SREE NARAYANA DHARMA PARIPALANA YUVAJANA SAMITHI,KODUNGALLUR V. INCOME TAX OFFICER EXEMPTION WARD- THRISSUR, THRISSUR

ITA 336/COCH/2025

AI Insights

The case involves the Sree Narayana Dharma Paripalana Youvajana Samithi, a charitable trust, which appealed against the order of the Commissioner of Income Tax (Appeals)-5, Mumbai. The primary contention was regarding the assessment of income from a Kuri business run by the trust, which was classified as business income by the Income Tax Officer (Exemption), Thrissur, and not eligible for exemption under Section 11 of the Income Tax Act, 1961. The Tribunal, referencing a similar case and the decision of the Kerala High Court, ruled in favor of the trust, allowing the appeal and directing the deletion of the assessed income.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 668802 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Other Referred Cases: Biowin Agro Research v. ITO (Exemption)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LEENA LAL
• Assessee Lawyers: ANIL KUMAR P.J.
• Keywords: Business income; Charitable institution
• Section: 143(3); 11; 12A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH BEFORE SHRI INTURI RAMA RAO, AM ITA No. 336/Coch/2025 Assessment Year: 2012-13 Sree Narayana Dharma Paripalana .......... Appellant Youvajana Samithi Azhikode, Kodungallur, Thrissur 680666 [PAN: AABAS2078J] vs. The Income Tax Officer (Exemption) .......... Respondent Thrissur Appellant by: Shri Anilkumar P.J., Advocate Respondent by: Smt. Leena Lal, Sr. D.R. Date of Hearing: 26.05.2025 Date of Pronouncement: 23.06.2025 O R D E R Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax (Appeals)-5, Mumbai [CIT(A)] dated 11.03.2025 for Assessment Year (AY) 2012-13. 2. Brief facts of the case are that the appellant is a charitable trust duly registered u/s. 12A of the Income Tax Act, 1961 (the Act). The return of income for AY 2012-13 on 15.03.2013 declaring total income of Rs. 11,39,180/- after claiming exemption u/s. 11 of the Act. Against the said return of income, the assessment was 2 ITA No. 336/Coch/2025 Sree Narayana Dharma Paripalana Youvajana Samithi completed by the ITO (Exemption), Thrissur vide order dated 27.02.2015 passed u/s. 143(3) of the Act at a total income of Rs. 25,75,620/-. While doing so, the AO assessed the income earned from business of Kuri of Rs. 25,75,621/- as business income by rejecting the contention of the appellant that the business is held under the trust for charitable purposes. 3. Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order confirmed the action of the AO by holding that running of Kuri business was not incidental to attainment of objects of the appellant trust. 4. Being aggrieved, the appellant is in appeal before this Tribunal in the present appeal. 5. The learned counsel for the assessee submitted that in earlier assessment years the assessee’s claim for exemption u/s. 11 of the Act was allowed by the Tribunal placing reliance on the decision of the Hon'ble Kerala High Court in the case of Biowin Agro Research v. ITO (Exemption), wherein, it is held that the income of the business is utilised for genuine purposes of the trust or incidental to attainment of the object of the trust, is eligible for exemption u/s. 11 of the Act. 6. On the other hand, the learned Sr. DR supported the orders of the learned lower authorities, submitting that no interference is called for. 3 ITA No. 336/Coch/2025 Sree Narayana Dharma Paripalana Youvajana Samithi 7. I heard the rival contentions and perused the material available on record. The appellant is a trust running business of Kuri. This business is held under trust. The profits earned from this business are utilised for the purpose of achieving the objects of the trust. Therefore, the profits earned from running Kuri business are eligible for exemption u/s. 11 of the Act. This issue is already covered by the decision of the Tribunal in assessee’s own case in ITA Nos. 150 to 154/Coch/2024 vide order dated 08.11.2024. Therefore, I direct the AO to delete the addition. 8. In the result, the appeal filed by the assessee stands allowed. Order pronounced in the open court on 23rd June, 2025. Sd/- (INTURI RAMA RAO) ACCOUNTANT MEMBER Cochin, Dated: 23rd June, 2025 n.p. Copy to: 1. The Appellant 2. The Respondent 3. The Pr. CIT concerned 4. The Sr. DR, ITAT, Cochin 5. Guard File Assistant Registrar ITAT, Cochin "