Harnam Singh Harbans Kaur Charitable Trust, New Delhi V. DIT(E), New Delhi

ITA 4498/DEL/2011

• Counselvise Citation: 449820114 RSA 2011
• Duration Of Justice: 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 12-12-2011
• Assessment Year: misc
• Appeal Filed On: 07-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SALIL MISHRA
• Assessee Lawyers: SSH K SAMPATH; V RAJA KUMAR S
• Keywords: Charitable institution; Benefit of exemption
• Section: 11A; 80G; 12A; 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH `C: NEW DELHI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI C.L. SETHI, JUDICIAL MEMBER I.T. A. NO.4498/DEL/2011 ASSESSMENT YEAR: ----- HARNAM SINGH HARBANS KAUR DIRECTOR OF INCOME-TAX ( EXEMPTION), CHARITABLE TRUST, 5/49, W E A VS. DELHI. KAROL BAGH, NEW DELHI. PAN: AAATH0372G (APPELLANT) (RESPONDENT ) APPELLANT BY : S/SH. K. SAMPATH & V. RAJA KUMAR, A DVOCATES. RESPONDENT BY : SHRI SALIL MISHRA, SR. DR. O R D E R PER C.L. SETHI, JUDICIAL MEMBER: THE PRESENT APPEAL IS FILED BY THE ASSESSEE TRUST A GAINST THE ORDER DATED 16.08.2011 OF THE LEARNED DIRECTOR OF INCOME-TAX (E XEMPTIONS), DELHI, REJECTING THE ASSESSEES APPLICATION IN FORM NO.10G OF THE INCOME-TAX ACT, 1961 (THE ACT). 2 2. VARIOUS GROUNDS OF APPEAL RAISED BY THE ASSESSEE REVOLVE AROUND THE DIT(E)S ORDER IN DENYING THE EXEMPTION UNDER SEC. 80G(5)(VI) OF THE ACT. 3. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL ON RECORD. 4. IN THIS CASE, THE ASSESSEE TRUST FILED AN APPLIC ATION FOR RENEWAL OF EXEMPTION UNDER SEC. 80G OF THE ACT ON 17.02.2011 I N FORM NO.10G. THE LEARNED DIT(E) REQUIRED THE ASSESSEE TO SUBMIT CERT AIN DETAILS, DOCUMENTS AND EXPLANATIONS, WHICH WERE DULY FURNISHED BEFORE HIM. THE ASSESSEE TRUST HAS BEEN RUNNING UNDER ITS MANAGEMENT A CHARITABLE DISPENSARY AND MEDICAL/HEALTH CENTRE. IT HAS BEEN REGISTERED UNDE R SEC. 12A AS A CHARITABLE TRUST. THE ASSESSEE TRUST HAS BEEN GRANTED RECOGNI TION FOR EXEMPTION UNDER SEC. 80G FROM TIME TO TIME RIGHT FROM ITS INCEPTION THE FIRST BEING DATED 8 TH SEPTEMBER, 1987 AND LAST BEING DATED 2.09.2008 FOR THE PERIOD FROM 1.04.2008 TO 31.3.2011 VIDE ORDER U/S 80G(5)(VI) OF THE ACT. AS PER THE PROVISIONS CONTAINED IN SEC. 80G(5)(VI) OF THE ACT, AS THEY STOOD BEFORE 1.10.2009, THE EXEMPTION UNDER SEC. 80G WAS TO BE G RANTED FOR A PERIOD NOT EXCEEDING FIVE YEARS AT A TIME, AND RENEWAL THEREAF TER. THE ASSESSEE THEREFORE, MADE AN APPLICATION ON 17.02.2011 IN FOR M NO.10G SEEKING EXEMPTION UNDER SEC. 80G OF THE ACT FOR THE PERIOD FROM 1.04.2011 I.E. AFTER THE EXPIRY OF EXEMPTION GRANTED UPTO 31.03.2011VIDE ORDER DATED 2.09.2008. THE ASSESSEES APPLICATION FOR RENEWAL OF EXEMPTION UNDER SEC. 80G WAS 3 CONSIDERED BY THE LEARNED DIT(E) BUT HE WAS OF THE VIEW THAT THE ASSESSEE HAS NOT BEEN ABLE TO ESTABLISH THAT IT SATISFIES TH E CONDITIONS LAID OUT UNDER SEC. 80G(5) OF THE ACT. THEREFORE, THE ASSESSEES APPLICATION FOR RENEWAL OF EXEMPTION UNDER SEC. 80G OF THE ACT, HAS BEEN REJEC TED BY THE DIT(E) VIDE IMPUGNED ORDER. THE REASON GIVEN BY THE DIT(E) FOR REJECTING THE ASSESSEES APPLICATION FOR EXEMPTION UNDER SEC. 80G ARE SET OU T IN PARA 3 & 4 OF HIS ORDER. IN PARA 3 OF HIS ORDER, THE LEARNED DIT(E) HAS STATED THAT THE MEDICAL TREATMENT GIVEN BY THE ASSESSEE TRUST TO THE GENERA L PUBLIC WAS NOT FREE OF COST BUT THE SAME WAS AVAILABLE ON PAYMENT BASIS TH ROUGH ITS HEALTH CENTRES AND THUS, THE CHARGING OF FEE FROM THE PATIENTS BY THE ASSESSEE TRUST IS NOT TENABLE AND CLAIM OF CHARITABLE ACTIVITY CLAIMED TO BE CARRIED OUT BY THE ASSESSEE WAS NOT ACCEPTABLE. THE LEARNED DIT(E) FU RTHER OBSERVED THAT THE ASSESSEE TRUST HAS FAILED TO GIVE ANY DETAILS OF PA TIENTS WHO HAVE BEEN TREATED FREE OF COST IN THEIR HEALTH CENTRES. THE DIT(E) H AS THEREFORE, TAKEN A VIEW THAT THE EARNING OF HUGE MONEY/FEES IN THE NAME OF MEDICAL TREATMENT IS NOTHING BUT THE INCOME FROM COMMERCIAL ACTIVITY CAR RIED OUT UNDER THE GARB OF MEDICAL RELIEF. THE LEARNED DIT(E) HAS ALSO INV OKED THE PROVISIONS CONTAINED IN PROVISO TO SEC. 2(15) OF THE ACT INSER TED BY THE FINANCE ACT, 2008 WITH EFFECT FROM 1.04.2009 AND HELD THAT SINCE THE ASSESSEE TRUST IS ENGAGED IN ANY ACTIVITY OF TRADE, COMMERCE OR BUSIN ESS FOR PROVIDING 4 SERVICES IN RESPECT OF TRADE, COMMERCE OR BUSINESS, THE ACTIVITY OF THE ASSESSEE NO LONGER QUALIFIED TO BE CHARITABLE IN NA TURE AND HENCE, BENEFIT OF EXEMPTION WOULD NO LONGER BE AVAILABLE TO THE ASSES SEE. 5. AT THIS STAGE, IT IS PERTINENT TO NOTE THAT PROV ISO TO CLAUSE (VI) OF SEC. 80G(5) HAS BEEN OMITTED BY THE FINANCE ACT, 2009 W. E.F. 1 ST OCTOBER, 2009. AS PER CLAUSE (VI) OF SEC. 80G(5) OF THE ACT, INSTI TUTION OR FUND TO WHICH DONATIONS ARE MADE HAVE TO BE APPROVED BY THE COMMI SSIONER OF INCOME-TAX IN ACCORDANCE WITH THE RULES PRESCRIBED IN RULE 11A A OF THE INCOME-TAX RULES, 1962. THE PROVISO TO THIS CLAUSE PROVIDED T HAT ANY APPROVAL GRANTED UNDER THIS CLAUSE SHALL HAVE EFFECT FOR SUCH ASSESS MENT YEAR OR YEARS, NOT EXCEEDING FIVE ASSESSMENT YEARS, AS MAY BE SPECIFIE D IN THE APPROVAL. THIS PROVISO IMPOSING THE LIMITATION OF FIVE YEARS HAS B EEN OMITTED BY THE FINANCE ACT, 2009 W.E.F. 1.10.2009 TO PROVIDE THAT THE APPROVAL ONCE GRANTED SHALL CONTINUE TO BE VALID IN PERPETUITY. THE IMPA CT AND SCOPE OF THE OMISSION OF PROVISO TO CLAUSE (VI) OF SUB-SEC. (5) OF SEC. 80G HAS BEEN EXPLAINED BY THE BOARD IN ITS CIRCULAR NO.5 DATED 3 .06.2010 CLARIFYING THAT THE EXISTING APPROVAL EXPIRING ON OR AFTER 1 ST OCTOBER, 2009 WILL BE DEEMED TO HAVE BEEN EXTENDED IN PERPETUITY UNLESS SPECIFIC ALLY WITHDRAWN. THE AFORESAID CIRCULAR READS AS UNDER:- 29.4 FURTHER, AS PER CLAUSE (VI) OF SUB-SECTION 80 G OF THE INCOME-TAX ACT, 1961, THE INSTITUTIONS OR FUNDS TO WHICH THE 5 DONATIONS ARE MADE HAVE TO BE APPROVED BY THE COMMI SSIONER OF INCOME-TAX IN ACCORDANCE WITH THE RULES PRESCRIB ED IN RULE 11AA OF THE INCOME-TAX RULES, 1962. THE PROVISO TO THIS CLAUSE PROVIDES THAT ANY APPROVAL GRANTED UNDER THIS CLAUS E SHALL HAVE EFFECT FOR SUCH ASSESSMENT YEAR OR YEARS, NOT EXCEE DING FIVE ASSESSMENT YEARS, AS MAY BE SPECIFIED IN THE APPROV AL. DUE TO THIS LIMITATION IMPOSED ON THE VALIDITY OF SUCH APP ROVALS, THE APPROVED INSTITUTIONS OR FUNDS HAVE TO BEAR THE HAR DSHIP OF GETTING THEIR APPROVALS RENEWED FROM TIME TO TIME. THIS IS UNDULY BURDENSOME FOR THE BONA FIDE INSTITUTIONS OR FUNDS AND ALSO LEADS TO WASTAGE OF TIME AND RESOURCES OF THE TAX ADMINISTRATION IN RENEWING SUCH APPROVAL SIN A ROUT INE MANNER. 29.5 THEREFORE, THE PROVISO TO CLAUSE (VI) OF SUB-S ECTION (5) OF SECTION 80G HAS BEEN OMITTED TO PROVIDE THAT THE AP PROVAL ONCE GRANTED SHALL CONTINUE TO BE VALID IN PERPETUITY. 29.6 FURTHER, THE COMMISSIONER WILL ALSO HAVE THE P OWER OF WITHDRAW THE APPROVAL IF THE COMMISSIONER IS SATISF IED THAT THE ACTIVITIES OF SUCH INSTITUTION OR FUND ARE NOT GENU INE OR ARE NOT BEING CARRIED OUT IN ACCORDANCE WITH THE OBJECTS OF THE INSTITUTION OR FUND. 29.7 APPLICABILITY. THIS AMENDMENT HAS BEEN MADE APPLICABLE WITH EFFECT FROM 1 ST OCTOBER, 2009. ACCORDINGLY, EXISTING APPROVALS EXPIRING ON OR AFTER 1 ST OCTOBER, 2009 WILL BE DEEMED TO HAVE BEEN EXTENDED IN PERPETUITY UNLESS S PECIFICALLY WITHDRAWN. HOWEVER, IN CASE OF APPROVALS EXPIRING BEFORE 1 ST OCTOBER, 2009, THESE WILL HAVE TO BE RENEWED AND ON CE RENEWED THESE SHALL CONTINUE TO BE VALID IN PERPETUITY, UNL ESS SPECIFICALLY WITHDRAWN. 6. FROM THE AFORESAID CIRCULAR ISSUED IN THE LIGHT OF OMISSION OF THE PROVISO TO CLAUSE (VI) OF SEC. 80G(5), IT IS CLEAR THAT THE OMISSION OF THE PROVISION TO CLAUSE (VI) OF SEC. 80G(5) HAS BEEN MA DE APPLICABLE WITH EFFECT FROM 1 ST OCTOBER, 2009, AND ACCORDINGLY, EXISTING APPROVALS EXPIRING ON OR 6 AFTER 1 ST OCTOBER, 2009 WILL BE DEEMED TO HAVE BEEN EXTENDED IN PERPETUITY UNLESS SPECIFICALLY WITHDRAWN. HOWEVER, IN CASE OF APPROVALS EXPIRING BEFORE 1 ST OCTOBER, 2009, THESE WILL HAVE TO BE RENEWED AND O NCE RENEWED THESE SHALL CONTINUE TO BE VALID IN PERPETUITY, UNL ESS SPECIFICALLY WITHDRAWN. IN THE PRESENT CASE, THE APPROVAL OF EXEMPTION GRAN TED UNDER SEC. 80G OF THE ACT TO THE ASSESSEE VIDE ORDER DATED 2.09.2008 WAS VALID FOR THE PERIOD FROM 1.04.2008 TO 31.03.2011. THUS, THE EXISTING APPROV AL GRANTED VIDE ORDER DATED 2.09.2008, WAS EXPIRING ON 31-03-2011, I.E., AFTER 1 ST OCTOBER, 2009. THEREFORE, THE APPROVAL GRANTED FOR THE PERIOD FROM 1.04.2008 TO 31.03.2011 VIDE ORDER DATED 2.09.2008 SHALL BE DEEMED TO HAVE BEEN EXTENDED IN PERPETUITY UNLESS SPECIFICALLY WITHDRAWN. THEREFOR E, IN THIS CASE, THE FILING OF AN APPLICATION FOR RENEWAL OF EXEMPTION AFTER TH E ALLEGED EXPIRING OF THE SAME ON 31.03.2011 BY THE ASSESSEE WAS NOT REQUIRED . ONCE THE EXEMPTION GRANTED STANDS EXTENDED IN PERPETUITY BY OPERATION OF LAW, MERELY MOVING AN APPLICATION BY THE ASSESSEE TRUST WOULD NOT DIVEST IT OF THE ASSESSEES RIGHT TO TREAT THE EXEMPTION TO HAVE BEEN EXTENDED IN PERPET UITY, WHICH HAD ACCRUED TO THE ASSESSEE IN VIEW OF THE CIRCULAR AFORESAID A ND THE AMENDMENT MADE IN THE ACT. IN THIS CONNECTION, AND TO SUPPORT THIS V IEW, A RELIANCE MAY BE PLACED UPON A DECISION OF HONBLE HIGH COURT OF ALL AHABAD IN THE CASE OF BABU HARGOVIND DAYAL TRUST VS. ITAT (2011) 199 TAXM AN 138 (ALL.), 7 WHERE THE HONBLE HIGH COURT AFTER CONSIDERING THE AMENDMENT MADE IN SEC. 80G(5)(VI) OF THE ACT AND THE BOARD CIRCULAR DATED 3.06.2010, HAS OBSERVED AND HELD AS UNDER:- 6. WE HAVE GONE THROUGH THE RECORD AND WE FIND THA T THE PETITIONER WAS GRANTED EXEMPTION UNDER SECTION 80G ON 8-6- 2009 AND THE SAME WAS VALID UP TO 31-3-2010, BUT IN THE MEANTIME, IN VIEW OF THE CIRCULAR AFORESAID, THE AM ENDMENT WAS MADE PROVIDING THEREIN THAT SUCH EXEMPTION WOUL D CONTINUE IN PERPETUITY UNLESS WITHDRAWN. 7. THE AFORESAID CIRCULAR, IN PARA 28.4 ITSELF SAYS THAT THE AMENDMENT AFORESAID HAS BEEN MADE APPLICABLE WITH E FFECT FROM 1-4-2009 AND WILL ACCORDINGLY APPLY IN RELATIO N TO ASSESSMENT YEAR 2010-11 AND SUBSEQUENT YEARS. IN CLAUSE 29.5, THE CIRCULAR SAYS AS UNDER: THEREFORE, THE PROVISO TO CLAUSE (VI) OF SUB- SECTION (5) OF SECTION 80G HAS BEEN OMITTED TO PROVIDE THAT THE APPROVAL ONCE GRANTED SHALL CONTINUE TO BE VALID IN PERPETUITY. CLAUSE 29.7 OF THE CIRCULAR AFORESAID, READS AS UND ER:- APPLICABILITY. THIS AMENDMENT HAS BEEN MADE APPLICABLE WITH EFFECT FROM 1 ST OCTOBER, 2009. ACCORDINGLY, EXISTING APPROVALS EXPIRING ON OR AFTER 1 ST OCTOBER, 2009 WILL BE DEEMED TO HAVE BEEN EXTENDED IN PERPETUITY UNLESS SPECIFICALLY WITHDRAWN. HOWEVER, IN CASE OF APPROVALS EXPIRING BEFORE 1 ST OCTOBER, 2009, THESE WILL HAVE TO BE RENEWED AND ONCE RENEWED THESE SHALL CONTINUE TO BE VALID IN PERPETUITY, UNLESS SPECIFICALLY WITHDRAWN. 8. SINCE PROVISO TO CLAUSE (VI) OF SUB-SECTION (5) OF SECTION 80G HAS BEEN OMITTED, THERE REMAINS NO REQUIREMENT TO SEEK 8 RENEWAL IN EVERY ASSESSMENT YEAR. THIS STANDS CLAR IFIED IN CLAUSE 29.76 OF THE CIRCULAR AFORESAID. 9. IT BEING ADMITTED THAT THE EXEMPTION WAS EXPIRIN G IN THE INSTANT CASE AFTER 1-10-2009, THE DEEMING PROVISION OF PERPETUITY CLAUSE STOOD ATTRACTED. THAT BEING SO, THE EXEMPTION GRANTED UNDER SECTION 80G WOULD REMAIN OPERATIVE UN LESS WITHDRAWN. 10. IT APPEARS THAT THE PETITIONER SINCE HAS MOVED AN APPLICATION FOR RENEWAL OF THE EXEMPTION ON 31-3-20 10, THE COMMISSIONER OF INCOME-TAX WITHOUT TAKING COGNIZANC E OF THE SAID CIRCULAR/AMENDMENT, REJECTED THE APPLICATION A S WELL AS RENEWAL, AS THE PETITIONER DID NOT TURN UP AFTER NO TICE BEING ISSUED. 11. SRI D.D. CHOPRA SAYS THAT SINCE THE PETITIONER MOVED THE APPLICATION ON 31-3-2010 I.E., BEFORE THE CIRCULAR WAS ISSUED ON 3-6-2010, THEREFORE, THE COMMISSIONER PROCEEDED WITH THE APPLICATION IGNORING THE SAID CIRCULAR. 12. THE APPELLATE TRIBUNAL ALSO DID NOT TAKE INTO A CCOUNT THE EFFECT OF THE CIRCULAR AFORESAID AND REMANDED THE M ATTER FOR AFFORDING OPPORTUNITY TO THE PETITIONER AND PASSING FRESH ORDERS BY THE COMMISSIONER OF INCOME-TAX, IN ACCORDANCE WI TH LAW. 13. MAY THAT BE AT THE TIME OF MOVING THE APPLICATI ON, CIRCULAR AFORESAID WAS NOT IN VOGUE AND IN THE ABSE NCE OF ANY SUCH CIRCULAR HAVING BEEN ISSUED, THE APPLICATION W OULD HAVE BEEN DECIDED IN THE MANNER AS REQUIRED UNDER THE AC T. BUT ONCE A CIRCULAR WAS ISSUED, EVEN DURING THE PENDENC Y OF THE APPLICATION FOR RENEWING THE EXEMPTION ALREADY GRAN TED WHICH WAS IN FORCE IN PERPETUITY AS A CONSEQUENCE OF AMEN DING THE PROVISO TO CLAUSE (VI) OF SUB-SECTION (5) OF SECTIO N 80G, EVEN ON REMAND, THE COMMISSIONER OF INCOME-TAX HAS NO AUTHO RITY TO REFUSE RENEWAL BUT TO DECLARE THE EXEMPTION IN FORC E TILL IT IS ACTUALLY WITHDRAWN. 14. EVEN OTHERWISE, CLAUSE 29.7 OF THE CIRCULAR MAK ES IT VERY CLEAR THAT THE AMENDMENT IN QUESTION AHS BEEN MADE APPLICABLE WITH EFFECT FROM 1-10-2009 AND ACCORDINGLY EXISTING APPROVALS, 9 WHICH WERE TO EXPIRE ON OR AFTER 1-10-2009 WILL BE DEEMED TO HAVE BEEN EXTENDED IN PERPETUITY UNLESS SPECIFICALL Y WITHDRAWN. THIS ITSELF MEANS THAT THE PETITIONERS APPROVAL/EX EMPTION GRANTED UNDER SECTION 80G, WHICH WAS TO EXPIRE ON 3 1-3-2010, WOULD BE DEEMED TO HAVE BEEN EXTENDED IN PERPETUIT Y UNLESS SPECIFICALLY WITHDRAWN. 15. ONCE THE EXEMPTION GRANTED STANDS EXTENDED IN PERPETUITY BY OPERATION OF LAW, MERELY MOVING AN AP PLICATION BY THE PETITIONER WOULD NOT DIVEST IT OF THE AFORES AID RIGHT, WHICH HAD ACCRUED TO IT, IN VIEW OF THE CIRCULAR AF ORESAID AND THE AMENDMENT MADE IN THE ACT. 16. IN THESE CIRCUMSTANCES, THERE IS NO REQUIREMENT OF MAINTAINING THE DIRECTION ISSUED BY THE TRIBUNAL TO THE COMMISSIONER, INCOME-TAX FOR DECIDING THE APPLICATI ON FOR RENEWAL AFRESH, IN ACCORDANCE WITH LAW, AS BY VIRTU E OF OPERATION OF LAW, THE EXEMPTION SHALL BE DEEMED TO BE CONTINUED IN PERPETUITY AND IT WILL CONTINUE, SO LO NG IT IS NOT WITHDRAWN, AS PER THE PROVISIONS OF THE ACT. 7. IN THE LIGHT OF THE ABOVE DISCUSSION AND RELYING UPON THE DECISION OF HONBLE HIGH COURT OF ALLAHABAD IN THE CASE OF BABU HARGOVIND DAYAL TRUST (SUPRA), WE HOLD THAT THE ASSESSEE TRUSTS AP PROVAL/EXEMPTION GRANTED UNDER SEC. 80G VIDE ORDER DATED 2.09.2008 FOR THE P ERIOD FROM 1.04.2008 TO 31.03.2011, WHICH WAS TO EXPIRE ON 31.03.2011, WOUL D BE DEEMED TO HAVE BEEN EXTENDED IN PERPETUITY UNLESS SPECIFICALLY WIT HDRAWN. IN THE PRESENT CASE, IT IS NO DOUBT THAT THE REGISTRATION GRANTED VIDE ORDER DATED 2.09.2008 FOR THE PERIOD FROM 1.04.2008 TO 31.03.2011 HAS NOT BEEN WITHDRAWN BY THE DIT(E) AS PER THE PROVISIONS OF THE ACT. THEREFORE , EXEMPTION GRANTED EARLIER UPTO 31.03.2011 WOULD BE DEEMED TO HAVE BEE N EXTENDED IN 10 PERPETUITY AND IT WILL CONTINUE SO LONG AS IT IS NO T WITHDRAWN, AS PER THE PROVISIONS OF THE ACT. WE FURTHER HOLD THAT MERE B ECAUSE THE ASSESSEE HAS MOVED AN APPLICATION FOR RENEWAL OF EXEMPTION AFTER THE EXPIRY OF ORIGINAL PERIOD OF EXEMPTION UPTO 31.03.2011, WOULD NOT DIVE ST THE ASSESSEE OF ITS RIGHT TO TREAT THE EXEMPTION TO HAVE BEEN EXTENDED IN PERPETUITY UNLESS SPECIFICALLY WITHDRAWN IN VIEW OF THE AMENDMENT MAD E IN THE ACT WITH EFFECT FROM 1.10.2009 READ WITH THE BOARDS AFORESA ID CIRCULAR. WE THEREFORE, HOLD THAT THE ASSESSEE SHALL BE TREATED TO HAVE BEEN APPROVED FOR EXEMPTION U/S 80G OF THE ACT AND THE ORDER OF THE L EARNED DIT(E) DATED 16.08.2011 SHALL STANDS CANCELLED. 8. ONE MORE REASON GIVEN BY THE DIT(E) IS THAT THE ASSESSEES ACTIVITIES ARE HIT BY PROVISO TO SEC. 2(15) OF THE ACT INSERTE D BY THE FINANCE ACT, 2008 W.E.F. 1.04.2009. UNDER THIS PROVISO, IT HAS BEEN PROVIDED THAT THE ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC U TILITY SHALL NOT BE A CHARITABLE PURPOSE, IF IT INVOLVES CARRYING ON OF A NY 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 O R APPLICATION OR RETENTION OF THE INCOME, FROM SUCH ACTIVITY. IT MAKES IT CLEAR THAT THIS PROVISO IS APPLICABLE IN RESPECT OF CHARITABLE INSTITUTIONS EN GAGED IN THE ACTIVITY OF 11 ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC U TILITY I.E. THE 4 TH LIMB OF SEC. 2(15) OF THE ACT. THE FIRST THREE LIMBS, I.E. RELIEF OF THE POOR, EDUCATION AND MEDICAL RELIEF ARE OUTSIDE THE PURVIEW OF THE A FORESAID PROVISO INSERTED TO SEC. 2(15) OF THE ACT. IT HAS BEEN ADMITTED BY THE DIT(E) HIMSELF THAT THE ASSESSEE SOCIETY HAS BEEN REGISTERED UNDER SEC. 12A AS CHARITABLE TRUST AND IS RUNNING DISPENSARY AND HEALTH CENTRE, WHICH MAKES I T CLEAR THAT THE CHARITABLE PURPOSE FOR WHICH THE ASSESSEE SOCIETY I S ESTABLISHED INCLUDES MEDICAL RELIEF, AND IT IS NOT A CASE OF ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY. THEREFORE, APPLYING THE PR OVISIONS OF PROVISO TO SEC. 2(15) OF THE ACT TO THE PRESENT CASE BY THE DIT(E) IS ALSO TOTALLY MISPLACED AND FOR THAT REASON, THE ASSESSEE CANNOT SAID TO BE NOT ELIGIBLE FOR EXEMPTION UNDER SEC. 80G OF THE ACT. FURTHER, THE CHARGING O F FEE FROM THE PATIENTS IN ITSELF CANNOT BE CONSIDERED TO BE A COMMERCIAL ACTI VITY. THE ASSESSEE HAS PRODUCED BEFORE US THE DETAILS OF FEES CHARGED FROM PATIENTS ON VARIOUS COUNTS WHICH GOES TO SHOW THAT THE ASSESSEE HAS BEE N CHARGING A VERY NOMINAL FEE AS COMPARED TO THE MEDICAL INSTITUTIONS OR HOSPITALS OR NURSING HOMES CARRYING ON COMMERCIAL ACTIVITY. IT IS NOT T HE CASE OF THE DIT(E) THAT ALL THE RECEIPTS OR INCOME OF THE ASSESSEE TRUST HA VE NOT BEEN UTILIZED TOWARDS THE OBJECTS OF THE TRUST FOR WHICH IT HAS BEEN ESTA BLISHED. THEREFORE, THE 12 REJECTION OF THE EXEMPTION OR APPROVAL UNDER SEC. 8 0G ON THIS COUNT BY THE LEARNED DIT(E) IS ALSO NOT JUSTIFIED. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE TRUST IS ALLOWED. 10. THIS DECISION IS PRONOUNCED IN THE OPEN COURT O N 16 TH DECEMBER, 2011. SD/- SD/- (G.D. AGRAWAL) (C.L. SETHI) VICE PRESIDENT JUDICIAL MEMBER DATED: 16 TH DECEMBER, 2011 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT. 2. RESPONDENT. 3. CIT 4. CIT(A) 5. DR BY ORDER *MG DEPUTY REGISTRAR, ITAT.