Assistant Commissioner of Income-tax, V. Mahratta Chamber of Commerce, Industries and Agriculture, Pune

ITA 940/PUN/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 7525 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 2 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-09-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 16-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution; Benefit of exemption
• Section: 143(3); 12A; 11

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI ANIL CHATURVEDI, AM AND SHRI VIKAS AWASTHY, JM . / ITA NOS.939 AND 940/PUN/2015 [ [ / ASSESSMENT YEARS : 2010-11 & 2011-12 ASST.COMMISSIONER OF INCOME TAX, EXEMPTION CIRCLE, 2 ND FLOOR, B.O. BHAVAN, SECTOR NO.47, PLOT NO.1, PUNE SATARA ROAD, PUNE 411 009. . / APPELLANT V/S MAHRATTA CHAMBER OF COMMERCE, INDUSTRIES AND AGRICULTURE, B WING, 5 TH FLOOR, 403-A, MCCIA TRADE TOWER, ICC COMPLEX, SENAPATI BAPAT ROAD, PUNE 411016. PAN : AAATM5559Q. . / RESPONDENT / APPELLANT BY : SHRI AJAY MODI / RESPONDENT BY : SHRI NIKHIL PATHAK / ORDER PER ANIL CHATURVEDI, AM : THESE TWO APPEALS OF THE REVENUE ARE EMANATING OUT OF THE COMMON ORDER OF COMMISSIONER OF INCOME TAX (A) PUNE 10 DATED 22.03.2015 FOR THE ASSESSMENT YEARS 2010-11 AND 2011-12. 2. BEFORE US, AT THE OUTSET, LD.DR SUBMITTED THAT THOUGH THE APPEALS FILED BY THE REVENUE ARE FOR DIFFERENT ASSESSMENT YEARS BUT THE FACTS AND ISSUES INVOLVED IN BOTH THE APPEALS ARE IDENTICAL EXCEPT FOR THE ASSESSMENT YEAR AND THE AMOUNTS INVOLVED AND THEREFORE THE SUBMISSIONS MADE BY HIM WHILE ARGUING ONE APPEAL WOULD BE EQUALLY / DATE OF HEARING : 03.08.2017 / DATE OF PRONOUNCEMENT: 08.09.2017 2 APPLICABLE TO THE OTHER APPEAL ALSO AND THEREFORE, BOTH THE APPEALS CAN BE HEARD TOGETHER. THE AFORESAID SUBMISSION OF THE LD D.R. HAS NOT BEEN OBJECTED TO BY LD.AR. WE THEREFORE FOR THE SAKE OF CONVENIENCE PROCEED TO DISPOSE OF BOTH THE APPEALS BY A CONSOLIDATED ORDER. HOWEVER, WE PROCEED WITH NARRATING THE FACTS FOR ASSESSMENT YEAR 2010- 11. 3. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER :- ASSESSEE IS STATED TO BE A COMPANY REGISTERED U/S 25 OF THE COMPANIES ACT, 1956. IT IS STATED TO BE OPERATING FOR THE PURPOSE OF PROMOTING TRADE, INDUSTRY, COMMERCE AND AGRICULTURE AND IS NOT FOR PROFIT ORGANIZATION REGISTERED U/S 12A OF THE ACT BY CERTIFICATE OF REGISTRATION DT.15.03.1976. ASSESSEE FILED ITS RETURN OF INCOME FOR A.Y. 2010-11 ON 01.10.2010 DECLARING TOTAL INCOME OF RS.NIL BY CLAIMING EXEMPTION U/S 11 OF THE ACT. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER ASSESSMENT WAS FRAMED U/S 143(3) OF THE ACT VIDE ORDER DT.18.03.2013 AND THE TOTAL INCOME WAS DETERMINED AT RS.2,73,10,156/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD.CIT(A), WHO VIDE ORDER DT.22.03.2015 (IN APPEAL NO.PN/CIT(A)- 10/ITO, WD.11(1)/857/13-14) GRANTED SUBSTANTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE ORDER OF LD.CIT(A), REVENUE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS : A) WHETHER IN THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD.CIT(A) WAS RIGHT IN ALLOWING THE BENEFIT OF EXEMPTION UNDER SECTION 11 OF THE ACT WHEN THE ACTIVITIES OF THE ASSESSEE TRUST ARE INTENDED FOR THE PURPOSE OF EARNING PROFIT? WITHOUT PREJUDICE TO THE ABOVE ; 3 B) WHETHER IN THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD.CIT(A) WAS RIGHT IN ALLOWING THE BENEFIT OF EXEMPTION UNDER SECTION 11 OF THE ACT EVEN AFTER TREATING THE ACTIVITIES TO BE FALLING UNDER THE LIMP OF ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY OF SECTION 2(15) AS PROVISION DEBARS THIS BENEFIT WHEN SUCH RECEIPTS EXCEEDS RS.25 LAKHS, AS APPLICABLE IN THIS CASE ? 4. BOTH THE GROUNDS BEING INTER-CONNECTED ARE CONSIDERED TOGETHER. 5. DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND ON PERUSING THE DETAILS FURNISHED BY THE ASSESSEE, AO NOTICED THAT ASSESSEE HAD SHOWN INCOME AGGREGATING TO RS.5.56 CRORES (ROUNDED OFF) COMPRISING OF SUBSCRIPTION (RS.2.01 CRORES), OTHER INCOME (RS.62,10,361/-), RECEIPTS FROM CHAMBER ACTIVITIES RS.2.94 CRORES (ROUNDED OFF), MEMBERSHIP FEE ETC. AO WAS OF THE VIEW THAT THE NATURE OF AFORESAID RECEIPTS WERE HIT BY THE AMENDED PROVISIONS OF SEC.2(15) OF THE ACT AND THAT THE NATURE OF RECEIPTS FROM ACTIVITIES SHOWED THAT ASSESSEE WAS INVOLVED IN CARRYING ON THE ACTIVITIES IN THE NATURE OF TRADE, COMMERCE OR BUSINESS. HE THEREFORE ISSUED SHOW-CAUSE NOTICE TO THE ASSESSEE TO EXPLAIN AS TO WHY EXEMPTION U/S 11 OF THE ACT NOT BE DISALLOWED BY TREATING THE ACTIVITIES AS NOT BEING CHARITABLE. ASSESSEE MADE DETAILED SUBMISSIONS WHICH WERE NOTED BY THE AO IN THE ASSESSMENT ORDER. THE SUBMISSIONS OF THE ASSESSEE WERE HOWEVER NOT FOUND ACCEPTABLE TO AO AS HE WAS OF THE VIEW THAT THE ACTIVITIES CARRIED OUT BY THE ASSESSEE WERE RUN IN A COMMERCIAL MANNER AND THE REVENUES EARNED FROM TRADE EXHIBITIONS, PROGRAM FEES, PUBLICATION REVENUE, REVENUE FROM USE OF FACILITIES, ADVERTISEMENT ON WEBSITE VIDEO CASSETTES HIRING CHARGES ETC. FELL UNDER CLAUSE A, B AND C OF PROVISO OF SEC.2(15) OF THE INCOME TAX ACT, AS AMENDED BY THE FINANCE ACT, 2008. HE THEREFORE HELD THAT THE ASSESSEE DID NOT REMAIN AS A CHARITABLE ORGANIZATION AND ACCORDINGLY DENIED THE CLAIM OF EXEMPTION U/S 11 OF THE ACT AND DETERMINED THE TOTAL INCOME AT RS.2,73,10,156/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE 4 LD.CIT(A), LD.CIT(A) DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE BY HOLDING AS UNDER : 16. I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE AS WELL AS SUBMISSIONS FILED IN THIS REGARD. THE APPELLANT I.E. MAHARATTA CHAMBER OF COMMERCE, INDUSTRIES & AGRICULTURE IS A COMPANY REGISTERED U/S. 25 OF THE COMPANIES ACT, 1956 AND FUNCTIONS AS A SERVICE ORGANIZATION FOR THE DEVELOPMENT AND PROMOTION OF TRADE. THE APPELLANT CLAIMS THAT IT IS NOT A PROFIT ORGANIZATION BUT CARRIES OUT VARIOUS ACTIVITIES FOR ADVANCEMENT OF DOMINANT OBJECTIVE WHICH IS PROMOTION OF TRADE, COMMERCE AND INDUSTRIES. THESE ACTIVITIES LIKE TRADE EXHIBITIONS, PROGRAM FEES, PUBLICATION REVENUE, CERTIFICATE OF ORIGIN, ENERGY CONSULTANCY, REVENUE FROM USE OF FACILITIES, ADVERTISEMENT FROM WEBSITE AND SUBSCRIPTION FEES ARE ONLY FOR ADVANCEMENT OF DOMINANT OBJECTIVE OF THE TRUST WHICH IS PROMOTION OF TRADE, COMMERCE AND INDUSTRY AND THE SURPLUS GENERATED OUT OF THE ABOVE IS ONLY INCIDENTAL AND NOT DONE WITH PROFIT MOTIVE. 17. BEFORE ADJUDICATING THE ISSUE, IT IS IMPORTANT TO GO THROUGH SEC.2(15) OF INCOME-TAX ACT. SECTION 2(15) AFTER THE AMENDMENT MADE BY FINANCE ACT 2010, W.E.F 01.04.2009 IS AS FOLLOWS : XXXX 18. CAREFUL READING OF SEC. 2(15) OF INCOME-TAX ACT AS MODIFIED BY THE 2010 AMENDMENT W.E.F 01.04.2009 SHOWS THAT THIS SECTION EMPLOYS THE COMMON METHOD OF DEFINING AS EXPRESSION USING SPECIFIC CATEGORIES WHICH ARE FOLLOWED BY A GENERAL CATEGORY. THE CATEGORIES RELIEF OF THE POOR, EDUCATION, MEDICAL RELIEF: ETC, ARE SPECIFIC CATEGORIES, AND THESE ARE FOLLOWED, IN THE END BY THE GENERAL CATEGORY OF ADVERTISEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY. THE PURPOSE IS NOT TO RESTRICT THE APPLICATION OF THE DEFINITION, TO JUST THE ENUMERATED CATEGORIES, BUT INSTEAD EXTEND IT TO ALL THE ACTIVITIES WHICH ADVANCE OBJECTS OF GENERAL PUBLIC UTILITY. THE FIRST PROVISO CARRIES OUT AN EXCEPTION WHICH EXCLUDES ADVANCEMENT OF ANY OTHER OBJECT OF GENERAL PUBLIC UTILITY FROM CHARITABLE PURPOSE TO THE EXTENT THAT IT INVOLVES THE CARRYING OF ANY ACTIVITY IN THE NATURE OF TRADE, COMMERCE OR BUSINESS, OR ANY ACTIVITY OF RENDERING ANY SERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS FOR A CESS OR FEE OR ANY OTHER CONSIDERATION, IRRESPECTIVE OF THE NATURE OF USE OR APPLICATION OR RETENTION OF THE INCOME FROM SUCH ACTIVITY. 19. NOW, IN THE LIGHT OF THE ABOVE AMENDMENT, THE ACTIVITIES GENERATING SURPLUS TO THE APPELLANT NEEDS TO BE EXAMINED AS TO WHETHER THESE ACTIVITIES ARE INDEPENDENT PROFIT MAKING ACTIVITY OR ARE CARRIED OUT FOR ADVANCEMENT OF DOMINANT OBJECTIVE OF THE TRUST I.E. ADVANCEMENT OF TRADE, COMMERCE, INDUSTRY ETC. IF THE ACTIVITIES ARE EXAMINED WITH REFERENCE TO DOMINANT OBJECTIVE OF THE TRUST, IT CAN BE SEEN THAT THE SAME HAVE BEEN CARRIED OUT FOR THE ADVANCEMENT OF THE DOMINANT OBJECT OF THE TRUST AND SURPLUS GENERATED OUT OF THE ABOVE, THOUGH SUBSTANTIAL INS ONLY INCIDENTAL TO SUCH ACTIVITIES. THEREFORE, I AM OF THE VIEW THAT THE APPELLANT IS NOT HIT BY PROVISIONS OF SEC.2(15) OF INCOME-TAX ACT AND THE ASSESSING OFFICER HAS BEEN CARRIED AWAY BY HUGE SURPLUS GENERATED OVER THE YEARS WHICH IS IN ANY CASE INCIDENTAL TO THE MAIN OBJECTIVE OF THE TRUST WHICH IS ADVANCEMENT OF TRADE, COMMERCE AND INDUSTRY ETC. AND THE ABOVE MENTIONED ACTIVITIES ARE MERELY A TOOL TO ACHIEVE THE SAME. RELIANCE IS ALSO PLACED ON THE FOLLOWING DECISIONS. (I) INDIAN CHAMBER OF COMMERCE VS. ITO EXEMPTION, KOLKATA, ITA NO.1491/1284/KOL DATED 02.12.2014 5 (II) INDIA TRADE PROMOTION ORGANIZATION[2015] TAXMANN.COM 404(DELHI) 20. ACCORDINGLY, IT IS HELD THAT THE APPELLANT IS NOT HIT BY THE PROVISIONS OF SEC. 2(15) OF INCOME-TAX ACT AND THE ASSESSING OFFICER IS DIRECTED TO ALLOW THE EXEMPTION CLAIMED U/S.11 OF INCOME-TAX ACT. THUS, GROUND NO.2 TO 6 ARE ALLOWED. AGGRIEVED BY THE ORDER OF LD.CIT(A), REVENUE IS NOW IN APPEAL BEFORE US. 6. BEFORE US, LD.DR. TOOK US THROUGH THE VARIOUS OBSERVATIONS OF AO AND STRONGLY SUPPORTED HIS ORDER. HE FURTHER SUBMITTED THAT CBDT VIDE CIRCULAR NO.11/2008 F.N/134/34/2008 TPL DT.19.12.2008 ALSO CLARIFIED THE ISSUE AND HAS HELD THAT WHEN THE ORGANIZATION HAS DEALINGS WITH NON-MEMBERS, THEN THEIR CLAIM OF BEING CHARITABLE ORGANIZATIONS WOULD BE GOVERNED BY THE ADDITIONAL CONDITIONS STIPULATED IN THE PROVISIONS OF SEC.2(15) OF THE ACT. HE SUBMITTED THAT IN THE PRESENT CASE, ASSESSEE WAS ALSO HAVING DEALING WITH NON-MEMBERS. HE FURTHER SUBMITTED THAT THE TERM IN RELATION TO MEANS DIRECTLY RELATABLE TO AND FOR WHICH HE PLACED RELIANCE ON THE DECISION IN THE CASE OF MAXOPP INVESTMENT LIMITED AND OTHERS VS. CIT REPORTED IN (2011) 64 DTR (DEL) 122. LD.AR. ON THE OTHER HAND REITERATED THE SUBMISSIONS MADE BEFORE AO AND LD.CIT(A). HE FURTHER SUBMITTED THAT ASSESSEE HAS BEEN GRANTED REGISTRATION U/S 12A OF THE ACT SINCE 1976 AND HAS BEEN CARRYING OUT SIMILAR ACTIVITIES IN EARLIER YEARS ALSO. HE SUBMITTED THAT ASSESSEE IS A SERVICE ORGANIZATION FOR THE DEVELOPMENT AND PROMOTION OF TRADE, COMMERCE OR BUSINESS, INDUSTRY AND AGRICULTURE AND IS NOT FOR PROFIT ORGANIZATION. HE SUBMITTED THAT THE MAIN OBJECT OF THE ASSESSEE IS TO PROMOTE TRADE, COMMERCE, INDUSTRY, AGRICULTURE AND AGRICULTURAL BUSINESS IN INDIA AND IN PARTICULAR THE TRADE, COMMERCE, INDUSTRY, AGRICULTURE AND AGRICULTURAL BUSINESS IN MAHARASHTRA STATE. HE SUBMITTED THAT THE ASSESSEE WAS NOT CARRYING OUT ANY ACTIVITY IN THE 6 NATURE OF TRADE, COMMERCE AND BUSINESS NOR CARRIED OUT ANY BUSINESS ACTIVITY AND THEREFORE WAS ELIGIBLE FOR BENEFIT OF SEC.11 OF THE ACT. HE SUBMITTED THAT IF SOME RECEIPTS ARE GENERATED IN FURTHERANCE TO ACHIEVE THE OBJECTS OF THE TRUST, SUCH ACTIVITIES ARE NOT HIT BY THE PROVISO TO SEC.2(15) OF THE ACT. LD.A.R. POINTED TO THE MEMORANDUM OF ASSOCIATION AND SUBMITTED THAT THE INCOME DERIVED BY IT HAS TO BE SOLELY APPLIED FOR THE PROMOTION OF ITS OBJECTS AND NO PORTION OF INCOME OR PROFIT CAN BE PAID OR TRANSFERRED DIRECTLY OR INDIRECTLY BY WAY OF DIVIDEND OR BONUS. HE SUBMITTED THAT ASSESSEE ORGANIZES VARIOUS WORK-SHOPS, SEMINARS ETC., FOR THE BENEFIT OF ITS MEMBERS AND BUSINESS COMMUNITY IN GENERAL AND FOR CONTINUING SUCH PROGRAMMES, CHARGES NOMINAL FEE FROM THE PERSONS ATTENDING TO THOSE PROGRAMMES. HE SUBMITTED THAT EVEN THE FACILITIES IN THE FORM OF WEBSITE ADVERTISEMENT OR HIRING OF CASSETTES ARE FOR THE BENEFIT OF MEMBERS AND A VERY NOMINAL INCOME IS GENERATED FROM SUCH ACTIVITIES. HE SUBMITTED THAT THE REVENUE EARNED OUT OF SUCH ACTIVITIES CANNOT BE SAID TO BE ON ACCOUNT OF TRADE AND COMMERCE. HE FURTHER RELIED ON THE DECISION OF DELHI HIGH COURT IN THE CASE OF INDIA TRADE PROMOTION ORGANIZATION VS. DIRECTOR GENERAL OF INCOME-TAX (EXEMPTIONS) REPORTED IN (2015) 53 TAXMANN.COM 404 (DEL) AND THE DECISION OF HON'BLE GUJARAT HIGH COURT IN THE CASE OF SABARMATI ASHRAM (2014) 362 ITR 0539 (GUJ). HE ALSO RELIED ON THE DECISION OF MADRAS TRIBUNAL IN THE CASE OF JAPANESE CHAMBER OF COMMERCE AND INDUSTRIES VS. DIRECTOR OF INCOME TAX (EXEMPTIONS) REPORTED IN (2015) 153 ITD 0690 (CHENNAI). HE THEREFORE SUBMITTED THAT CONSIDERING THE ABOVE SAID FACTS, NO INTERFERENCE TO THE ORDER OF LD.CIT(A) IS CALLED FOR. HE THUS SUPPORTED THE ORDER OF LD.CIT(A). 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO DENIAL OF CLAIM OF 7 DEDUCTION U/S 11 OF THE ACT. IT IS AN UNDISPUTED FACT THAT ASSESSEE IS A COMPANY REGISTERED U/S 25 OF THE COMPANIES ACT, 1956 AND IS NOT FOR PROFIT ORGANIZATION AND IT IS ENGAGED AS SERVICE ORGANIZATION FOR THE DEVELOPMENT AND PROMOTION OF TRADE, COMMERCE AND AGRICULTURE. WE FIND THAT AS PER THE MEMORANDUM OF ASSOCIATION, THE INCOME / PROFIT OF THE ASSESSEE ARE TO BE APPLIED SOLELY FOR THE PROMOTION OF THE OBJECTS SET FORTH IN ITS MEMORANDUM AND NO PORTION OF INCOME OF THE PROPERTY CAN BE PAID OR TRANSFERRED DIRECTLY OR INDIRECTLY BY WAY OF DIVIDEND, BONUS OR OTHERWISE BY WAY OF PROFIT TO ANY PERSON. BEFORE US, NO MATERIAL HAS BEEN PLACED BY REVENUE TO DEMONSTRATE THAT THE ASSESSEE HAS IN ANY WAY DISTRIBUTED OR PAID BONUS OR DIVIDENDS. FURTHER, BEFORE US, NO MATERIAL HAS BEEN PLACED ON RECORD BY REVENUE TO SHOW THAT THE DOMINANT ACTIVITY OF THE ASSESSEE WAS TRADE, BUSINESS OR COMMERCE AND THE DRIVING FORCE WAS TO EARN PROFIT. ON THE ISSUE WHERE THE ASSESSEE HAD EARNED FEE OR SOME OTHER CONSIDERATION AND STILL THE ASSESSEE WAS ELIGIBLE FOR DEDUCTION U/S 11 OF THE ACT, WE FIND THAT HON'BLE DELHI HIGH COURT IN THE CASE OF INDIA TRADE PROMOTION ORGANIZATION (SUPRA) HAS NOTED AS UNDER : 53. FROM THE SAID DECISION, IT IS APPARENT THAT MERELY BECAUSE A FEE OR SOME OTHER CONSIDERATION IS COLLECTED OR RECEIVED BY AN INSTITUTION, IT WOULD NOT LOSE ITS CHARACTER OF HAVING BEEN ESTABLISHED FOR A CHARITABLE PURPOSE. IT IS ALSO IMPORTANT TO NOTE THAT WE MUST EXAMINE AS TO WHAT IS THE DOMINANT ACTIVITY OF THE INSTITUTION IN QUESTION. IF THE DOMINANT ACTIVITY OF THE INSTITUTION WAS NOT BUSINESS, TRADE OR COMMERCE, THEN ANY SUCH INCIDENTAL OR ANCILLARY ACTIVITY WOULD ALSO NOT FALL WITHIN THE CATEGORIES OF TRADE, COMMERCE OR BUSINESS. IT IS CLEAR FROM THE FACTS OF THE PRESENT CASE THAT THE DRIVING FORCE IS NOT THE DESIRE TO EARN PROFITS BUT, THE OBJECT OF PROMOTING TRADE AND COMMERCE NOT FOR ITSELF, BUT FOR THE NATION BOTH WITHIN INDIA AND OUTSIDE INDIA. CLEARLY, THIS IS A CHARITABLE PURPOSE, WHICH HAS AS ITS MOTIVE THE ADVANCEMENT OF AN OBJECT OF GENERAL PUBLIC UTILITY TO WHICH THE EXCEPTION CARVED OUT IN THE FIRST PROVISO TO SECTION 2(15) OF THE SAID ACT WOULD NOT APPLY. WE SAY SO, BECAUSE, IF A LITERAL INTERPRETATION WERE TO BE GIVEN TO THE SAID PROVISO, THEN IT WOULD RISK BEING HIT BY ARTICLE 14 (THE EQUALITY CLAUSE ENSHRINED IN ARTICLE 14 OF THE CONSTITUTION). IT IS WELL-SETTLED THAT THE COURTS SHOULD ALWAYS ENDEAVOUR TO UPHOLD THE CONSTITUTIONAL VALIDITY OF A PROVISION AND, IN DOING SO, THE PROVISION IN QUESTION MAY HAVE TO BE READ DOWN, AS POINTED OUT ABOVE, IN ARUN KUMAR CASE (SUPRA). 8 WE FURTHER FIND THAT THE HON'BLE GUJARAT HIGH COURT IN THE CASE OF SABARMATI ASHRAM GAUSHALA TRUST (SUPRA) HAS HELD AS UNDER : IMPORTANT ELEMENTS OF APPLICATION OF PROVISO TO SECTION 2(15) ARE THAT ENTITY SHOULD BE INVOLVED IN CARRYING ON ACTIVITIES OF ANY TRADE, COMMERCE OR BUSINESS OR ANY ACTIVITIES OF RENDERING SERVICE IN RELATION TO ANY TRADE, COMMERCE OR BUSINESS, FOR A CESS OR FEE OR ANY OTHER CONSIDERATION. ACTIVITY OF A TRUST WOULD BE EXCLUDED FROM TERM CHARITABLE PURPOSE IF IT IS ENGAGED IN ANY ACTIVITY IN NATURE OF TRADE, COMMERCE OR BUSINESS OR RENDERS ANY SERVICE IN RELATION TO TRADE, COMMERCE OR BUSINESS FOR A CESS, FEE AND/OR ANY OTHER CONSIDERATION. IT IS NOT AIMED AT EXCLUDING GENUINE CHARITABLE TRUSTS OF GENERAL PUBLIC UTILITY BUT IS AIMED AT EXCLUDING ACTIVITIES IN NATURE OF TRADE, COMMERCE OR BUSINESS WHICH ARE MARKED AS CHARITABLE PURPOSE. IF ACTIVITIES IN NATURE OF TRADE, COMMERCE OR BUSINESS WHICH ARE MASKED AS CHARITABLE PURPOSE. IF THERE IS ANY SURPLUS GENERATED AT END OF YEAR, THAT BY ITSELF WOULD NOT BE SOLE CONSIDERATION FOR JUDGING WHETHER ANY ACTIVITY IS TRADE, COMMERCE OR BUSINESS, PARTICULARLY IF GENERATING SURPLUSS IS WHOLLY INCIDENTAL TO PRINCIPAL ACTIVITIES OF TRUST; WHICH IS OTHERWISE FOR GENERAL PUBLIC ACTIVITY, AND THEREFORE, OF CHARITABLE NATURE. 8. WE FIND THAT LD.CIT(A) WHILE DECIDING THE ISSUE HAS GIVEN A FINDING THAT THE ACTIVITIES UNDERTAKEN BY THE ASSESSEE SEEN WITH REFERENCE TO THE DOMINANT ACTIVITY OF THE TRUST SHOWS THAT IT HAS BEEN CARRIED OUT FOR THE ADVANCEMENT OF THE DOMINANT OBJECT OF THE TRUST AND THE FEES GENERATION IS ONLY INCIDENTAL TO THE ACTIVITIES CARRIED OUT BY THE ASSESSEE AND ARE NOT HIT AT ALL BY THE PROVISO TO SEC.2(15) OF THE ACT. BEFORE US, REVENUE HAS NOT PLACED ANY MATERIAL ON RECORD TO CONTROVERT THE FINDINGS OF LD.CIT(A). INVIEW OF THE AFORESAID FACTS, WE FIND NO REASON TO INTERFERE WITH THE ORDER OF LD.CIT(A) AND THUS THE GROUNDS OF REVENUE ARE DISMISSED. 9. IN THE RESULT, THE APPEAL OF REVENUE IN ITA NO.939/PUN/2015 IS DISMISSED. 10. AS FAR AS APPEAL IN ITA NO.940/PUN/2015 FOR A.Y. 2011-12 IS CONCERNED, AS THE FACTS OF THE CASE ARE IDENTICAL TO THE FACTS AND ISSUE OF THE CASE IN ITA NO.939/PUN/2015 FOR A.Y. 2010-11 AND AS ACCEPTED BY 9 BOTH THE PARTIES BEFORE US, WE, THEREFORE, FOR THE REASONS STATED HEREIN WHILE DISPOSING OF THE APPEAL IN ITA NO.939/PUN/2015 FOR A.Y. 2010-11 AND FOR SIMILAR REASONS, DISMISS THE GROUNDS OF APPEAL OF REVENUE IN A.Y. 2011-12 ALSO. THUS, THE GROUNDS OF THE REVENUE ARE DISMISSED. 11. IN THE RESULT, THE APPEAL OF REVENUE IN ITA NO.940/PUN/2015 IS DISMISSED. 12. IN THE RESULT, BOTH THE APPEALS OF REVENUE ARE DISMISSED. ORDER PRONOUNCED ON THE 8 TH DAY OF SEPTEMBER, 2017. SD/- SD/- ( VIKAS AWASTHY ) ( ANIL CHATURVEDI ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER PUNE; DATED : 8 TH DAY OF SEPTEMBER, 2017. YAMINI / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3 . 4. 5 6. CIT(A)- PUNE-10. CIT (EXEMPTIONS), PUNE. , , / DR, ITAT, B PUNE; [ / GUARD FILE. / BY ORDER, // TRUE COPY// / SR. PRIVATE SECRETARY , / ITAT, PUNE