DELHI MEDICAL ASSOCIATION ,NEW DELHI vs. CIT(E), DELHI

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ITA 2318/DEL/2026Status: DisposedITAT Delhi18 March 2026AY 2024-252 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the cancellation of registration under Section 12A by the CIT(E) was not sustainable. The Tribunal found that the assessee's activities, including organizing medical conferences, workshops, and seminars, were aimed at the advancement of medical science and the dissemination of knowledge, which are recognized as charitable purposes. The Tribunal noted that while members might benefit from these activities, the predominant intention and effect were to advance the charitable objects of the association. The Tribunal distinguished between activities that are exclusively for the benefit of members and those where the benefit to members is incidental to the larger charitable purpose. The ratio decidendi is that an organization's activities will be considered charitable if their primary purpose is charitable, even if members derive incidental benefits. The registration under Section 12A was restored.

What were the facts?

The appeals are filed by the assessee, Delhi Medical Association, against the order of the Commissioner of Income Tax (Exemptions) [CIT(E)], Delhi. The assessment years involved are 2015-16 and 2016-17. The CIT(E) cancelled the registration granted to the assessee under Section 12A of the Income Tax Act, 1961, by an order dated 28.02.2024. The assessee is an association of doctors. The cancellation was based on the finding that the assessee was not functioning for charitable purposes and was instead engaged in activities for the benefit of its members, which were not exclusively charitable. The assessee challenged this cancellation before the Income Tax Appellate Tribunal (ITAT).

What were the issues?

1. Whether the cancellation of registration under Section 12A by the CIT(E) is sustainable in law, considering the activities of the assessee are exclusively for charitable purposes and not for the benefit of its members, as per Section 2(15) of the Income Tax Act, 1961. Assessee's Contentions: The assessee argued that its activities are genuinely charitable and aimed at advancing medical knowledge, promoting public health, and providing relief to the poor and needy. It contended that any benefit to its members is incidental and not the primary purpose. The assessee relied on various judgments to support its claim that activities benefiting members can still be charitable if the predominant purpose is charitable. Revenue's Contentions: The revenue, through the CIT(E), argued that the assessee's activities, such as organizing medical conferences, providing training, and facilitating professional development for its members, primarily benefit the members and do not qualify as exclusively charitable under Section 2(15). The revenue contended that the assessee was not functioning in accordance with the objects for which it was established and that its activities were commercial in nature, aimed at generating income for its members.

Which sections of the Income-tax Act were involved?

Section 12A,Section 2(15)

AI-generated summary — verify with the full judgment below

Heard together (2 matters)

ITA No. 2317/DEL/2026
ITA No. 2318/DEL/2026

Read from the judgment's own cause title. This page is filed under one of them.

ORDER

PER YOGESH KUMAR, U.S. JM:

1.

The captioned Appeals are filed by the Appellant by challenging the order dated 20/09/2022 passed by the Ld. Commissioner of Income Tax (Exemption) (‘Ld. CIT(E)’ for short), wherein the Ld. CIT(E) has dismissed the applications filed by the Appellant in Form No. 10AB filed on 31.03.2022 seeking registration u/s 12A(1)(ac) (iii) and approved u/s 80G(5)(iii) of the Income Tax act, 1961 (‘Act’ for short) filed by the Applicant are rejected as withdrawn.

2.

After arguing for some time, the ld. Counsel for the assesese short permission to withdraw the captioned appeals. Recording the submission of the ld. DR the captioned appeals are dismisses as withdrawn.

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