PLANNING SCHEME IN TERMS OF TOWN PLANNING ACT IT FILED ITS RETURN DECLARING TAXABLE INCOME AT NIL IN COURSE OF ASSESSMENT, ASSESSING OFFICER CALLED FOR DETAILS OF PURCHASES, SALES AND PREMIUM CHARGED IN RESPECT OF LEASING OUT OF LAND- ON ANALYSIS OF DETAILS SO SUBMITTED , ASSESSING OFFICER NOTED THAT ASSESSEE H AD BEEN CHARGING HIGH PREMIUM WHICH INDICATED PROFIT MOTIVE EVEN AT PLANNING LEVEL- HE THUS HELD THAT ASSESSEES ACTIVITIES DID NOT QUALIFY DEFINITION OF CHARITABLE PURPOSE IN TERMS OF PROVISO TO SECTION 2(15)- IT WAS FOUND FROM RECORD THAT IN TERMS OF TOWN PLANNING SCHEME, ASSESSEE USED TO HOLD 15 PERCENT OF TOTAL LAND EARMARKED FOR DEVELOPMENT WHICH WAS LATER ON O LD IN AUCTION TO HIGHEST BIDDER- IT WAS UNDISPUTED THAT AFORESAID ACTIVITY WAS CARRIED OUT WITH PROFIT MOTIVE AND AS A RESULT RESERVES AND SURPLUS OF ASSESSEE WERE CONTINUOUSLY SWELLING WHETHER ON FACTS, IMPUGNED ORDER PASSED BY ASSESSING OFFICER DID NOT REQUIRE ANY INT ERFERENCE HELD, YE [ PARA 26 11. ONCE PROVISOS TO 2(15) ARE ATTRACTED, ASSESSEE LOSES BENEFIT OF EXEMPTION U/S 11 AS PER S. 13(8), AND ENTIRE INCOME BECOMES TAXABLE. 12. GROUND 4.4 OF ASSESSEE IS REGARDING ADDITION OF RS. 1.5 CRORE DONATION TO CORPUS FUND. CIT (A) AT PARA 7 HAS OBSERVED THAT NO DETAIL S WERE SUBMITTED IN THIS REGARD BY THE ASSESSEE. FOR S. 11(1) (D) TO OPERATE SO A TO EXCLUDE CORPUS DONATIONS FROM INCOME FOLLOWING CONDITIONS NEED TO BE SATISFIED, REGARDLESS OF WHETHER IT IS REGISTERED U/S 12A: (A) DONATIONS SHOULD BE VOLUNTARY (B) THEY SHOULD BE MADE WITH SPECIFIC DIRECTION THAT TH EY SHALL FORM PART OF CORPUS. THE ASSESSEE HAS NOT ADDUCED ANY EVIDENCE SHOWING T HAT BOTH CONDITIONS ARE SATISFIED. 24 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. 13. GROUND 5 OF ASSESSEE IS REGARDING DISALLOWANCE OF RS. 50 LAKH. HERE AGAIN THERE IS TOTAL ABSENCE OF DETAILS IN BOTH ASSESSMEN T AS WELL AS APPELLATE STAGES. 4. WE HAVE CONSIDERED, THE RIVAL CONTENTIONS, PERUS ED THE MATERIAL AVAILABLE RECORDS. THE ONLY ISSUE TO BE EXAMINED UNDER THE FA CTS OF THE PRESENT CASE IS WHETHER THE ASSESSING OFFICER WAS JUSTIFIED IN DECL INING THE CLAIM OF THE DEDUCTION U/S 11 OF THE ACT. THE ASSESSING OFFICER HOWEVER OB SERVED THAT A PERUSAL OF THE FINANCIAL FIGURES REVEALS THAT THE APPLICANT HAS GE NERALLY ACCUMULATED SURPLUS U/S 11(2) OF THE ACT IN LAST 4 OR 5 YEARS, WHICH INDICA TE THAT THE ASSESSEE IS EARNING HUGE SURPLUS FROM THE ACTIVITIES CARRIED OUT BY IT. THE ASSESSING OFFICER FURTHER OBSERVED THAT THE ASSESSEES INVESTMENT IS INCREASING, THIS SHOWS THAT THE ASSESSEE IS CONVERTING THE SURPLUS INTO INVESTMENT WHICH IN TU RN HAS STRENGTHENED ITS CAPACITY TO EARN MORE. THEREFORE, HE CONCLUDED THAT THE ASS ESSEE EXIST FOR PURPOSE OF EARNING PROFIT AND THE APPLICANT IS NOT PROMOTING S PORTS ON NON-PROFIT BASIS. THE ASSESSING OFFICER FURTHER OBSERVED THAT THAT THE AS SESSEE HAD BUILT A PREMISES IN THE NAME OF RAJASTHAN CRICKET ACADEMY, WHICH HAS BEEN G IVEN ON RENT TO A SERVICE PROVIDER ON A MONTHLY RENT OF RS. 75,000/-. THE AGR EEMENT EXECUTED WITH THE SERVICE PROVIDER STATES THAT BOOKING FOR 28 ROOMS W ILL BE MADE THROUGH SERVICE PROVIDER. THE ASSESSING OFFICER REPRODUCED THE CLA USE 2.2.1 OF THE AGREEMENT AND INFERRED THAT THE SAID CLAUSES LEAVE NO DOUBT FOR THE COMMERCIAL EXPLOITATION OF THE PROPERTY BY THE SERVICE PROVIDER UNDER THE DIRECT C ONTROL OF THE RCA. HE OBSERVED THAT IN THE PRESENT CASE THE SERVICE PROVIDER IS PA YING TO THE RCA FOR USING THE PREMISES AS HOTEL. IT IS CLEAR FOR THE SAME THAT T HE MOTIVE OF RCA IS TO MAXIMIZE THE PROFIT. HE OBSERVED THAT RCA IS GENERATING HUGE PRO FIT YEAR AFTER YEAR AND ITS 25 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. EXPENDITURE ON SPORTS PROMOTION COACHING MAINTENANC E OF PREMISES AND FACILITIES ETC. IS VERY LOW. THE ASSESSING OFFICER FURTHER OB SERVED THAT THERE IS NO DENIAL THAT THE OBJECT OF THE ASSESSESS INSTITUTION IS PROMOTI ON OF SPORTS WHICH AS PER CBDT CIRCULAR IS CHARITABLE PURPOSE. BUT THE ACTIVITIES UNDERTAKEN BY THE RCA CLEARLY SHOWS THAT THE MAIN ACTIVITY IS COMMERCIAL EXPLOITA TION OF PUBLIC CRAZE OVER CRICKET. THE ASSESSING OFFICER PLACED RELIANCE ON THE JUDGME NT OF THE HONBLE CALCUTTA HIGH COURT RENDERED IN THE CASE OF CRICKET ASSOCIATION O F BENGAL VS. COMMISSIONER OF INCOME TAX 371 ITR 277. 5. IT IS OBSERVED BY THE AO THAT THE ENTIRE CHARACT ER AND FOCUS OF THE RCA HAS BECOME TOTALLY COMMERCIAL. THEREFORE, THE ASSESSIN G OFFICER PROCEEDED TO DISALLOW EXPENDITURE AND THE EXEMPTION CLAIMED BY THE ASSESS EE. THUS, THE EXEMPTION WAS DENIED ON THE BASIS THAT THE ASSESSEE WAS INVOLVED INTO A COMMERCIAL ACTIVITY. THE LD. CIT(A) CONCURRED THE VIEW OF THE ASSESSING OFFI CER ON THE SAME BASIS. BEFORE ADVERTING TO THE RIVAL CONTENTIONS IT WOULD BE APPR OPRIATE TO REPRODUCE THE RELEVANT PROVISION OF LAW. THE SECTION 2(15) OF THE INCOME T AX ACT THAT DEFINES CHARITABLE PURPOSE WHICH IS REPRODUCED AS UNDER: SECTION 2(15) - CHARITABLE PURPOSE INCLUDE RELIE F OF THE POOR, EDUCATION, MEDICAL RELIEF, [PRESERVATION OF ENVIRONMENT( INCLU DING WATERSHEDS, FORESTS AND WILDLIFE) AND PRESERVATION OF MONUMENTS OR PLAC ES OR OBJECTS OF ARTISTIC OR HISTORIC INTEREST] AND THE ADVANCEMENT O ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY. PROVIDED THAT THE ADVANCEMENT OF ANY OTHER OBJECT OF GENERA L PUBLIC UTILITY SHALL NOT BE A CHARITABLE PURPOSE, IF IT INVOLVES T HE CARRYING ON OF ANY ACTIVITY IN THE NATURE O TRADE, COMMERCE OR BUSINESS, OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSIN ESS, OR A CESS OR FEE OR ANY OTHER CONSIDERATION, IRRESPECTIVE OF THE NATURE OF USE OR APPLICATION, OR RETENTION, OF THE INCOME FROM SUCH ACTIVITY:] [PROVIDED FURTHER THAT THE FIRST PROVISO SHALL NOT APPLY IF THE AGGR EGATE VALUE OF THE RECEIPTS FROM THE ACTIVITIES REFERRED TO THEREIN IS TEN LAKH RUPEES OR LESS IN THE PREVIOUS YEAR: ] 26 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. THE REVENUE HAS HEAVILY RELIED UPON THE AFOREMENTI ONED PROVISION. IT IS STATED THAT THE ACTIVITY OF THE ASSESSEE TRUST FALLS WITHIN THE CATEGORY OF GENERAL PUBLIC UTILITY. THEREFORE, THE PROVISO TO SECTION 2(15) WOULD COME INTO PLAY. IT IS SUBMITTED THAT THE LOOKING TO THE QUANTUM VOLUME AND NATURE OF REC EIPT GOES TO DEMONSTRATE THAT THE ASSESSEE IS ENGAGED INTO COMMERCIAL ACTIVITY AN D FOR THE PURPOSES OF MAKING PROFIT. PER CONTRA IT IS CONTENDED THAT THE ASSESSE E IS AN ASSOCIATION REGISTERED UNDER RAJASTHAN SPORTS (REGISTRATION, RECOGNITION AND REG ULATION OF ASSOCIATION) ACT, 2005 AND FORMED WITH OBJECTIVE OF PROMOTING OF SPORT OF CRICKET WITHIN THE STATE OF RAJASTHAN. RCA, UNDER A MEMORANDUM OF UNDERSTANDING WITH RAJASTHAN STATE COUNCIL HAS EXCLUSIVE USE AND POSSESSION OF SWAI MA NSINGH STADIUM FOR THE PURPOSE OF ORGANIZING NATIONAL AND INTERNATIONAL MATCHES. THE MAIN OBJECT OF THE ASSOCIATION IS TO CONTROL, SUPERVISE, REGULATE, OR ENCOURAGE, P ROMOTE AND DEVELOP THE GAME OF CRICKET IN THE AREAS UNDER THE JURISDICTION OF ASSO CIATION ON NO PROFIT OR NO LOSS BASIS. IT IS CONTENTED THAT THE ASSESSEE WAS HOLDING REGIS TRATION UNDER SECTION 12A OF THE ACT WITH EFFECT FROM 25 TH NOV. 1988, AND THUS WAS CLAIMING EXEMPTION U/S 11 ON THIS BASIS. THE LD. CIT, WITHDREW THE REGISTRATION UNDE R SECTION 12A OF THE INCOME TAX ACT, PERTAINING TO THE ASSESSMENT YEAR 2005-06 ONWA RDS. HOWEVER, ON APPEAL TO THE TRIBUNAL THE ISSUE OF REGISTRATION WAS SET ASID E TO THE LD. CIT TO DECIDE IT AFRESH. THE LD. CIT AGAIN WITHDREW REGISTRATION UNDER SECTI ON 12A. HOWEVER, THE REGISTRATION WAS GRANTED IN ITA NO. 544/JP/2013. OUR ATTENTION WAS DRAWN TO THE ASSESSEES PAPER BOOK PAGE NOS. 13 TO 30. IT IS CONTENDED THA T SECTION 11 OF THE INCOME TAX ACT PROVIDES EXEMPTION IN RESPECT OF INCOME OF CHAR ITABLE OR RELIGIOUS TRUSTS IF THE 27 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. SAME IS APPLIED TOWARDS THE OBJECTS OF THE TRUSTS. IT IS THE CONTENTION OF THE ASSESSEE THAT THE SOLE BASIS OF DECLINING EXEMPTION WAS THAT THERE WAS HUGE SURPLUS EARNED BY THE ASSESSEE IN RESPECT OF ONE-DAY INTERN ATIONAL MATCH HELD BETWEEN INDIA AND PAKISTAN. IT IS THE CONTENTIONS OF THE A SSESSEE THAT A MATCH BETWEEN INDIA AND PAKISTAN ALWAYS GENERATES HIGHER RECEIPTS AS TH E NUMBER OF AUDIENCE IS HIGHER. IT IS ALSO POINTED OUT THAT THE MATCH BETWEEN OTHER COUNTRIES COULD NOT EVEN FETCH 70 TO 80% OF THE COLLECTION. IT IS ALSO CONTENDED THAT ALL THE PAYMENTS IN THE SHAPE OF SPONSORSHIP, ADVERTISEMENT, TV RIGHTS ETC. ARE R ECEIVED DIRECTLY BY BCCI. FURTHER, BCCI DELEGATES THE ORGANIZATION OF MATCHES TO STATE ASSOCIATION AND IN TURN STATE ASSOCIATION GETS SOME FUNDS FROM PROMOTION AN D EXPANSION OF THEIR CHARITABLE ACTIVITIES. IT IS ALSO SUBMITTED THAT MAJOR BENEFI TS BY ORGANIZING THESE MATCHES IS THAT LOCAL TEAM, BEING TRAINED BY THE RCA, GET OPP ORTUNITY TO LEARN FROM EXPERIENCE OF COACHES OF INTERNATIONAL LEVEL BY ASSISTING THEM DURING PRACTICE MATCHES AND BY WITNESSING THE MATCHES PLAYED BY THE INTERNATIONAL PLAYERS, BY SPENDING TIME WITH THEM ETC. IT IS SUBMITTED THAT ORGANIZING SUCH MAT CHES RESULTS INTO THE PROMOTION OF SPORTS OF CRICKET SURPLUS IF ANY GENERATED IS PURE LY INCIDENTAL IN NATURE AND THE ASSESSEE CANNOT BE DEEMED TO CARRY OUT ACTIVITY IN NATURE OF TRADE, COMMERCE OR BUSINESS. IT IS ALSO CONTENDED THAT THE ASSOCIATIO N HAS BEEN ORGANIZING MATCHES IN THE REMOTE AREAS IN RAJASTHAN. IT IS SUBMITTED THA T THE ASSESSING OFFICER OBSERVED THAT THE ASSOCIATION WAS INVOLVING INTO COMMERCIAL ACTIVITIES AND THE SOCIETY HAD ACCUMULATED OF SURPLUS INCREASE IN THE INVESTMENT, CONTROL OVER THE PLAYERS BY OBSERVING THIS HOWEVER, HE FAILED TO APPRECIATE THA T NORMALLY THE SURPLUS WAS THE RESULT OF SUBSIDIES ONLY AND NOT FROM THE CONDUCTIN G OF TOURNAMENT ON COMMERCIAL 28 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. BASIS. THE SUBSIDIES ARE A FORM OF FINANCIAL AID G RANTED FOR PROMOTING A SPECIFIC CAUSE, WHICH IS ULTIMATELY FOR THE BENEFIT OF OVE RALL SECTION OF PUBLIC BUT NEVER OR THE BENEFIT OF AN INDIVIDUAL ORGANIZATION. IT IS C ONTENDED THAT THE SUBSIDY RECEIVED BY THE RCA IS UTILIZED IN THE PROMOTION AND DEVELOP MENT OF SPORTS OF CRICKET IN STATE AT EACH LEVEL, I.E. FROM MUFASILS AREAS TO BIG CITI ES LIKE JAIPUR. IT IS ALSO CONTENDED THAT RENTING OUT BY PREMISE BY RCA HAS BEEN VIEWED ADVERSELY IN THE CONTEXT IT WAS SUBMITTED THAT RCA IS FORMED WITH A SOLE OBJECTIVE OF PROMOTING CRICKET AND WITH THE VIEW TO ACHIEVE THE DESIRED OBJECTIVE THE RENTING O F PREMISES AS DONE IS WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF CRICKET AND NO OTHER ACTIVITY OF WHATSOEVER NATURE HAS BEEN CARRIED OUT NEITHER IT IS ENGAGED IN THE SYSTE MATIC ACTIVITY AS HOTELIER. THUS, THE MAIN ACT OF ASSOCIATION IS FULLY IN THE DIRECTION O F ACHIEVING ITS BASIC OBJECT OF PROMOTING CRICKET. IT IS CONTENDED THAT RCA IS PRO VIDE TECHNICAL AND FINANCIAL SUPPORT TO THE ALL DISTRICT CRICKET ASSOCIATION I. E. PROVIDING EQUIPMENTS, NETS, BALLS, ETC. WITHOUT ANY CONSIDERATION ON OTHER SIDE RCA IS GETTING ONLY AFFILIATION FEE FROM THEM WHICH IS VERY NOMINAL (RS. 200/- ONLY). THE RC A HAS PROVIDING GRANTS TO DISTRICTS OF A SUBSTANTIAL AMOUNT OF RS. 39,20,763/ -. RCA IS ORGANIZING VARIOUS MATCHES OF NATIONAL LEVEL TOURNAMENTS LIKE RANJI TR OPHY, IRANI TROPHY, DILIP TROPHY, MAHARANA BHAGWAT SINGH TROPHY, SALIM DURRANI TROPHY ETC., WITHOUT HAVING ANY SURPLUS RATHER THESE WERE ORGANIZED FOR THE DEVELOP MENT OF GAME OF CRICKET AT NATIONAL LEVEL AND TO IDENTIFY THE PLAYERS WHO CAN REPRESENT THE COUNTRY AT INTERNATIONAL LEVEL AND IN THE YEAR 2007-08 RCA HAS MADE EXPENDITURE OF OVER RS. 1.12 CRORES. IT IS CONTENDED THAT THE SURPLUS IF A NY GENERATED BY THE ASSESSEE BY THE ASSESSEE WAS MERELY INCIDENTAL TO THE MAIN OBJE CT THAT IS PROMOTION OF SPORT OF 29 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. CRICKET AND IN NO WAY BY RUNNING BUSINESS OF CRICKE T AS HAS BEEN ALLEGED BY THE REVENUE. WE FIND THAT THE HONBLE MADRAS HIGH COURT UNDER T HE IDENTICAL FACTS, IN THE CASE OF TAMIL NADU CRICKET ASSOCIATION VS THE DIRECTOR OF I NCOME TAX(E) HAS HELD: AS SEEN FROM THE OBSERVATION OF THE INCOME TAX APP ELLATE TRIBUNAL, ALTHOUGH GENERALLY IT ACCEPTED THE CASE OF THE ASSESSEE THAT THE PHYSICAL ASPECT OF THE GAME WAS ONE IN ACCORDANCE WITH THE OBJECTS, THE QU ANTUM OF RECEIPTS APPARENTLY LED THE INCOME TAX APPELLATE TRIBUNAL AN D THE REVENUE TO COME TO THE CONCLUSION THAT THE ACTIVITIES ARE COMMERCIA L AND HENCE BY SECTION 2(15) PROVISO TO THE ACT, THE RECEIPT FROM BCCI COU LD NOT BE CALLED AS SUBSIDY. AS FOR THE OBSERVATION OF THE INCOME TAX APPELLATE TRIBUNAL THAT THE TWIN CONDITIONS STOOD SATISFIED IS CONCERNED, IT IS NOT DENIED BY THE REVENUE THAT AT THE TIME OF GRANTING REGISTRATION, THE COMMISSIONER HAD SATISFIED HIMSELF ABOUT THE OBJECTS OF THE RUST AND THE GENUINENESS O F THE ACTIVITIES AS FALLING WITHIN THE MEANING OF CHARITABLE PURPOSE, AS IT S TOOD IN 2003. THE REVENUE DOES NOT DENY AS A MATTER OF FACT THAT THE OBJECTS REMAIN AS IT WAS IN 2003 AND THERE IS NO CHANGE IN ITS CONTENT TO CALL THE A SSESSEES OBJECT AS NOT GENUINE. THERE ARE NO MATERIALS TO INDICATE THAT T HE GRANT OF REGISTRATION WAS NOT BASED ON MATERIAL INDICATING OBJECT OF GENERAL PUBLIC UTILITY. THE ASSESSEE IS A MEMBER OF BOARD OF CONTROL OF CRI CKET IN INDIA (BCCI), WHICH IN TURN IS A MEMBER OF ICC (INTERNATI ONAL CRICKET COUNCIL). BCCI ALLOTS TEST MATCHES WITH VISITING FOREIGN TEAM AND ONE DAY INTERNATIONAL MATCHES TO VARIOUS MEMBER CRICKET ASSOCIATION WHICH ORGANIZE THE MATCHES IN THEIR STADIA. THE FRANCHISEES CONDUCT MATCHES IN T HE STADIA BELONGING TO THE STATE CRICKET ASSOCIATION. THE STATE ASSOCIATION I S ENTITLED TO ALL IN-STADIA SPONSORSHIP ADVERTISEMENT AND BEVERAGE REVENUE AND IT INCURS EXPENSES FOR THE CONDUCT O THE MATCHES. BCCI EARNS REVENUE BY W AY OF SPONSORSHIP AND MEDIA RIGHT AS WELL AS FRANCHISEE REVENUE FOR IPL A ND IT DISTRIBUTES 70% OF THE REVENUE TO THE MEMBER CRICKET ASSOCIATION. THUS TH E ASSESSEE IS ALSO THE RECIPIENT OF THE REVENUE. THUS, FOR INVOKING SECTI ON 12AA READ WITH SECTION 2(15) OF THE ACT, REVENUE HAS TO SHOW THAT THE ACTI VITIES ARE NOT FITTING WITH THE OBJECTS OF THE ASSOCIATION AND THAT THE DOMINAN T ACTIVITIES ARE IN THE NATURE OF TRADE, COMMERCE AND BUSINESS. WE DO NOT THINK THAT BY THE VOLUME OF RECEIPT ONE CAN DRAW THE INFERENCE THAT THE ACTI VITY IS COMMERCIAL. THE INCOME TAX APPELLATE TRIBUNALS VIEW THAT IT IS AN ENTERTAINMENT AND HENCE OFFENDED SECTION 2 (15) OF THE ACT DOES NOT APPEAR TO BE CORRECT AND THE SAME IS BASED ON ITS OWN IMPRESSION ON FREE TICKET, PAYMENT OF ENTERTAINMENT TAX AND PRESENCE OF CHEER GROUP AND GIVEN THE IRREL EVANT CONSIDERATION. THESE CONSIDERATIONS ARE NOT GERMANE IN CONSIDERING THE QUESTION AS TO WHETHER THE ACTIVITIES ARE GENUINE OR CARRIED ON IN ACCORDANCE WITH THE OBJECTS OF THE ASSOCIATION. WE CAN ONLY SAY THAT T HE INCOME TA APPELLATE TRIBUNAL RESTED ITS DECISION ON CONSIDERATION WHICH ARE NOT RELEVANT OR 30 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. CONSIDERING THE TEST SPECIFIED UNDER SECTION 12AA(3 ) TO IMPOSE COMMERCIAL CHARACTER TO THE ACTIVITY OF THE ASSOCIATION. IN T HE CIRCUMSTANCE, WE AGREE WITH THE ASSESSEE THAT THE REVENUE HAS NOT MADE OUT ANY GROUND TO CANCEL THE REGISTRATION UNDER SECTION 12AA(3) OF THE ACT. THE LD. DR HAS STRONGLY RELIED ON THE DECISION OF T HE COORDINATE BENCH IN THE CASE OF RAJASTHAN HOUSING BOARD VS. CIT 21 TAXMANN.COM 77 AND ALSO DECISION IN THE CASE OF AHEMDABAD URBAN DEVELOPMENT AUTHORITY VS. CIT(2 016) 69 TAXMANN.COM 381 AND ALSO THE DECISION OF COORDINATE BENCH IN THE CA SE OF ENTERTAINMENT SOCIETY OF GOA VS. CIT 34 TAXMANN.COM (210) (PANJI) SO FAR AS THE DECISION OF THE COORDINATE BENCH IN THE CASE OF RAJASTHAN HOUSING BOARD AND AH EMDABAD URBAN DEVELOPMENT AUTHORITY ARE CONCERNED ARE NO MORE BINDING PRECEDE NTS IN VIEW OF THE SUBSEQUENT JUDGMENT OF HONBLE JURISDICTIONAL HIGH COURT IN TH E JODHPUR DEVELOPMENT AUTHORITY RENDERED IN THE CASE OF CIT VS. JODHPUR DEVELOPMENT AUTHORITY 287 ITR 473(RAJ.) 6. THE ALLEGATIONS OF THE ASSESSING OFFICER IS THAT IN THE CASE OF ASSESSEE THE MAJOR INCOME ARISE NOT FROM THE GAME OF CRICKET BUT FROM THE BUSINESS OF CRICKET. IT IS ALLEGED BY THE ASSESSING OFFICER THAT MAJOR SOUR CE OF INCOME ARE FROM TV SUBSIDY, SALE OF ADVERTISEMENT, SURPLUS FROM ONE-DAY INTERNA TIONAL BETWEEN INDIA AND PAKISTAN INCOME FROM RCA CRICKET ACADEMY AND INTERE ST INCOME. ALL THESE ACTIVITIES ARE MORE IN THE NATURE OF BUSINESS OF CRICKET THAN THE PROMOTION OF GAME OF CRICKET. AS PER AO, THOUGH, THE WORD BUSINESS IS NOT DEFIN ED IN THE INCOME TAX ACT. IT HAS BEEN HELD TO POSTULATE THE EXISTENCE OF CERTAIN ELE MENTS IN THE ACTIVITY OF ASSESSEE, WHICH WOULD INVEST IT WITH THE CHARACTER OF BUSINES S SUCH MOTIVE MUST PERVADE THE WHOLE SERIES OF TRANSACTION EFFECTED BY THE PERSON IN COURSE OF HIS ACTIVITY. THE CHARACTERISTIC OF VOLUME, FREQUENCY TO CONTINUITY A ND REGULARITY OF THE ACTIVITY 31 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. ACCOMPANIED BY PROFIT MOTIVE. ON THE PART OF THE A SSESSEE HAVE BEEN HELD TO INDICATE AN INTENTION TO CONTINUE THE ACTIVITY AS B USINESS. IN THIS BACK-DROP OF ALLEGATION WE NEED TO EXAMINE WHETHER THE ALLEGATIO N OF THE ASSESSING OFFICER IS IN CONSONANCE WITH THE STATUTORY PROVISION GOVERNING T HE ISSUE AND JUDICIAL PRONOUNCEMENT MADE IN THIS RESPECT. THE REVENUE HA S NOT DOUBTED THAT THE ASSESSEE HAS CONDUCTED MATCHES OF THE CRICKET. THE ONLY SUSPICION WITH REGARD TO THE ACTIVITY IS THAT DURING THE ONE-DAY INTERNATION AL PLAYED BETWEEN INDIA AND PAKISTAN, THERE WAS HUGE SURPLUS AND THE ASSESSEE H AD RENTED OUT ROOMS TO BELONGING TO THE SOCIETY AT A VERY HIGHER RATE. TH EREFORE, IT CAN BE INFERRED THAT THE ASSESSING OFFICER IS SWAYED BY THE VOLUME OF RECEIP TS. THESE IDENTICAL FACTS, WERE ALSO BEFORE THE HONBLE MADRAS HIGH COURT IN THE CA SE OF TAMIL NADU CRICKET V. THE DIRECTOR OF INCOME TAX(E)(SUPRA) WHEREIN THE HONBL E COURT OPINED THAT BY THE VOLUME OF RECEIPT INFERENCE THAT ACTIVITY IS COMMER CIAL CANNOT BE DRAWN. IT WAS OBSERVED BY THE HONBLE HIGH COURT, THAT THE BASIS OF THE DECISION OF THE TRIBUNAL WAS ON IRRELEVANT CONSIDERATION. IT WAS HELD THAT T HESE CONSIDERATIONS ARE NOT GERMANE IN CONSIDERING THE QUESTION WHETHER THE ACT IVITIES ARE GENUINE OR CARRIED ON WITH THE OBJECT OF THE ASSOCIATION. IT IS ALSO NOTEWORTHY THAT AS PER SECTION 11(4A) SU BSTITUTED BY THE FINANCE ACT, 1983 WITH EFFECT FROM 1/4/1984 SUB SECTION 1 OR SUB SECT ION 2 OR SUB SECTION 3 OR SUB SECTION 3A SHALL NOT APPLY IN RELATION TO ANY INCOM E OF A TRUST OR AN INSTITUTION, BEING PROFIT AND GAINS OF BUSINESS, UNLESS THE BUSINESS I S INCIDENTAL TO THE ATTAINMENT OF THE OBJECTIVES OF THE TRUST OR, AS THE CASE MAY BE INSTITUTIONS AND SEPARATE BOOKS OF ACCOUNTS ARE MAINTAINED BY SUCH TRUST OR INSTITUTIO N IN RESPECT OF SUCH BUSINESS. 32 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. NOW, COMING TO THE ALLEGATION OF THE ASSESSING OFFI CER THAT THE MAJOR SOURCE OF INCOME ARE TV SUBSIDY, SALE OF ADVERTISEMENT SURPLU S FROM ODI BETWEEN INDIA AND PAKISTAN INCOME FROM RCA CRICKET ACADEMY AND INTERE ST INCOME. IT IS NOT IN DISPUTE THAT TV SUBSIDY, SALE ON ADVERTISEMENT SURPLUS FROM ODI BETWEEN INDIA AND PAKISTAN INCOME FROM RCA CRICKET ACADEMY ARE ALL RE LATING TO THE CONDUCT OF CRICKET MATCHES BY THE SOCIETY. IT IS UNDISPUTED FACT THAT WITHOUT CONDUCT OF MATCHES INCOME CANNOT BE DERIVED. THEREFORE, IT CAN BE SAF ELY INFERRED THAT THESE INCOMES ARE RELATED TO THE INCIDENTAL ACTIVITY OF THE ASSOC IATION. THESE INCOMES WOULD NOT ACCRUE WITHOUT THE GAME OF CRICKET. THE MAIN THRUS T OF REVENUES ARGUMENT IS THAT FOR ALLOWING EXEMPTION UNDER SECTION 11 OF THE ACT, THE ASSESSING OFFICER NEED TO EXAMINE WHETHER THE PROVISO TO SECTION 2(15) OF THE ACT IS ATTRACTED OR NOT. IT IS THE CONTENTION OF THE REVENUE THAT ASSESSEE WOULD FALL UNDER THE LIMB OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY TO WHICH CATEGORY ONLY THE PROVISO TO SECTION 2(15) APPLIES. IT IS CONTENDED THAT IF PROVISO 2(15) ATT RACTED, ASSESSEE LOSES BENEFIT OF EXEMPTION AS PER SECTION 13(8). THEREFORE, IT IS S UBMITTED THAT ONLY QUESTION TO BE DECIDED IS TO WHETHER ASSESSEE IS ENGAGED IN COMMER CIAL ACTIVITY FOR FEE OR OTHER CONSIDERATION. IT IS ALSO CONTENDED THAT NATURE OF RECEIPT ABOUT HANDS OF THE ASSESSEE BY WAY OF SHARING OF SPONSORSHIP OF MEDIA RIGHTS WITH BCCI AS WELL AS MATCH REVENUE FOR CONDUCTED VARIOUS CRICKET MATCHES . IT IS CONTENDED THAT IN THE ASSESSMENT YEAR 2008-09, THE ASSESSEE HAS EARNED SU RPLUS OF RS. 5.88 CRORES OUT OF RECEIPTS IN THE SHAPE OF ADVERTISEMENT, CANTEEN, AN D TICKETS OF RS.7.81 CRORES WHICH AMOUNTS TO SUPER NORMALLY PROFIT. THE OTHER HAND, CONTENTION OF THE ASSESSEE IS THAT THE ARGUMENT OF THE REVENUE IS MISPLACED AS TH E AUTHORITIES BELOW FAILED TO 33 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. APPRECIATE THE FACTS THAT EXPRESSION TRADE, COMMERC E OR BUSINESS IS TO BE UNDERSTOOD AS A REGULAR AND SYSTEMATIC ACTIVITY WIT H THE PRIME MOTIVE TO EARN PROFIT. WHEREAS THE ASSOCIATION NEVER ACTED AS A PROFESSION AL ADVERTISER, TV PRODUCER ETC. NO MATCHES OR ANY GAME OTHER THAN CRICKET OR NO OTH ER EVENTS ARE ORGANIZED TO ATTRACT AUDIENCE RATHER ONLY CRICKET MATCHES ARE BE ING ORGANIZED WHETHER THE SAME RESULT INTO PROFIT OR LOSS. IT IS CONTENTED THAT A LL CRICKET MATCHES DO NOT ATTRACT AUDIENCE BUT DUE TO HISTORICAL BACKGROUND IN THE CA SE OF MATCH BETWEEN INDIA AND PAKISTAN AUDIENCE FOR SUCH MATCH REMAINS ABNORMALLY HIGH. THEREFORE, UNDER THESE PECULIARITY OF FACT IT MAKING INFERENCE THAT THE AS SESSEE IS ENGAGED INTO COMMERCIAL ACTIVITIES IS NOT JUSTIFIED. 7. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO TH E RIVAL SUBMISSIONS OF THE PARTIES. IF VOLUME OF RECEIPTS AND CONSTANT INCREAS E INTO SURPLUS IS CONSIDERED, THIS NECESSITY GIVES IMPRESSION OF COMMERCIAL ACTIVITY. LET US APPRECIATE THE FACTS IN LIGHT OF VARIOUS JUDICIAL PRONOUNCEMENT. THE HONBLE SUPR EME COURT IN THE CASE OF COMMISSIONER OF SALE TAX VS SAI PUBLICATION FUND 25 8 ITR 70(SC) HAS HELD: THERE IS NO DISPUTE THAT THE PRIMARY AND DOMINANT ACTIVITY OF THE TRUST IS TO SPREAD THE MESSAGE OF SAIBABA. THIS MAIN ACTIVITY DOES NOT AM OUNT TO BUSINESS. THE ACTIVITY OF PUBLISHING AND SELLING LITERATURE, BOOKS AND OTHER LITERATURE IS O BVIOUSLY INCIDENTAL OR ANCILLARY TO THE MAIN ACTIVI TY OF SPREADING THE MESSAGE OF SAIBABA AND NOT TO ANY BUS INESS AS SUCH EVEN WITHOUT A PROFIT MOTIVE AND IT IS IN A WAY A MEANS TO ACHIEVE THE OBJECT OF THE TRUST THOUGH WHICH THE MESSAGE OF SAIBABA IS SPREAD. IT IS CLEAR FROM THE TRUST DEED AND OBJECT S CONTAINED THEREIN THAT IN WAS NOT ESTABLISHED WIT H AN INTENTION OF CARRYING ON THE BUSINESS/OCCUPATION OF SELLING OR SUPPLYING GOODS. THIS BEING THE POSITION, IT CANNOT BE SAID THAT THE TRUST CARRIES ON THE BUSINESS OF SELLING AND SUPPLYING GOODS SO A S TO FALL WITHIN THE MEANING OF DEALER UNDER SECTIO N 2(11) OF THE ACT. NO DOUBTS, THE DEFINITION OF BUSINESS GIVEN IN SE CTION 2(5A) OF THE ACT EVEN WITHOUT PROFIT MOTIVE I S WIDE ENOUGH TO INCLUDE ANY TRADE, COMMERCE OR MANUF ACTURE OR ANY ADVENTURE OR CONCERN IN THE NATURE OF TRADE, COMMERCE OR MANUFACTURE AND ANY TR ANSACTION IN CONNECTION WITH OR INCIDENTAL OR ANCILLARY TO THE COMMENCEMENT OR CLOSURE OF SUCH TR ADE, COMMERCE, MANUFACTURE, ADVENTURE OR CONCERN. IF THE MAIN ACTIVITY IS NOT BUSINESS, THE N ANY TRANSACTION INCIDENTAL OR ANCILLARY WOULD NOT 34 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. NORMALLY AMOUNT TO BUSINESS UNLESS AN INDEPENDENT INTENTION TO CARRY ON BUSINESS IN THE INCIDENTAL OR ANCILLARY ACTIVITY IS ESTABLISHED. I N SUCH CASES, THE ONUS OF PROOF OF AN INDEPENDENT INTENTION TO CARRY ON BUSINESS CONNECTED WITH OR INCIDENTAL OR ANCILLARY SALES WILL REST ON THE DEPARTMENT. THUS, IF THE MAIN ACTIVITY OF A PERSON IS NOT TRADE, COMMERCE, ETC., ORDINARILY INCIDENTA L OR ANCILLARY ACTIVITY MAY NOT COME WITHIN THE MEANI NG OF BUSINESS. TO PUT IF DIFFERENTLY, THE INCLUSION OF INCIDENTAL OR ANCILLARY ACTIVITY IN TH E DEFINITION OF BUSINESS PRE-SUPPOSES THE EXISTEN CE OF TRADE, COMMERCE, ETC. IN THE LIGHT OF THE ABOVE JUDGMENT IT CAN BE SAFEL Y INFERRED THAT IF THE ACTIVITY IS NOT INDEPENDENT OF MAIN ACTIVITY OF THE ASSESSEE IN THA T EVENT SUCH ANCILLARY ACTIVITY WOULD NOT FALL WITHIN THE TERM BUSINESS. THE OBJ ECTION OF THE ASSESSING OFFICER IS THAT, THAT THE OTHER ACTIVITIES HAVE PREDOMINATED T HE MAIN ACTIVITY. THIS REASONING OF THE ASSESSING OFFICER IS BASED UPON THE RECEIPTS OF THE ASSESSEE FROM THE OTHER ACTIVITY. BUT IT IS UNDISPUTED FACT THAT THESE ALL ACTIVITIES ARE DEPENDENT UPON CONDUCTING OF THE MATCH. THE ALLEGATION IS THAT TH E MATCHES ARE CONDUCTED TOTALLY ON COMMERCIAL LINES. FOR THIS REASONING THE ASSESS ING OFFICER IS AGAIN CONSIDERED THE QUANTUM OF AMOUNTS RECEIVED FROM BCCI AS TV SUBSIDI ES AND SUBSIDY FROM CRICKET TOURNAMENT FROM THE RECORDS. IT IS THE CONTENTION OF THE ASSESSEE THAT THE MAIN SOURCE OF RECEIPT WAS THE MATCH CONDUCTED BETWEEN I NDIA VS. PAKISTAN. THIS FACT IS NOT REFUTED BY THE REVENUE BY PLACING ANY CONTRARY MATERIAL. THE COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF DISTRICT CRICKET AS SOCIATION VS. DIT, WHEREIN THE CO- ORDINATE BENCH HAS DECIDED THE ISSUE IN PARA 10.9 O F THE ORDER AS UNDER: THUS RESPECTFULLY FOLLOWING THE DECISION OF HONBL E MADRAS HIGH COURT IN THE CASE OF TAMIL NADU CRICKET ASSOCIATION (SUPR A), WE HAVE TO HOLD THAT THE AMOUNTS RECEIVED BY THE ASSESSEE FROM A) G ROUND BOOKING CHARGE, B) HEALTH CLUB CHARGES, C) INCOME FROM CORP ORATE BOXES, D) LAWN BOOKING INCOME ,E) SPONSORSHIP MONEY AND SALE OF TICKET, ADVERTISEMENT, SOUVENIRS AND OTHER SUCH RECEIPTS DO NOT RESULT IN THE ASSESSEE BEING HELD A UNDERTAKING ACTIVITIES IN THE NATURE OF TRADE, COMMERCE AND BUSINESS. THESE RECEIPTS ARE INTRINS ICALLY RELATED, INTERCONNECTED AND INTERWOVEN WITH THE CHARITABLE A CTIVITY AND CANNOT 35 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. BE VIEWED SEPARATELY. THE ACTIVITIES RESULTING IN THE SAID RECEIPTS ARE ALSO CHARITABLE ACTIVITIES AND NOT TRADE, COMMERCE OR BUSINESS ACTIVITIES. FURTHER THE HONBLE JURISDICTIONAL HIGH COURT IN TH E CASE OF COMMISSIONER OF INCOME TAX VS. JODHPUR DEVELOPMENT AUTHORITY 287 CTR 0473 (RAJ) HAS HELD AS UNDER: 16. AS NOTICED HEREINABOVE, THE CONTENTION OF THE REVENUE IS THAT SINCE THE ASSESSEE ARE INVOLVED IN CARRYING ON ACTIVITIES IN THE NATURE OF TRADE AND COMMERCE, BY VIRUE OF FIRST PROVISO TO SECTION 2(15 ), THEIR ACTIVITY/OBJECT CANNOT BE RECOGNIZED AS FOR CHARITABLE PURPOSE SO A S TO MAKE THEM ENTITLED FOR REGISTRATION U/S 12A OF THE ACT OF 1961. 17. SECTION 2(15) OF THE ACT OF 1961 WHICH DEFINES CHARITABLE PURPOSES READS AS UNDER: (15) CHARITABLE PURPOSE INCLUDES RELIEF OF THE P OOR, EDUCATION, MEDICAL RELIEF, PRESERVATION OF ENVIRONMENT ( INCLUDING WATERSHEDS, FORESTS AND WILDLIFE) AND PRESERVATION OF MONUMENTS O PLACES OR OBJECTS OF AR TISTIC OR HISTORIC INTEREST, AND THE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC U TILITY; PROVIDED THAT THE ADVANCEMENT OF ANY OTHER OBJECT O F GENERAL PUBLIC UTILITY SHALL NOT BE A CHARITABLE PURPOSE, IF IT INVOLVES THE CARRYIN G ON O ANY ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS, OR ANY ACTIVITY OF REN DERING 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, O R RETENTION, OF THE INCOME FROM SUCH ACTIVITY; PROVIDED FURTHER THAT THE FIRST PROVISO SHALL NOT A PPLY I THE AGGREGATE VALUE OF THE RECEIPTS FROM THE ACTIVITIES REFERRED TO THEREIN IS TWENTY-FIVE LAKH RUPEES OR LESS IN THE PREVIOUS YEAR. 18. THE CHARITABLE PURPOSE AS DEFINED UNDER SECTI ON 2(15) AND PARTICULARLY, THE EXPRESSION ANY OTHER OBJECT OF GENERAL PUBLIC UTIL ITY USED THEREIN, HAVE BEEN INTERPRETED BY THE HONBLE BY THE SUPREME COURT AND VARIOUS HIGH COURTS IN CATENA OF DECISIONS, WHICH MAY BE BENEFICIALLY REFE RRED. 19. IN ANDHRA CHAMBER AS COMMERCES CASE (SUPRA), W HILE CONSIDERING THE EXPRESSION OBJECT OF GENERAL PUBLIC UTILITY AS US ED IN SECTION 4 (3) OF THE INCOME TAX ACT, 1922, THE HONBLE SUPREME COURT OBS ERVED: THE EXPRESSION OBJECT OF GENERAL PUBLIC UTILITY IN S.4(3) WOULD PRIMA FACIE INCLUDE ALL OBJECTS WHICH PROMOTE THE WELFARE OF THE GENERA L PUBLIC. IT CANNOT BE SAID THAT A PURPOSE WOULD CEASE TO BE CHARITABLE EVEN IF PUBLIC WELFARE IS INTENDED TO BE SERVED THEREBY IF IT INCLUDES THE TAKING OF STEPS TO URGE OR OPPOSE LEGISLATION AFFECTING TRADE, COMMERCE OR MANUFACTURE. IF THE PRIMARY PURPOSE BE ADVANCEMENT O OBJECTS OF GENERAL PUBLIC UTILITY, IF WOULD REMAIN CHARITABLE EVEN I AN INCIDENTAL ENTRY INTO THE 36 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. POLITICAL DOMAIN FOR ACHIEVING THAT PURPOSE E.G. PR OMOTION OF OR OPPOSITION TO LEGISLATION CONCERNING THAT PURPOSE, I CONTEMPLATED . (EMPHASIS ADDED) 20. IN SOLE TRUSTEE, LOK SHIKSHANA TRUST VS. CIT, ( 1975) 101 ITR, 254, THE HONBLE SUPREME COURT OBSERVED: IF THE PROFIT MUST NECESSARILY FEED A CHARITABLE P URPOSE UNDER THE TERMS OF THE TRUST, THE MERE FACTS THAT THE ACTIVITIES O THE TRUST YIEL D PROFIT WILL NOT ALTER THE CHARITABLE CHARACTER OF THE TRUST. THE RESTRICTIVE CONDITION THAT PURPOSE SHOULD NOT INVOLVE THE CARRYING ON OF ANY ACTIVITY FOR PROFIT WOULD BE SAT ISFIED IF PROFIT MAKING IS NOT THE OBJECT. 21. IN THE MATTER OF ADDITIONAL CIT VS. SURAT ART SILK CLOTH MANUFACTURES ASSOCIATION, (1980) 121 ITR, 1, THE HONBLE SUPREM E COURT HELD THAT IF THE PRIMARY OR DOMINANT PURPOSE OF A TRUST OR INSTITUTI ON IS CHARITABLE, ANOTHER OBJECT WHICH BY ITSELF MAY NOT BE CHARITABLE BUT WH ICH IS MERELY ANCILLARY OR INCIDENTAL TO THE PRIMARY OR DOMINANT PURPOSE WOULD NOT PREVENT THE TRUST OR INSTITUTION FROM BEING A VALID CHARITY. THE COURT FURTHER OBSERVED THAT TRUE MEANING OF THE WORDS IN SECTION 2(15) VIZ. NOT INV OLVING CARRYING ON ANY ACTIVITY OF PROFIT IS THAT WHEN THE PURPOSE OF A T RUST OR INSTITUTION IS ADVANCEMENT OF AN OBJECT OF GENERAL PUBLIC UTILITY, IT IS THAT OBJECT OF GENRAL PUBLIC UTILITY WHICH MUST NOT INVOLVE CARRYING ON O F ANY ACTIVITY FOR PROFIT AND NOT ITS ADVANCEMENT OR ATTAINMENT. THE COURT OBSER VED THAT WHAT IS INHIBITED BY THESE LAST TEN WORDS IS THE LINKING OF ACTIVITY OR PROFIT WITH THE OBJECT OF GENERAL PUBLIC UTILITY AND NOT ITS LINKING WITH THE ACCOMPLISHMENT OR CARRYING OUT OTHER OBJECT. THUS, SO LONG AS PURPOSE DOES NOT INVOLVE CARRYING ON OR ANY ACTIVITY FOR PROFIT, THE REQUIREMENT OF DEFINIT ION WOULD BE MET AND IT IS IMMATERIAL HOW THE MONEYS FOR ACHIEVING OR IMPLEME NTING SUCH PURPOSE ARE FOUND WHETHER BY CARRYING ON AN ACTIVITY FOR PROFIT OR NOT. 22. IN ANDHRA PRADESH ROAD TRANSPORT CORPORATIONS CASE (SUPRA), THE HONBLE SUPREME COURT WHILE RELYING UPON THE EARLIER DECISI ONS IN THE MATTER OF ADDITIONAL CIT VS. SURAT ART SILK CLOTH MANUFACTUR ES ASSOCIATION, (19800 121 ITR 1 AND CIT VS. BAR COUNCIL OF MAHARASHTRA, (19 81) 130 ITR 28 (SC), HELD THAT IF PREDOMINANT OBJECT IS TO CARRY OUT A CHARIT ABLE PURPOSE AND NOT EARN PROFIT, THE PURPOSE WOULD NOT LOSE ITS CHARITABLE C HARACTER MERELY BECAUSE SOME PROFIT ARISES FROM THE ACTIVITY. 23. IN GUJARAT MARITIME BOARDS CASE (SUPRA), THE HONBE SUPREME COURT AFTER DUE CONSIDERATION OF VARIOUS EARLIER DECISIONS, OBS ERVED: WE HAVE PERUSED A NUMBER OF DECISIONS OF THIS COUR T WHICH HAVE INTERPRETED THE WORDS, IN SECTION 2(150, NAMELY, ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY. FROM THE SAID DECISIONS IT EMERGES THAT THE SAID EXPRESS ION IS OF THE WIDE T CONNOTATION. THE WORD GENERAL IN THE SAID EXPRESSION MEANS PER TAINING TO A WHOLE CLASS. THEREFORE, ADVANCEMENT OF ANY OBJECT OF BENEFIT TO THE PUBLIC OR A SECTION OF THE PUBLIC OR A SECTION OF THE PUBLIC AS DISTINGUISHED FROM BENEFIT TO AN INDIVIDUAL OR A 37 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. GROUP OF INDIVIDUALS WOULD BE A CHARITABLE PURPOSE ( CIT V. AHMEDABAD RANA CASTE ASSOCIATION [(183) 140 ITR 1 (SC)]. THE SAID EXPR ESSION WOULD PRIMA FACIE INCLUDE ALL OBJECTS WHICH PROMOTE THE WELFARE OF THE GENERAL PU BLIC. IF CANNOT BE SAID THAT A PURPOSE WOULD CEASE TO BE CHARITABLE PURPOSE. WHEN AN OBJECT IS TO PROMOTE OR PROTECT THE INTEREST OF A PARTICULAR TRADE OR INDUS TRY THAT OBJECT BECOMES AN OBJECT OF PUBLIC UTILITY, BUT NOT SO, IF IT SEEKS TO PROMOTE THE INTEREST OF THOSE WHO CONDUCT THE SAID TRADE OR INDUSTRY ( CIT V. ANDHRA CHAMBER OF C OMMERCE[1965] 55 ITR 722 (SC)]. IF THE PRIMARY OR PREDOMINANT OBJECT OF ANY INSTI TUTION IS CHARITABLE, ANY OTHER OBJECT WHICH MIGHT NOT BE CHARITABLE BUT WHICH IS A NCILLARY OR INCIDENTAL TO THE DOMINANT PURPOSE, WOULD NOT PREVENT THE INSTITUTION FROM BEING A VALID CHARITY ( ADDL. CIT V. SURAT ART SILK CLOTH MANUFACTURERS ASS OCIATION [1980] 121 ITR 1 (SC). THE PRESENT CASE IN OUR VIEW IS SQUARELY COVERED BY THE JUDGMENT OF THIS COURT IN THE CASE OF CIT V. ANDHRA PRADESH STATE ROAD TRANSPORT CORPO RATION [1986] 159 ITR1 (SC) IN WHICH IT HAS BEEN HELD THAT SINCE THE CORPORATION W AS ESTABLISHED FOR PURPOSE OF PROVIDING EFFICIENT TRANSPORT SYSTEM, HAVING NO PRO FIT MOTIVE, THOUGH IT EARNS INCOME IN THE PROCESS, IF IS NOT LIABLE TO INCOME-TAX. APPLYING THE RATIO OF THE SAID JUDGMENT IN THE CASE OF ANDHRA PRADESH STATE ROAD TRANSPORT CORPORATION [1986] 159ITR 1, WE FIND THA T, IN THE PRESENT CASE, THE GUJARAT MARITIME BOARD IS ESTABLISH FOR THE PREDOMI NANT PURPOSE OF DEVELOPMENT OF MINOR PORTS WITHIN THE STATE OF GUJARAT, THE MANAGE MENT AND CONTROL OF THE BOARD IS ESSENTIALLY WITH THE STATE GOVERNMENT AND THERE IS NO PROFIT MOTIVE, A INDICATED BY THE PROVISIONS OF SECTIONS 73, 74 AND 75 OF THE 198 1 ACT. THE INCOME EARNED BY THE BOARD IS DEPLOYED FOR THE DEVELOPMENT OF MINOR PORT S IN THE STATE OF GUJARAT. IN THE CIRCUMSTANCE , IN OUR VIEW THE JUDGMENT OF THIS COU RT IN ANDHRA PRADESH STATE ROAD TRANSPORT CORPORATION [1986] 159 ITR 1 SQUARELY APP LIES TO THE FACTS OF THE PRESENT CASE. (EMPHASIS ADDED) 24. IN COMMISSIONER OF INCOME TAX V. KRISHI UPAJ M ANDI SAMITI, JAISALMER, (2011) 331 ITR 135 (RAJ.), A BENCH OF THIS COURT WH ILE CONSIDERING THE ENTITLEMENT OF KRISHI UPAJ MANDI SAMITI, A STATUTOR Y BODY, CONSTITUTED AND ESTABLISHED UNDER THE RAJASTHAN AGRICULTURAL PRODUC E MARKET ACT, 1961, OBSERVED THAT MAY BE THE INCOME RECEIVED BY THE SAM ITI BY WAY OF CESS OR MANDI FEES IS NOT SHOWN TO BE SPENT WHOLLY FOR THE PURPOSE OF RELIEF OF THE POOR, EDUCATION, OR MEDICAL RELIEF, BUT UNDER THE S CHEME OF THE ACT, BEING THE RAJASTHAN AGRICULTURAL PRODUCE MARKETS ACT, 1961, T HE ENTIRE AMOUNT RECEIVED BY THE SAMITI IS REQUIRED TO BE SPENT FOR THE PURPO SES MENTIONED THEREIN, WHICH OBVIOUSLY INCLUDE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY. 25. IN LUKHNOW DEVELOPMENT AUTHORITYS CASE (SUPRA) , WHILE EXAMINING THE QUESTION REGARDING APPLICABILITY O PROVISO TO SECTI ON 2(15), ALLAHABAD HIGH COURT OBSERVED: 29. FOR THE APPLICABILITY OF PROVISO TO SECTION 2( 15), THE ACTIVITIES OF THE TRUST SHOULD BE CARRIED OUT ON COMMERCIAL LINES WITH INTENTION T O MAKE PROFIT. WHERE THE TRUST IS CARRYING OUT ITS ACTIVATES ON NON-COMMERCIAL LINES WITH NO MOTIVE TO EARN PROFITS, OR FULFILLMENT OF ITS AIMS AN OBJECTIVES, WHICH ARE CH ARITABLE IN NATURE AND IN THE PROCESS EARN SOME PROFIT, THE SAME WOULD NOT BE HIT BY PROV ISO TO SECTION 2(15). THE AIMS AND OBJECTS OF THE MERE SELLING SOME PRODUCT AT A P ROFIT WILL NOT IPSO FACTO HIT 38 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. ASSESSEE BY APPLYING PROVISO TO SECTION 2(15) AND D ENY EXEMPTION AVAILABLE UNDER SECTION 11. THE INTENTION OF THE TRUSTEES AND THE MANNER IN WHICH THE ACTIVITIES OF THE CHARITABLE TRUST INSTITUTION ARE UNDERTAKING AR E HIGHLY RELEVANT TO DECIDED THE ISSUE OF APPLICABILITY OF PROVISO TO SECTION 2 (15) . 26. COMING TO THE DECISION OF JAMMU & KASHMIR HIGH COURT IN JAMMU DEVELOPMENT AUTHORITYS CASE (SUPRA), RELIED UPON BY LEARNED COUNSEL FOR THE REVENUE, REVEAL THAT THE APPEAL PREFERRED BY THE JA MMU DEVELOPMENT AUTHORITY WAS DISMISSED BY THE COURT OBSERVING THAT THERE ARE FINDINGS OF FACTS THAT THE ASSESSEE-APPELLANT HAS NOT BEEN ACTING TO ADVANCE ANY OF THE OBJECT CONCERNING GENERAL PUBLIC UTILITY. FURTHER WHILE R EFERRING TO FIRST PROVISO TO SECTION 2(15), THE COURT HAS OBSERVED THAT WE FIND THAT NO SUBSTANTIAL QUESTION OF LAW MUCH LESS A SUBSTANTIAL QUESTION OF LAW WOULD EMERGE FROM THE IMPUGNED ORDER OF INCOME TAX APPELLATE TRIBUNAL WARRANTING ADMISSION OF THE APPEAL.A BARE PERUSAL OF THE ORDER REVEAL T HAT THE CATENA OF DECISIONS OF THE HONBLE SUPREME COURT REFERRED TO HEREINABOV E, INTERPRETING THE EFFECT OF FIRST PROVISO IN CONTEXT OF THE MAIN PROVISION O F SECTION 2(15), WHICH DEFINES CHARITABLE PURPOSE, WERE NOT BROUGHT TO THE NOTICE OF THE COURT AND THEREFORE, THE SAID ORDER PASSED BY THE COURT BY ME RELY RECORDING ITS IPSE DIXIT DOES NOT HELP THE REVENUE IN ANY MANNER. 27. FROM VARIOUS DECISIONS OF THE HONBLE SUPREME COURT DISCUSSED HEREINABOVE, THE SETTLED POSITION OF LAW EMERGES IS THAT IF THE PRIMARY OR PREDOMINANT OBJET OF AN INSTITUTION IS CHARITABLE, ANY OTHER WHICH MI GHT NOT BE CHARITABLE BUT WHICH IS ANCILLARY OR INCIDENTAL TO THE DOMINANT PU RPOSE, MAY BE INVOLVING ELEMENT OF PROFIT, WOULD BE PREVENT THE INSTITUTION FROM BEING A VALID CHARITABLE TRUST. IN THE LIGHT OF THE ABOVE BINDING PRECEDENTS, WE AR E UNABLE TO AFFIRM THE VIEW OF THE REVENUE. IN THE PRESENT CASE, MATERIAL AS PLACED BE FORE US SUGGESTS THAT THE ASSESSING OFFICER IS SWAYED BY THE FIGURES AND VOLU ME OF RECEIPTS. ADMITTEDLY, SUCH RECEIPTS ARE INTERMITTENT AND NOT REGULAR AND ALSO IS DEPENDENT ON THE CONDUCT OF CRICKET MATCH. IT IS NOT OTHER WAY ROUND THAT THE CRICKET MATCHES ARE DEPENDENT UPON SUCH ACTIVITIES. THE UNDISPUTED FACTS ARE THA T THE ASSESSEE IS REGISTERED UNDER THE RAJASTHAN SPORTS (REGISTRATION, RECOGNITION AND REGULATION) ACT 2005 AND FORMED WITH THE OBJECTIVE OF PROMOTING THE SPORTS OF CRICK ET WITHIN THE STATE OF RAJASTHAN SO MAIN OBJECTIVE OR ACTIVITY OF THE ASSESSEE IS PROMO TION OF THE CRICKET. THE 39 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. ASSOCIATION IS ORGANIZING TOURNAMENT LIKE RANJI TRO PHY, IRANI TROPHY, DILIP TROPHY, MAHARAN BHAGWAT SINGH TROPHY, SALIM DURRANI TROPHY ETC. THE ASSESSING OFFICER HAS NOT DOUBTED ABOUT THESE ACTIVITIES OF THE ASSOCIATI ON. IT IS ALSO BROUGHT TO OUR NOTICE THAT IN THE INTERNATIONAL ONE DAY MATCH BETWEEN SOU TH AFRICA AND INDIA, THE ASSOCIATION SUFFERED DEFICITS OF RS. 1.6 CRORES. I T IS ALSO BROUGHT TO OUR NOTICE THAT THE RCA HAS ALSO INCURRED IN VARIOUS OTHER EXPENSES WITH A VIEW TO PROMOTE THE GAME OF CRICKET VIZ. ON COACHING CAMPS OF RS. 20,40 ,360/-, STATE CRICKET ACTIVITIES OF RS. 1,08,60,566/-, GROUND EXPENSE OF RS. 33,97,435 /- AND INTERNATIONAL TOURNAMENT EXPENSES OF RS. 2,09,16,911/-. THESE FACTS GO TO D EMONSTRATE THAT THE ASSESSEE HAS BEEN PREDOMINANTLY ENGAGED INTO THE ACTIVITY OF PRO MOTING CRICKET MATCH. THE COUNSEL FOR THE ASSESSEE HAS PLACED RELIANCE ON THE JUDGMENT OF THE HONBLE DELHI HIGH COURT RENDERED IN THE CASE OF INSTITUTE OF CHA RTERED ACCOUNTANT VS DIRECTOR GENERAL OF INCOME TAX, WHEREIN THE HONBLE HIGH COU RT HELD THAT EVEN THOUGH FEE ARE CHARGED BY THE PETITIONER INSTITUTE FOR PROVIDI NG COACHING CLASSES AND HOLDING INTERVIEWS WITH RESPECT OF CAMPUS PLACEMENT, THE SA ID ACTIVITY CANNOT BE STATED TO BE RENDERING OF SERVICE IN RELATION TO ANY TRADE, C OMMERCE OR BUSINESS AS SUCH ACTIVITIES ARE UNDERTAKEN BY THE PETITIONER INSTITU TE IN FURTHERANCE OF ITS MAIN OBJECT WHICH HAS HELD EARLIER ARE NOT TRADE, COMMERCE OR B USINESS. IN THE PRESENT CASE ALSO THE MAIN ACTIVITY OF THE ASSESSEE IS CONDUCTIN G OF THE CRICKET MATCH WHICH FALLS UNDER THE CATEGORY OF GENERAL PUBLIC UTILITY. THIS FACT IS NOT DISPUTED BY THE REVENUE. ALL THESE ACTIVITIES AN ANCILLARY TO THE MAIN ACTIV ITY. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED IN DECLINING THE EXEMPTION. 40 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. LD. CIT (DR) VEHEMENTLY URGE THAT FIRST PROVISO TO CLAUSE (15), SECTION 2 OF THE ACT, THEREFORE, AS PER SECTION 13(8) OF THE ACT NOTHING CONTAINED IN SECTION 11 OR SECTION 12 SHALL OPERATE, SO AS TO EXCLUDE OF INCOME OF TOT AL INCOME OF PREVIOUS YEAR OF THE PRESENT. AS WE HAVE HELD THAT IN THE LIGHT OF THE VARIOUS JUDICIAL PRONOUNCEMENT PROVISO TO CLAUSE (15) TO SECTION 2 OF THE ACT WOUL D NOT BE APPLICABLE ON THE FACTS OF THE PRESENT CASE. LD. DR HAS RELIED ON THE DECISI ON OF THE CO-ORDINATE BENCH IN THE CASE OF ENTERTAINMENT SOCIETY OF GOA VS. CIT (2013) 34 TAXMANN.COM 201(PANJI). THIS DECISION DOES NOT HELP THE REVENUE IN VIEW OF JUDGMENTS OF HONBLE MADRAS HIGH COURT AND DELHI HIGH COURT CITED (SUPRA). THER EFORE, THIS ARGUMENT OF THE LD. CIT (DR) IS ALSO DEVOID OF ANY MERIT. IN VIEW, OF THE ABOVE DISCUSSION GROUND NOS. 2 TO 8 OF THE OF THE ASSESSEES APPEAL ARE ALLOWED. 8. GROUND NO. 9 IS AGAINST CHARGING OF INTEREST, WH ICH IS CONSEQUENTIAL IN NATURE HELD ACCORDINGLY. THIS GROUND OF THE ASSESSEE IS DI SMISSED. 9. GROUND NO. 10 IN GENERAL IN NATURE AND NEEDS NO SEPARATE ADJUDICATION. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED IN ITA NO. 388/JP/2012, IS PARTLY ALLOWED. 11. NOW, COMING TO THE CROSS APPEAL IN ASSESSMENT Y EAR 2009-10, IN ITA NO. 944/JP/2013 AND ITA NO. 921/JP/2013. FIRST WE TAKE UP THE REVENUE APPEAL IN ITA NO. 921/JP/2013 PERTAINING TO THE ASSESSMENT YEAR 2009-10. THE REVENUE HAS RAISED FO LLOWING GROUNDS OF APPEAL. 41 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE AND IN LAW THE LD. CIT(A) WAS JUSTIFIED IN ALLOWING DEPRECIATI ON OF RS. 2,16,62,215/- IN ABSENCE OF DETAILS OF ASSETS ACQUI RED AND USED BY ASSESSEE. 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CAE AND IN LAW THE LD. CIT(A) WAS JUSTIFIED IN ALLOWING THE TDS OF RS. 3,10,312/- AND INTEREST THEREON OF RS. 8,412/- CLAIMED BY THE ASSE SSEE UNDER THE HEAD ADMINISTRATIVE EXPENSES IN INCOME & EXPENDITURE A/ C. 12. BRIEFLY, STATED THE FACTS ARE THAT THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY ASSESSEMENT AND ASSESSMENT U/S 144 OF THE ACT, WAS FRAMED BY THE ORDER DATED 13/12/2011. THEREBY, THE ASSESSING OFFICER R EJECTED THE CLAIM OF DEDUCTION U/S 11 & 12 OF THE ACT AND ALSO DISALLOWS THE DEPRE CIATION LUMP-SUM DISALLOWANCE OF OUT OF EXPENDITURE AND DISALLOWANCE OF INCOME TAX A ND INTEREST ON TDS. AGGRIEVED BY THIS, THE ASSESSEE PREFERRED AN APPEAL BEFORE LD . CIT(A). THE LD. CIT(A) HAS CONFIRMED THE DISALLOWANCE OF EXEMPTION U/S 11 AND 12, HOWEVER DELETED THE ADDITION MADE ON ACCOUNT OF DISALLOWANCE OF DEPRECI ATION AND ALSO DELETED THE DISALLOWANCE MADE ON ACCOUNT OF NON-PAYMENT OF TDS AND LUMP-SUM DISALLOWANCE THE ASSESEE AND REVENUE BOTH HAVE CHALLENGED THIS D ECISION, BY FILING SEPARATE APPEALS. 12.1 FIRST GROUND OF REVENUES APPEAL IS AGAINST DE LETION OF DEPRECIATION AT THE TIME OF HEARING THE LD. DEPARTMENTAL REPRESENTATIVE S FAIRLY CONCEDED THAT THIS ISSUE IS COVERED AGAINST THE REVENUE BY THE JUDGMENT OF H ONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. KRISH I UPAZ MANDI SAMITI 388 ITR 605(RAJ) AND ALSO THAT THIS ISSUE IS DECIDED AGAINS T THE REVENUE BY THE JUDGMENT OF HONBLE SUPREME COURT IN THE JUDGMENT OF R.K. SYNTH ETIC VS. UNION OF INDIA. 42 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE IN TO THE ORDER OF THE LD. CIT(A) SAME IS HEREBY CONFIRMED. GROUND NO. 1 OF THE REVEN UES APPEAL IS DISMISSED. 12.2 GROUND NO. 2 IN THE REVENUES APPEAL IN THE DE LETION OF ADDITION MADE ON ACCOUNT OF NON-DEDUCTION OF DEDUCTION OF TAX AT SOU RCE. THE LD. DEPARTMENTAL REPRESENTATIVES SUPPORTED THE ORDERS OF THE ASSESSI NG OFFICER. 12.3 ON THE CONTRARY, THE LD. COUNSEL FOR THE ASSES SEE SUPPORTED THE ORDERS OF THE LD. CIT(A). 12.4 WE HAVE HEARD THE RIVAL CONTENTIONS, WE FIND T HAT LD. CIT(A) HAS GIVEN A FINDING ON FACTS BY OBSERVING AS UNDER: I HAVE CONSIDERED FACTS OF THE CASE. IT IS NOTICED THAT THE AO HAS DISALLOWED THIS AMOUNT WITHOUT BRINGING OUT ANY FAC T ON RECORD AND WITHOUT GIVING AN OPPORTUNITY OF BEING HEARD TO THE APPELLANT. THE APPELLANTS SUBMISSION IS THAT THE TDS HAS BEEN DEP OSITED BEFORE DUE DATE OF FILING THE RETURN. SINCE THE AMOUNT HAS BE EN DEPOSITED BY DUE DATE, THE DISALLOWANCE APPEARS TO BE UNCALLED FOR A ND IS, ACCORDINGLY, DELETED. THIS FINDING OF FACT IS NOT CONTROVERTED BY THE REV ENUE. THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE INTO THE ORDER OF THE LD. C IT(A). 13. THE GROUNDS RAISED IN THE REVENUES APPEAL IN I TA NO.921/JP/2013, ARE DISMISSED. 14. NOW, WE TAKE UP, THE ASSESSEES APPEAL IN ITA N O. 944/JP/2013 PERTAINING TO ASSESSMENT YEAR 2009-10. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL. 1. THE VERY ACTION TAKEN U/S 147 R/W 148 OF THE ACT I S BAD IN LAW, WITHOUT JURISDICTION AND BEING VOID AB-INITIO, HENCE THE IM PUGNED NOTICE ISSUED U/S 148 OF THE ACT KINDLY BE QUASHED. CONSEQUENTLY THE IMPUGNED ASSESSMENT FRAMED U/S 144/148 OF THE ACT DATED 13.1 2.2010 ALSO KINDLY BE QUASHED. 43 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. 2. THE LD. AO ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN FRAMING THE ASSESSMENT U/S 144 WITHOUT AFFORDING ADEQUATE AND R EASONABLE OPPORTUNITY AND EVEN WITHOUT COMPLYING WITH THE MAN DATORY STATUTORY REQUIREMENT OF LAW. THE IMPUGNED ORDER HAVING BEEN FRAMED IN GROSS BREACH OF NATURAL JUSTICE, KINDLY BE QUASHED. 3. THE IMPUGNED ADDITIONS AND DISALLOWANCES MADE IN TH E ORDER U/S 144 DATED 13.12.2011 ARE BAD IN LAW AND ON FACTS OF THE CASE, FOR WANT OF JURISDICTION AND VARIOUS OTHER REASONS AND HENCE, T HE SAME KINDLY BE DELETED. 4.1 THE LD. CIT(A) ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN CONFIRMING THE DENIAL OF EXEMPTION U/S 11 & 12 OF T HE ACT BY THE AO WHILE ASSESSING THE INCOME OF THE APPELLANT. SUCH DENIAL AND CONFIRMATION BEING TOTALLY CONTRARY TO THE PROVISIO NS OF LAW AND FACTS, THE APPELLANT BE ALLOWED THE BENEFITS OF EXEMPTION. 4.2 THE LD. CIT(A) ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN CONFIRMING THE DENIAL OF EXEMPTION U/S 11 OF THE AC T ON MERITS ALSO BY CONFIRMING THE ADVERSE FINDINGS OF THE AO THAT T HE ACTIVITIES OF THE APPELLANT ARE NOT CHARITABLE IN NATURE BUT TINTED W ITH COMMERCIALITY. SUCH FINDINGS RUNNING CONTRARY TO THE FACTS AND CIR CUMSTANCES OF THE PRESENT CASE, BE QUASHED IN TOTALITY. 4.3 THE LD. CIT(A) ERRED IN LAW AS WELL AS ON THE F ACTS OF THE CASE IN CONFIRMING THE ACTION OF THE AO WHILE INVOKING PROV ISO TO SEC. 2(15) OF THE ACT WHICH BEING CONTRARY TO THE PROVISIONS OF T HE LAW AND FACTS, IT HAS TO BE HELD THAT THE SAID PROVISO TO SEC. 2(15) OF THE ACT IS NOT APPLICABLE TO THE FACTS AND CIRCUMSTANCES OF THE PR ESENT CASE HENCE, IT MAY KINDLY BE HELD SO. 4.4 RS. 1,50,00,000/-: THE LD. CIT(A) ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN CONFIRMING THE ADDITION OF THE DONAT ION TO CORPUS FUND OF RS.1,50,00,000/-. THE ADDITION SO MADE, BEING COMP LETELY CONTRARY TO THE PROVISIONS OF LAW AND FACTS ON RECORD AND HENCE , THE SAME BE DELETED IN FULL. 4.5 THE LD. CIT(A) ALSO ERRED IN LAW AS WELL AS ON THE FACTS OF THE CASE IN CONFIRMING THE ACTION OF THE AO IN CHARGING THE TAX AT THE MAXIMUM MARGINAL RATE (MMR) WHICH ACTION IS ALSO BEING COMP LETELY CONTRARY TO THE PROVISIONS OF LAW AND FACTS ON RECORD AND HENCE , KINDLY BE QUASHED. 5. RS. 50,00,000/-: THE LD. CIT(A) ERRED IN LAW A S WELL AS ON THE FACTS OF THE CASE IN CONFIRMING THE DISALLOWANCE OF RS. 50,0 0,000/- RELYING ON THE ALLEGATION OF THE NON-PRODUCTION/ABSENCE OF THE BOOKS OF ACCOUNT. 44 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. THE DISALLOWANCE SO MADE, BEING COMPLETELY CONTRARY TO THE PROVISIONS OF LAW AND FACTS ON RECORD AND HENCE, THE SAME BE D ELETED IN FULL. 5. THE LD. CIT(A) FURTHER ERRED IN LAW AS WELL AS O N THE FACTS OF THE CASE IN CONFIRMING THE CHARGING INTEREST OF RS. 12,29,368/- U/S 234A & 2,02,84,572/- U/S 234B OF THE ACT. THE APPELLANT T OTALLY DENIES ITS LIABILITY OF CHARGING OF ANY SUCH INTEREST. THE IN TEREST SO CHARGED, BEING CONTRARY TO THE PROVISIONS OF LAW AND FACTS, KINDLY BE DELETED IN FULL. 6. THE APPELLANT PRAYS YOUR HONOUR INDULGENCES TO ADD, AMEND OR ALTER OF OR ANY OF THE GROUNDS OF THE APPEAL ON OR BEFORE THE DATE OF HEARING. 15. GROUND NO. 1 AT THE TIME TO HEARING, THE LD . COUNSEL FOR THE ASSESSEE SUBMITTED THAT HE DOES NOT WISH TO CHALLENGE PRESS. THE GROUND NO. 1, THEREFORE SAME IS DISMISSED AS NOT PRESSED. 15.1 GROUND NOS. 2 TO 3 ARE AGAINST NON-AFFORDING OPPORTUNITY TO THE ASSESSEE. WE FIND THAT LD. CIT(A) HAS GIVEN SUFFICIENT OPPORT UNITY AT THE APPELLATE STAGE TO THE ASSESSEE. THEREFORE, GROUND NO. 2 AND 3 ARE DISMIS SED. 15.2 GROUND NO. 4.1 TO 4.3 ARE AGAINST THE REJECTIN G THE CLAIM OF EXEMPTION U/S 11 OF THE ACT. APROPOS TO GROUND NO. 4.1 TO 4.3 , THE RESPECTIVE REPRESENTATIVES OF THE PARTIES HAVE ADOPTED THE SAME ARGUMENT AS WERE IN T HE ITA NO. 388/JP/2016, PERTAINING TO THE ASSESSMENT YEAR 2008-09. THE GRO UND RAISED IN THAT APPEAL HAS BEEN DECIDED BY US, BY OBSERVING AS UNDER: WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO THE RIVAL SUBMISSIONS OF THE PARTIES. IF VOLUME OF RECEIPTS AND CONSTANT INCREAS E INTO SURPLUS IS CONSIDERED, THIS NECESSITY GIVES IMPRESSION OF COMMERCIAL ACTIVITY. LET US APPRECIATE THE FACTS IN LIGHT OF VARIOUS JUDICIAL PRONOUNCEMENT. THE HONBLE SUPR EME COURT IN THE CASE OF COMMISSIONER OF SALE TAX VS SAI PUBLICATION FUND 25 8 ITR 70(SC) HAS HELD: THERE IS NO DISPUTE THAT THE PRIMARY AND DOMINANT ACTIVITY OF THE TRUST IS TO SPREAD THE MESSAGE OF SAIBABA. THIS MAIN ACTIVITY DOES NOT AM OUNT TO BUSINESS. THE ACTIVITY OF PUBLISHING AND SELLING LITERATURE, BOOKS AND OTHER LITERATURE IS O BVIOUSLY INCIDENTAL OR ANCILLARY TO THE MAIN ACTIVI TY OF SPREADING THE MESSAGE OF SAIBABA AND NOT TO ANY BUS INESS AS SUCH EVEN WITHOUT A PROFIT MOTIVE AND IT IS IN A WAY A MEANS TO ACHIEVE THE OBJECT OF THE TRUST THOUGH WHICH THE MESSAGE OF SAIBABA IS 45 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. SPREAD. IT IS CLEAR FROM THE TRUST DEED AND OBJECT S CONTAINED THEREIN THAT IN WAS NOT ESTABLISHED WIT H AN INTENTION OF CARRYING ON THE BUSINESS/OCCUPATION OF SELLING OR SUPPLYING GOODS. THIS BEING THE POSITION, IT CANNOT BE SAID THAT THE TRUST CARRIES ON THE BUSINESS OF SELLING AND SUPPLYING GOODS SO A S TO FALL WITHIN THE MEANING OF DEALER UNDER SECTIO N 2(11) OF THE ACT. NO DOUBTS, THE DEFINITION OF BUSINESS GIVEN IN SE CTION 2(5A) OF THE ACT EVEN WITHOUT PROFIT MOTIVE I S WIDE ENOUGH TO INCLUDE ANY TRADE, COMMERCE OR MANUF ACTURE OR ANY ADVENTURE OR CONCERN IN THE NATURE OF TRADE, COMMERCE OR MANUFACTURE AND ANY TR ANSACTION IN CONNECTION WITH OR INCIDENTAL OR ANCILLARY TO THE COMMENCEMENT OR CLOSURE OF SUCH TR ADE, COMMERCE, MANUFACTURE, ADVENTURE OR CONCERN. IF THE MAIN ACTIVITY IS NOT BUSINESS, THE N ANY TRANSACTION INCIDENTAL OR ANCILLARY WOULD NOT NORMALLY AMOUNT TO BUSINESS UNLESS AN INDEPENDENT INTENTION TO CARRY ON BUSINESS IN THE INCIDENTAL OR ANCILLARY ACTIVITY IS ESTABLISHED. I N SUCH CASES, THE ONUS OF PROOF OF AN INDEPENDENT INTENTION TO CARRY ON BUSINESS CONNECTED WITH OR INCIDENTAL OR ANCILLARY SALES WILL REST ON THE DEPARTMENT. THUS, IF THE MAIN ACTIVITY OF A PERSON IS NOT TRADE, COMMERCE, ETC., ORDINARILY INCIDENTA L OR ANCILLARY ACTIVITY MAY NOT COME WITHIN THE MEANI NG OF BUSINESS. TO PUT IF DIFFERENTLY, THE INCLUSION OF INCIDENTAL OR ANCILLARY ACTIVITY IN TH E DEFINITION OF BUSINESS PRE-SUPPOSES THE EXISTEN CE OF TRADE, COMMERCE, ETC. IN THE LIGHT OF THE ABOVE JUDGMENT IT CAN BE SAFEL Y INFERRED THAT IF THE ACTIVITY IS NOT INDEPENDENT OF MAIN ACTIVITY OF THE ASSESSEE IN THA T EVENT SUCH ANCILLARY ACTIVITY WOULD NOT FALL WITHIN THE TERM BUSINESS. THE OBJ ECTION OF THE ASSESSING OFFICER IS THAT, THAT THE OTHER ACTIVITIES HAVE PREDOMINATED T HE MAIN ACTIVITY. THIS REASONING OF THE ASSESSING OFFICER IS BASED UPON THE RECEIPTS OF THE ASSESSEE FROM THE OTHER ACTIVITY. BUT IT IS UNDISPUTED FACT THAT THESE ALL ACTIVITIES ARE DEPENDENT UPON CONDUCTING OF THE MATCH. THE ALLEGATION IS THAT TH E MATCHES ARE CONDUCTED TOTALLY ON COMMERCIAL LINES. FOR THIS REASONING THE ASSESS ING OFFICER IS AGAIN CONSIDERED THE QUANTUM OF AMOUNTS RECEIVED FROM BCCI AS TV SUBSIDI ES AND SUBSIDY FROM CRICKET TOURNAMENT FROM THE RECORDS. IT IS THE CONTENTION OF THE ASSESSEE THAT THE MAIN SOURCE OF RECEIPT WAS THE MATCH CONDUCTED BETWEEN I NDIA VS. PAKISTAN. THIS FACT IS NOT REFUTED BY THE REVENUE BY PLACING ANY CONTRARY MATERIAL. THE COORDINATE BENCH OF THIS TRIBUNAL IN THE CASE OF DISTRICT CRICKET AS SOCIATION VS. DIT, WHEREIN THE CO- ORDINATE BENCH HAS DECIDED THE ISSUE IN PARA 10.9 O F THE ORDER AS UNDER: THUS RESPECTFULLY FOLLOWING THE DECISION OF HONBL E MADRAS HIGH COURT IN THE CASE OF TAMIL NADU CRICKET ASSOCIATION (SUPR A), WE HAVE TO HOLD THAT THE AMOUNTS RECEIVED BY THE ASSESSEE FROM A) G ROUND BOOKING CHARGE, B) HEALTH CLUB CHARGES, C) INCOME FROM CORP ORATE BOXES, D) LAWN BOOKING INCOME ,E) SPONSORSHIP MONEY AND SALE OF TICKET, ADVERTISEMENT, SOUVENIRS AND OTHER SUCH RECEIPTS DO NOT RESULT IN THE ASSESSEE BEING HELD A UNDERTAKING ACTIVITIES IN THE NATURE OF TRADE, COMMERCE AND BUSINESS. THESE RECEIPTS ARE INTRINS ICALLY RELATED, INTERCONNECTED AND INTERWOVEN WITH THE CHARITABLE A CTIVITY AND CANNOT BE VIEWED SEPARATELY. THE ACTIVITIES RESULTING IN THE SAID RECEIPTS ARE ALSO CHARITABLE ACTIVITIES AND NOT TRADE, COMMERCE OR BUSINESS ACTIVITIES. 46 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. FURTHER THE HONBLE JURISDICTIONAL HIGH COURT IN TH E CASE OF COMMISSIONER OF INCOME TAX VS. JODHPUR DEVELOPMENT AUTHORITY 287 CTR 0473 (RAJ) HAS HELD AS UNDER: 16. AS NOTICED HEREINABOVE, THE CONTENTION OF THE REVENUE IS THAT SINCE THE ASSESSEE ARE INVOLVED IN CARRYING ON ACTIVITIES IN THE NATURE OF TRADE AND COMMERCE, BY VIRUE OF FIRST PROVISO TO SECTION 2(15 ), THEIR ACTIVITY/OBJECT CANNOT BE RECOGNIZED AS FOR CHARITABLE PURPOSE SO A S TO MAKE THEM ENTITLED FOR REGISTRATION U/S 12A OF THE ACT OF 1961. 17. SECTION 2(15) OF THE ACT OF 1961 WHICH DEFINES CHARITABLE PURPOSES READS AS UNDER: (15) CHARITABLE PURPOSE INCLUDES RELIEF OF THE P OOR, EDUCATION, MEDICAL RELIEF, PRESERVATION OF ENVIRONMENT ( INCLUDING WATERSHEDS, FORESTS AND WILDLIFE) AND PRESERVATION OF MONUMENTS O PLACES OR OBJECTS OF AR TISTIC OR HISTORIC INTEREST, AND THE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC U TILITY; PROVIDED THAT THE ADVANCEMENT OF ANY OTHER OBJECT O F GENERAL PUBLIC UTILITY SHALL NOT BE A CHARITABLE PURPOSE, IF IT INVOLVES THE CARRYIN G ON O ANY ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS, OR ANY ACTIVITY OF REN DERING 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, O R RETENTION, OF THE INCOME FROM SUCH ACTIVITY; PROVIDED FURTHER THAT THE FIRST PROVISO SHALL NOT A PPLY I THE AGGREGATE VALUE OF THE RECEIPTS FROM THE ACTIVITIES REFERRED TO THEREIN IS TWENTY-FIVE LAKH RUPEES OR LESS IN THE PREVIOUS YEAR. 18. THE CHARITABLE PURPOSE AS DEFINED UNDER SECTI ON 2(15) AND PARTICULARLY, THE EXPRESSION ANY OTHER OBJECT OF GENERAL PUBLIC UTIL ITY USED THEREIN, HAVE BEEN INTERPRETED BY THE HONBLE BY THE SUPREME COURT AND VARIOUS HIGH COURTS IN CATENA OF DECISIONS, WHICH MAY BE BENEFICIALLY REFE RRED. 19. IN ANDHRA CHAMBER AS COMMERCES CASE (SUPRA), W HILE CONSIDERING THE EXPRESSION OBJECT OF GENERAL PUBLIC UTILITY AS US ED IN SECTION 4 (3) OF THE INCOME TAX ACT, 1922, THE HONBLE SUPREME COURT OBS ERVED: THE EXPRESSION OBJECT OF GENERAL PUBLIC UTILITY IN S.4(3) WOULD PRIMA FACIE INCLUDE ALL OBJECTS WHICH PROMOTE THE WELFARE OF THE GENERA L PUBLIC. IT CANNOT BE SAID THAT A PURPOSE WOULD CEASE TO BE CHARITABLE EVEN IF PUBLIC WELFARE IS INTENDED TO BE SERVED THEREBY IF IT INCLUDES THE TAKING OF STEPS TO URGE OR OPPOSE LEGISLATION AFFECTING TRADE, COMMERCE OR MANUFACTURE. IF THE PRIMARY PURPOSE BE ADVANCEMENT O OBJECTS OF GENERAL PUBLIC UTILITY, IF WOULD REMAIN CHARITABLE EVEN I AN INCIDENTAL ENTRY INTO THE POLITICAL DOMAIN FOR ACHIEVING THAT PURPOSE E.G. PR OMOTION OF OR OPPOSITION TO LEGISLATION CONCERNING THAT PURPOSE, I CONTEMPLATED . (EMPHASIS ADDED) 20. IN SOLE TRUSTEE, LOK SHIKSHANA TRUST VS. CIT, ( 1975) 101 ITR, 254, THE HONBLE SUPREME COURT OBSERVED: 47 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. IF THE PROFIT MUST NECESSARILY FEED A CHARITABLE P URPOSE UNDER THE TERMS OF THE TRUST, THE MERE FACTS THAT THE ACTIVITIES O THE TRUST YIEL D PROFIT WILL NOT ALTER THE CHARITABLE CHARACTER OF THE TRUST. THE RESTRICTIVE CONDITION THAT PURPOSE SHOULD NOT INVOLVE THE CARRYING ON OF ANY ACTIVITY FOR PROFIT WOULD BE SAT ISFIED IF PROFIT MAKING IS NOT THE OBJECT. 21. IN THE MATTER OF ADDITIONAL CIT VS. SURAT ART SILK CLOTH MANUFACTURES ASSOCIATION, (1980) 121 ITR, 1, THE HONBLE SUPREM E COURT HELD THAT IF THE PRIMARY OR DOMINANT PURPOSE OF A TRUST OR INSTITUTI ON IS CHARITABLE, ANOTHER OBJECT WHICH BY ITSELF MAY NOT BE CHARITABLE BUT WH ICH IS MERELY ANCILLARY OR INCIDENTAL TO THE PRIMARY OR DOMINANT PURPOSE WOULD NOT PREVENT THE TRUST OR INSTITUTION FROM BEING A VALID CHARITY. THE COURT FURTHER OBSERVED THAT TRUE MEANING OF THE WORDS IN SECTION 2(15) VIZ. NOT INV OLVING CARRYING ON ANY ACTIVITY OF PROFIT IS THAT WHEN THE PURPOSE OF A T RUST OR INSTITUTION IS ADVANCEMENT OF AN OBJECT OF GENERAL PUBLIC UTILITY, IT IS THAT OBJECT OF GENRAL PUBLIC UTILITY WHICH MUST NOT INVOLVE CARRYING ON O F ANY ACTIVITY FOR PROFIT AND NOT ITS ADVANCEMENT OR ATTAINMENT. THE COURT OBSER VED THAT WHAT IS INHIBITED BY THESE LAST TEN WORDS IS THE LINKING OF ACTIVITY OR PROFIT WITH THE OBJECT OF GENERAL PUBLIC UTILITY AND NOT ITS LINKING WITH THE ACCOMPLISHMENT OR CARRYING OUT OTHER OBJECT. THUS, SO LONG AS PURPOSE DOES NOT INVOLVE CARRYING ON OR ANY ACTIVITY FOR PROFIT, THE REQUIREMENT OF DEFINIT ION WOULD BE MET AND IT IS IMMATERIAL HOW THE MONEYS FOR ACHIEVING OR IMPLEME NTING SUCH PURPOSE ARE FOUND WHETHER BY CARRYING ON AN ACTIVITY FOR PROFIT OR NOT. 22. IN ANDHRA PRADESH ROAD TRANSPORT CORPORATIONS CASE (SUPRA), THE HONBLE SUPREME COURT WHILE RELYING UPON THE EARLIER DECISI ONS IN THE MATTER OF ADDITIONAL CIT VS. SURAT ART SILK CLOTH MANUFACTUR ES ASSOCIATION, (19800 121 ITR 1 AND CIT VS. BAR COUNCIL OF MAHARASHTRA, (19 81) 130 ITR 28 (SC), HELD THAT IF PREDOMINANT OBJECT IS TO CARRY OUT A CHARIT ABLE PURPOSE AND NOT EARN PROFIT, THE PURPOSE WOULD NOT LOSE ITS CHARITABLE C HARACTER MERELY BECAUSE SOME PROFIT ARISES FROM THE ACTIVITY. 23. IN GUJARAT MARITIME BOARDS CASE (SUPRA), THE HONBE SUPREME COURT AFTER DUE CONSIDERATION OF VARIOUS EARLIER DECISIONS, OBS ERVED: WE HAVE PERUSED A NUMBER OF DECISIONS OF THIS COUR T WHICH HAVE INTERPRETED THE WORDS, IN SECTION 2(150, NAMELY, ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY. FROM THE SAID DECISIONS IT EMERGES THAT THE SAID EXPRESS ION IS OF THE WIDE T CONNOTATION. THE WORD GENERAL IN THE SAID EXPRESSION MEANS PER TAINING TO A WHOLE CLASS. THEREFORE, ADVANCEMENT OF ANY OBJECT OF BENEFIT TO THE PUBLIC OR A SECTION OF THE PUBLIC OR A SECTION OF THE PUBLIC AS DISTINGUISHED FROM BENEFIT TO AN INDIVIDUAL OR A GROUP OF INDIVIDUALS WOULD BE A CHARITABLE PURPOSE ( CIT V. AHMEDABAD RANA CASTE ASSOCIATION [(183) 140 ITR 1 (SC)]. THE SAID EXPR ESSION WOULD PRIMA FACIE INCLUDE ALL OBJECTS WHICH PROMOTE THE WELFARE OF THE GENERAL PU BLIC. IF CANNOT BE SAID THAT A PURPOSE WOULD CEASE TO BE CHARITABLE PURPOSE. WHEN AN OBJECT IS TO PROMOTE OR PROTECT THE INTEREST OF A PARTICULAR TRADE OR INDUS TRY THAT OBJECT BECOMES AN OBJECT OF PUBLIC UTILITY, BUT NOT SO, IF IT SEEKS TO PROMOTE THE INTEREST OF THOSE WHO CONDUCT THE 48 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. SAID TRADE OR INDUSTRY ( CIT V. ANDHRA CHAMBER OF C OMMERCE[1965] 55 ITR 722 (SC)]. IF THE PRIMARY OR PREDOMINANT OBJECT OF ANY INSTI TUTION IS CHARITABLE, ANY OTHER OBJECT WHICH MIGHT NOT BE CHARITABLE BUT WHICH IS A NCILLARY OR INCIDENTAL TO THE DOMINANT PURPOSE, WOULD NOT PREVENT THE INSTITUTION FROM BEING A VALID CHARITY ( ADDL. CIT V. SURAT ART SILK CLOTH MANUFACTURERS ASS OCIATION [1980] 121 ITR 1 (SC). THE PRESENT CASE IN OUR VIEW IS SQUARELY COVERED BY THE JUDGMENT OF THIS COURT IN THE CASE OF CIT V. ANDHRA PRADESH STATE ROAD TRANSPORT CORPO RATION [1986] 159 ITR1 (SC) IN WHICH IT HAS BEEN HELD THAT SINCE THE CORPORATION W AS ESTABLISHED FOR PURPOSE OF PROVIDING EFFICIENT TRANSPORT SYSTEM, HAVING NO PRO FIT MOTIVE, THOUGH IT EARNS INCOME IN THE PROCESS, IF IS NOT LIABLE TO INCOME-TAX. APPLYING THE RATIO OF THE SAID JUDGMENT IN THE CASE OF ANDHRA PRADESH STATE ROAD TRANSPORT CORPORATION [1986] 159ITR 1, WE FIND THA T, IN THE PRESENT CASE, THE GUJARAT MARITIME BOARD IS ESTABLISH FOR THE PREDOMI NANT PURPOSE OF DEVELOPMENT OF MINOR PORTS WITHIN THE STATE OF GUJARAT, THE MANAGE MENT AND CONTROL OF THE BOARD IS ESSENTIALLY WITH THE STATE GOVERNMENT AND THERE IS NO PROFIT MOTIVE, A INDICATED BY THE PROVISIONS OF SECTIONS 73, 74 AND 75 OF THE 198 1 ACT. THE INCOME EARNED BY THE BOARD IS DEPLOYED FOR THE DEVELOPMENT OF MINOR PORT S IN THE STATE OF GUJARAT. IN THE CIRCUMSTANCE , IN OUR VIEW THE JUDGMENT OF THIS COU RT IN ANDHRA PRADESH STATE ROAD TRANSPORT CORPORATION [1986] 159 ITR 1 SQUARELY APP LIES TO THE FACTS OF THE PRESENT CASE. (EMPHASIS ADDED) 24. IN COMMISSIONER OF INCOME TAX V. KRISHI UPAJ M ANDI SAMITI, JAISALMER, (2011) 331 ITR 135 (RAJ.), A BENCH OF THIS COURT WH ILE CONSIDERING THE ENTITLEMENT OF KRISHI UPAJ MANDI SAMITI, A STATUTOR Y BODY, CONSTITUTED AND ESTABLISHED UNDER THE RAJASTHAN AGRICULTURAL PRODUC E MARKET ACT, 1961, OBSERVED THAT MAY BE THE INCOME RECEIVED BY THE SAM ITI BY WAY OF CESS OR MANDI FEES IS NOT SHOWN TO BE SPENT WHOLLY FOR THE PURPOSE OF RELIEF OF THE POOR, EDUCATION, OR MEDICAL RELIEF, BUT UNDER THE S CHEME OF THE ACT, BEING THE RAJASTHAN AGRICULTURAL PRODUCE MARKETS ACT, 1961, T HE ENTIRE AMOUNT RECEIVED BY THE SAMITI IS REQUIRED TO BE SPENT FOR THE PURPO SES MENTIONED THEREIN, WHICH OBVIOUSLY INCLUDE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY. 25. IN LUKHNOW DEVELOPMENT AUTHORITYS CASE (SUPRA) , WHILE EXAMINING THE QUESTION REGARDING APPLICABILITY O PROVISO TO SECTI ON 2(15), ALLAHABAD HIGH COURT OBSERVED: 29. FOR THE APPLICABILITY OF PROVISO TO SECTION 2( 15), THE ACTIVITIES OF THE TRUST SHOULD BE CARRIED OUT ON COMMERCIAL LINES WITH INTENTION T O MAKE PROFIT. WHERE THE TRUST IS CARRYING OUT ITS ACTIVATES ON NON-COMMERCIAL LINES WITH NO MOTIVE TO EARN PROFITS, OR FULFILLMENT OF ITS AIMS AN OBJECTIVES, WHICH ARE CH ARITABLE IN NATURE AND IN THE PROCESS EARN SOME PROFIT, THE SAME WOULD NOT BE HIT BY PROV ISO TO SECTION 2(15). THE AIMS AND OBJECTS OF THE MERE SELLING SOME PRODUCT AT A P ROFIT WILL NOT IPSO FACTO HIT ASSESSEE BY APPLYING PROVISO TO SECTION 2(15) AND D ENY EXEMPTION AVAILABLE UNDER SECTION 11. THE INTENTION OF THE TRUSTEES AND THE MANNER IN WHICH THE ACTIVITIES OF THE CHARITABLE TRUST INSTITUTION ARE UNDERTAKING AR E HIGHLY RELEVANT TO DECIDED THE ISSUE OF APPLICABILITY OF PROVISO TO SECTION 2 (15) . 49 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. 26. COMING TO THE DECISION OF JAMMU & KASHMIR HIGH COURT IN JAMMU DEVELOPMENT AUTHORITYS CASE (SUPRA), RELIED UPON BY LEARNED COUNSEL FOR THE REVENUE, REVEAL THAT THE APPEAL PREFERRED BY THE JA MMU DEVELOPMENT AUTHORITY WAS DISMISSED BY THE COURT OBSERVING THAT THERE ARE FINDINGS OF FACTS THAT THE ASSESSEE-APPELLANT HAS NOT BEEN ACTING TO ADVANCE ANY OF THE OBJECT CONCERNING GENERAL PUBLIC UTILITY. FURTHER WHILE R EFERRING TO FIRST PROVISO TO SECTION 2(15), THE COURT HAS OBSERVED THAT WE FIND THAT NO SUBSTANTIAL QUESTION OF LAW MUCH LESS A SUBSTANTIAL QUESTION OF LAW WOULD EMERGE FROM THE IMPUGNED ORDER OF INCOME TAX APPELLATE TRIBUNAL WARRANTING ADMISSION OF THE APPEAL.A BARE PERUSAL OF THE ORDER REVEAL T HAT THE CATENA OF DECISIONS OF THE HONBLE SUPREME COURT REFERRED TO HEREINABOV E, INTERPRETING THE EFFECT OF FIRST PROVISO IN CONTEXT OF THE MAIN PROVISION O F SECTION 2(15), WHICH DEFINES CHARITABLE PURPOSE, WERE NOT BROUGHT TO THE NOTICE OF THE COURT AND THEREFORE, THE SAID ORDER PASSED BY THE COURT BY ME RELY RECORDING ITS IPSE DIXIT DOES NOT HELP THE REVENUE IN ANY MANNER. 27. FROM VARIOUS DECISIONS OF THE HONBLE SUPREME COURT DISCUSSED HEREINABOVE, THE SETTLED POSITION OF LAW EMERGES IS THAT IF THE PRIMARY OR PREDOMINANT OBJET OF AN INSTITUTION IS CHARITABLE, ANY OTHER WHICH MI GHT NOT BE CHARITABLE BUT WHICH IS ANCILLARY OR INCIDENTAL TO THE DOMINANT PU RPOSE, MAY BE INVOLVING ELEMENT OF PROFIT, WOULD BE PREVENT THE INSTITUTION FROM BEING A VALID CHARITABLE TRUST. IN THE LIGHT OF THE ABOVE BINDING PRECEDENTS, WE AR E UNABLE TO AFFIRM THE VIEW OF THE REVENUE. IN THE PRESENT CASE, MATERIAL AS PL ACED BEFORE US SUGGESTS THAT THE ASSESSING OFFICER IS SWAYED BY THE FIGURES AND VOLU ME OF RECEIPTS. ADMITTEDLY, SUCH RECEIPTS ARE INTERMITTENT AND NOT REGULAR AND ALSO IS DEPENDENT ON THE CONDUCT OF CRICKET MATCH. IT IS NOT OTHER WAY ROUND THAT THE CRICKET MATCHES ARE DEPENDENT UPON SUCH ACTIVITIES. THE UNDISPUTED FACTS ARE THA T THE ASSESSEE IS REGISTERED UNDER THE RAJASTHAN SPORTS (REGISTRATION, RECOGNITION AND REGULATION) ACT 2005 AND FORMED WITH THE OBJECTIVE OF PROMOTING THE SPORTS OF CRICK ET WITHIN THE STATE OF RAJASTHAN SO MAIN OBJECTIVE OR ACTIVITY OF THE ASSESSEE IS PROMO TION OF THE CRICKET. THE ASSOCIATION IS ORGANIZING TOURNAMENT LIKE RANJI TRO PHY, IRANI TROPHY, DILIP TROPHY, MAHARAN BHAGWAT SINGH TROPHY, SALIM DURRANI TROPHY ETC. THE ASSESSING OFFICER HAS NOT DOUBTED ABOUT THESE ACTIVITIES OF THE ASSOCIATI ON. IT IS ALSO BROUGHT TO OUR NOTICE THAT IN THE INTERNATIONAL ONE DAY MATCH BETWEEN SOU TH AFRICA AND INDIA, THE ASSOCIATION SUFFERED DEFICITS OF RS. 1.6 CRORES. I T IS ALSO BROUGHT TO OUR NOTICE THAT THE RCA HAS ALSO INCURRED IN VARIOUS OTHER EXPENSES WITH A VIEW TO PROMOTE THE GAME OF CRICKET VIZ. ON COACHING CAMPS OF RS. 20,40 ,360/-, STATE CRICKET ACTIVITIES OF RS. 1,08,60,566/-, GROUND EXPENSE OF RS. 33,97,435 /- AND INTERNATIONAL TOURNAMENT EXPENSES OF RS. 2,09,16,911/-. THESE FACTS GO TO D EMONSTRATE THAT THE ASSESSEE HAS BEEN PREDOMINANTLY ENGAGED INTO THE ACTIVITY OF PRO MOTING CRICKET MATCH. THE COUNSEL FOR THE ASSESSEE HAS PLACED RELIANCE ON THE JUDGMENT OF THE HONBLE DELHI HIGH COURT RENDERED IN THE CASE OF INSTITUTE OF CHA RTERED ACCOUNTANT VS DIRECTOR GENERAL OF INCOME TAX, WHEREIN THE HONBLE HIGH COU RT HELD THAT EVEN THOUGH FEE ARE CHARGED BY THE PETITIONER INSTITUTE FOR PROVIDI NG COACHING CLASSES AND HOLDING 50 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. INTERVIEWS WITH RESPECT OF CAMPUS PLACEMENT, THE SA ID ACTIVITY CANNOT BE STATED TO BE RENDERING OF SERVICE IN RELATION TO ANY TRADE, C OMMERCE OR BUSINESS AS SUCH ACTIVITIES ARE UNDERTAKEN BY THE PETITIONER INSTITU TE IN FURTHERANCE OF ITS MAIN OBJECT WHICH HAS HELD EARLIER ARE NOT TRADE, COMMERCE OR B USINESS. IN THE PRESENT CASE ALSO THE MAIN ACTIVITY OF THE ASSESSEE IS CONDUCTIN G OF THE CRICKET MATCH WHICH FALLS UNDER THE CATEGORY OF GENERAL PUBLIC UTILITY. THIS FACT IS NOT DISPUTED BY THE REVENUE. ALL THESE ACTIVITIES AN ANCILLARY TO THE MAIN ACTIV ITY. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED IN DECLINING THE EXEMPTION. LD. CIT (DR) VEHEMENTLY URGE THAT FIRST PROVISO TO CLAUSE (15), SECTION 2 OF THE ACT, THEREFORE, AS PER SECTION 13(8) OF THE ACT NOTHING CONTAINED IN SECTION 11 OR SECTION 12 SHALL OPERATE, SO AS TO EXCLUDE OF INCOME OF TOT AL INCOME OF PREVIOUS YEAR OF THE PRESENT. AS WE HAVE HELD THAT IN THE LIGHT OF THE VARIOUS JUDICIAL PRONOUNCEMENT PROVISO TO CLAUSE (15) TO SECTION 2 OF THE ACT WOUL D NOT BE APPLICABLE ON THE FACTS OF THE PRESENT CASE. LD. DR HAS RELIED ON THE DECISI ON OF THE CO-ORDINATE BENCH IN THE CASE OF ENTERTAINMENT SOCIETY OF GOA VS. CIT (2013) 34 TAXMANN.COM 201(PANJI). THIS DECISION DOES NOT HELP THE REVENUE IN VIEW OF JUDGMENTS OF HONBLE MADRAS HIGH COURT AND DELHI HIGH COURT CITED (SUPRA). THER EFORE, THIS ARGUMENT OF THE LD. CIT (DR) IS ALSO DEVOID OF ANY MERIT. TAKING CONSISTENT VIEW, WE HEREBY DIRECT AO TO GRAN T EXEMPTION AS CLAIMED BY THE ASSESSEE. THUS, THE GROUNDS RAISED ARE ALLOWED. 15.3 APROPOS TO GROUND NO. 4.4 AND 4.5 THE LD. COUN SEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS AS MADE IN THE WRITTEN BRIEF. IT I S SUBMITTED THAT THE ASSESSEE COULD NOT CLAIM BENEFIT U/S 11 & 12 ON ACCOUNT OF THE REG ISTRATION HAS BEEN CANCELLED. THEREFORE, ALL TYPES OF VOLUNTARY CONTRIBUTION WERE TREATED AS INCOME UNDER SECTION 2(24). IT IS CONTENDED THAT ONCE THE REGISTRATION IS RESTORED THE AUTHORITIES BELOW OUGHT TO HAVE ALLOWED THE CLAIM. 15.4 ON THE CONTRARY, THE LD. DEPARTMENTAL REPRESEN TATIVES SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 15.5 WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED T HE MATERIAL AVAILABLE ON RECORDS AND GONE THROUGH THE ORDER OF THE AUTHORITI ES BELOW. WE FIND THAT THE ASSESSING OFFICER MADE ADDITION TO INCOME ON THE BA SIS THAT ASSESSEE IS NO LONGER 51 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. ELIGIBLE FOR BENEFIT U/S 11 & 12 OF THE ACT. SINCE , THE REGISTRATION HAS BEEN RESTORED WE ARE OF THE VIEW THAT THIS ISSUE REQUIRES FRESH C ONSIDERATION BY THE ASSESSING OFFICER. THEREFORE, THE ISSUE IS RESTORED TO THE F ILE OF AO FOR DECISION AFRESH. 15.6 GROUND NO. 5 IS AGAINST CONFIRMATION OF DISALL OWANCE OF RS. 50 LAKHS. LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS AS MADE IN THE WRITTEN BRIEF AND SUBMITTED THAT THE ADDITION WAS MADE BY AO ARE BITT ERLY WITHOUT POINTING OUT ANY SPECIFIC EXPENSE TO BE CLAIM EXCESSIVELY IT WAS SUB MITTED BEFORE ASSESSING OFFICER WITH BOOKS ON ACCOUNTS OF THE ASSESSEE WERE DULY AU DITED BY CHARTERED ACCOUNTANT, WHEREIN NO ADVERSE NOTING IS MADE. 15.7 ON THE CONTRARY, LD. DEPARTMENTAL REPRESENTATI VES SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 15.8 WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED T HE MATERIAL AVAILABLE ON RECORDS AND GONE THROUGH THE ORDERS OF THE AUTHORIT IES BELOW. THE LD. CIT(A) HAS DECIDED THE ISSUE IN PARA 13.1 BY OBSERVING AS UNDE R: EVEN AT THE APPELLATE STAGE THE ONLY SUBMISSION O F THE APPELLATE I THAT SINCE THE BOOKS OF ACCOUNT WERE AUDITED BY A CHARTERED AC COUNTANT, THE AO SHOULD HAVE ACCEPTED THE AUTHENTICITY OF THE ACCOUNTS. TH IS, HOWEVER, DOES NOT APPEAR TO BE A VALID ARGUMENT. IF THE AO WERE BOUN D TO ACCEPT ALL THE ACCOUNTS WHICH ARE AUDITED BY AN ACCOUNTANT, THERE WAS NO NEED FOR ANY PROVISION IN THE IT ACT TO ENABLE THE AO TO CALL FO R DETAILS U/S 142(1)/143(2) AND PASS AN ASSESSMENT ORDER U/S 143(3)/144. SINCE THE APPELLANT HAS FAILED TO BRING ANY FACT ON RECORD IN SUPPORT OF THIS GROU ND, I DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE AO ON THIS ISSUE . THE APPEAL ON THIS GROUND, THEREFORE, FAILS. IN OUR CONSIDERED VIEW NEITHER THE ASSESSING OFFICE R NOR THE LD.CIT(A) HAS GIVEN THIS SPECIFIC INSTANCES WITH REGARD TO EXPENSES. ONCE T HE ASSESSEE IS ABLE TO PROVE THE VERACITY ALL THE EXPENDITURE SAME SHOULD NOT BE DIS ALLOWED MERELY ON THE BASIS OF 52 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. THE CONJECTURE. THEREFORE, WE DEEMED IT PROPER TO RESTORE THIS ISSUE TO THE FILE OF THE ASSESSEE FOR DECISION AFRESH. 15.9 NEXT GROUND IS AGAINST CHARGING OF INTEREST WH ICH IS CONSEQUENTIAL IN NATURE, THEREFORE SAME IS DECIDED ACCORDINGLY. 15.10 GROUND NO. 6 IS GENERAL IN NATURE NEEDS NO SE PARATE ADJUDICATION. IN THE RESULT APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 16. IN THE RESULT, APPEAL OF THE ASSESSEE IN ITA NO . 388/JP/2012 (A.Y.2008-09 ) IS PARTLY ALLOWED, WHEREAS APPEAL OF THE REVENUE IN ITA NO. 921/JP/2013 (A.Y.2009- 10) IS DISMISSED AND APPEAL OF THE ASSESSEE IN ITA NO.944/JP/2013 (A.Y.2009-10) IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 17. ORDER PRONOUNCED IN THE OPEN COURT ON 23/3/201 7. SD/- SD/- FOE FLAG ;KNO ( DQY HKKJR ) (VIKRAM SINGH YADAV) ( KUL BHARAT ) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 23 /03/2017. POOJA/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- M/S RAJASTHAN CRICKET ASSOCIATIO N, JAIPUR. 2. THE RESPONDENT- THE ADDITIONAL COMMISSIONER OF I NCOME TAX, RANGE- 2,JAIPUR 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 388/JP/2012, 944/JP/2013 & 9 21/JP/2013) 53 ITA NO.388/JP/2012, 944/JP/2013 & 921/JP/2013 M/S RAJASTHAN CRICKET ASSOCIATION. VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR