Addl. CIT v. Surat Art Silk Cloth Manufacturers Association

121 ITR 1Supreme Court of India1980#232 most cited

What is Addl. CIT v. Surat Art Silk Cloth Manufacturers Association authority for?

A charitable institution, whose predominant object is general public utility, can engage in non-charitable activities yielding incidental profits, provided these profits are deployed to achieve the dominant charitable object. A subsidiary object, if ancillary to the primary charitable purpose, does not negate the institution's charitable character.

328

judgments rely on this decision, according to BharatTax’s citation analysis of 372,241 Indian tax judgments — from 2001 to 2026.

Also referred to as

Addl CIT v Surat Art Silk Cloth Manufacturers Association · Surat Art Silk · Section 2(15) · Section 11 · charitable purpose · general public utility · dominant object · incidental profit · deployment of profits · unamended Section 2(15) · Section 12 · Section 13(8)

Also reported as

2 Taxmann 501

Sections most often in play

Section 11Section 2(15)Section 12Section 12ASection 13(8)Section 143(3)Section 12AASection 10(20A)

Issues it is cited on

section 52(2)section 10(20a)advancement of general public utilitysection 13(8)section 52proviso to section 2(15)section 11(4a)section 2(15)cancellation of registrationsection 13(3)section 10(23c)section 11(1)

Judgments citing Addl. CIT v. Surat Art Silk Cloth Manufacturers Association

Infoparks Kerala, Cochin vs. The ACIT, Cochin

In the result, the assessee’s appeals are partly allowed

ITA 77/COCH/2015[2011-12]Status: DisposedITAT Cochin11 Aug 2023AY 2011-12

Bench: Shri Sanjay Arora, Am & Shri Aby T. Varkey, Jm

For Appellant: Sri. Rajakannan, AdvocateFor Respondent: Smt. J.M. Jamuna Devi, Sr.AR
Section 11Section 11(1)Section 12ASection 143(3)Section 2(15)

…activity of letting building and vacant lands falls under the head of income ‘income from house property’ (IFHP), and cannot be treated as business income. Reliance stood also placed by it on the decisions in Addl.CIT v. Surat Art and Silk Mfrs. Assn. [1980] 121 ITR 1 (SC); CIT v. Gujarat Maritime Board [2007] 295 ITR 561 (SC); CIT v. Dawoodi Bohra Jamat [2014] 364 ITR 31 (SC); and DIT(E) v. Sabarmati Ashram Gaushala Trust [2014] 362 ITR 539 (Guj). 4.3 Before us, it was a common contention of the parties that the issue is squarely covered by the recent decision by the Hon’ble Apex Court in Asst. CIT v. Ahmedaba…

Infoparks Kerala, Trivandrum vs. The Jt Director of It (OSD) Exem), Cochin

In the result, the assessee’s appeals are partly allowed

ITA 76/COCH/2015[2010-11]Status: DisposedITAT Cochin11 Aug 2023AY 2010-11

Bench: Shri Sanjay Arora, Am & Shri Aby T. Varkey, Jm

For Appellant: Sri. Rajakannan, AdvocateFor Respondent: Smt. J.M. Jamuna Devi, Sr.AR
Section 11Section 11(1)Section 12ASection 143(3)Section 2(15)

…activity of letting building and vacant lands falls under the head of income ‘income from house property’ (IFHP), and cannot be treated as business income. Reliance stood also placed by it on the decisions in Addl.CIT v. Surat Art and Silk Mfrs. Assn. [1980] 121 ITR 1 (SC); CIT v. Gujarat Maritime Board [2007] 295 ITR 561 (SC); CIT v. Dawoodi Bohra Jamat [2014] 364 ITR 31 (SC); and DIT(E) v. Sabarmati Ashram Gaushala Trust [2014] 362 ITR 539 (Guj). 4.3 Before us, it was a common contention of the parties that the issue is squarely covered by the recent decision by the Hon’ble Apex Court in Asst. CIT v. Ahmedaba…

Infoparks Kerala, Trivandrum vs. The Jt Director of It (OSD) Exem), Cochin

In the result, the assessee’s appeals are partly allowed

ITA 75/COCH/2015[2009-10]Status: DisposedITAT Cochin11 Aug 2023AY 2009-10

Bench: Shri Sanjay Arora, Am & Shri Aby T. Varkey, Jm

For Appellant: Sri. Rajakannan, AdvocateFor Respondent: Smt. J.M. Jamuna Devi, Sr.AR
Section 11Section 11(1)Section 12ASection 143(3)Section 2(15)

…activity of letting building and vacant lands falls under the head of income ‘income from house property’ (IFHP), and cannot be treated as business income. Reliance stood also placed by it on the decisions in Addl.CIT v. Surat Art and Silk Mfrs. Assn. [1980] 121 ITR 1 (SC); CIT v. Gujarat Maritime Board [2007] 295 ITR 561 (SC); CIT v. Dawoodi Bohra Jamat [2014] 364 ITR 31 (SC); and DIT(E) v. Sabarmati Ashram Gaushala Trust [2014] 362 ITR 539 (Guj). 4.3 Before us, it was a common contention of the parties that the issue is squarely covered by the recent decision by the Hon’ble Apex Court in Asst. CIT v. Ahmedaba…

Confrere Educational Society, Noida vs. ITO (Exemption), Noida

In the result, the appeal of the assessee is allowed

ITA 4464/DEL/2017[2012-13]Status: DisposedITAT Delhi19 Jun 2023AY 2012-13

Bench: Sh. Anil Chaturvedi & Sh. Anubhav Sharma

Section 12ASection 250Section 251Section 56

…an institution is charitable, any other object which might not be charitable but which is ancillary or incidental to the dominant purpose, would not prevent the institution from being a valid charity—Addl. CIT v. Surat Art Silk Cloth Mfrs. Association [1980] 121 ITR 1 (SC). 15. 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 Corpn. [1986] 159 ITR 1 in which it has been held that since the Corporation ITA Nos.4464 & 4463/Del/2017 Confrere Educational Society vs. ITO(E) 18 was established for the purpose of providing efficie…

Indian Institute of Banking and Finance ( Formerly Known As the Indian Institute of Bankers), Mumbai vs. CIT (Exemptions), Mumbai

In the result, all the appeals by the assessee are dismissed

ITA 875/MUM/2021[2019-21]Status: DisposedITAT Mumbai17 May 2023AY 2019-21

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri Purushottam Tripuri
Section 10Section 10(22)Section 2(15)

…es could be pursued only in a formal atmosphere such as a school or college in the sense in which we know them. The coordinate bench after referring to the decision of the Hon‟ble Supreme Court in ADIT vs Surat Art Silk Cloth Manufacturers‟ Association [1978] 121 ITR 1 (SC) held that the law does not place an embargo on profit- making or surplus resulting, and what is prohibited is profiteering or the profit motive. The coordinate bench further held that the assessee has collected subscriptions from its members including institutional members (banks) which are substantial, which in part have gone to subsidise the…

Indian Institute of Banking and Finance ( Formerly Known As the Indian Institute of Bankers), Mumbai vs. CIT (Exemptions), Mumbai

In the result, all the appeals by the assessee are dismissed

ITA 874/MUM/2021[2016-17]Status: DisposedITAT Mumbai17 May 2023AY 2016-17

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri Purushottam Tripuri
Section 10Section 10(22)Section 2(15)

…es could be pursued only in a formal atmosphere such as a school or college in the sense in which we know them. The coordinate bench after referring to the decision of the Hon‟ble Supreme Court in ADIT vs Surat Art Silk Cloth Manufacturers‟ Association [1978] 121 ITR 1 (SC) held that the law does not place an embargo on profit- making or surplus resulting, and what is prohibited is profiteering or the profit motive. The coordinate bench further held that the assessee has collected subscriptions from its members including institutional members (banks) which are substantial, which in part have gone to subsidise the…

Indian Institution of Banking and Finance (Formerly Known As the India Institute of Bankers), Mumbai vs. CIT (Exemption), Mumbai

In the result, all the appeals by the assessee are dismissed

ITA 6955/MUM/2019[2018-19]Status: DisposedITAT Mumbai17 May 2023AY 2018-19

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri Purushottam Tripuri
Section 10Section 10(22)Section 2(15)

…es could be pursued only in a formal atmosphere such as a school or college in the sense in which we know them. The coordinate bench after referring to the decision of the Hon‟ble Supreme Court in ADIT vs Surat Art Silk Cloth Manufacturers‟ Association [1978] 121 ITR 1 (SC) held that the law does not place an embargo on profit- making or surplus resulting, and what is prohibited is profiteering or the profit motive. The coordinate bench further held that the assessee has collected subscriptions from its members including institutional members (banks) which are substantial, which in part have gone to subsidise the…

The Indian Institute of Banking & Finance ( Formerly Known As the Indian Insitute of Bankers), Mumbai vs. Commissioner of Income Tax (Exemptions), Mumbai

In the result, all the appeals by the assessee are dismissed

ITA 7447/MUM/2018[2017-18]Status: DisposedITAT Mumbai17 May 2023AY 2017-18

Bench: Shri Om Prakash Kant & Shri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri Purushottam Tripuri
Section 10Section 10(22)Section 2(15)

…es could be pursued only in a formal atmosphere such as a school or college in the sense in which we know them. The coordinate bench after referring to the decision of the Hon‟ble Supreme Court in ADIT vs Surat Art Silk Cloth Manufacturers‟ Association [1978] 121 ITR 1 (SC) held that the law does not place an embargo on profit- making or surplus resulting, and what is prohibited is profiteering or the profit motive. The coordinate bench further held that the assessee has collected subscriptions from its members including institutional members (banks) which are substantial, which in part have gone to subsidise the…

M/S Ub Sports Management Overseas Limited, Bangalore vs. Deputy Commissioner of Income Tax(International Taxation) Circle-1(2), Bangalore

In the result, the appeals filed by the assessees are partly allowed

ITA 2930/BANG/2018[2014-15]Status: DisposedITAT Bangalore24 Feb 2023AY 2014-15

Bench: Shri George George K. & Ms. Padmavathy S.

For Appellant: Smt. Manasa Ananthan, AdvocateFor Respondent: Ms. Neera Malthora, CIT-DR
Section 143(2)Section 143(3)Section 92A(2)Section 92C

…ruction. In this context the learned Sr. Counsel relied on the following judicial pronouncements: - i) CIT vs. J.H. Gotla (1985) 23 taxmann 14j (SC) M/s. Palmer Investment Group Ltd. ii) ACIT and Anr. Vs. Surat Art Sil Cotton Manufacturers Association (1979) 2 Taxmann 501 (SC) iii) K.P. Varghese vs. ITO (1981) 7 Taxman 13 (SC) 10. The learned Sr. Counsel further submitted that the agreement entered between unrelated parties cannot be disregarded. In this context the learned Sr. Counsel relied on the order of the Delhi Bench of the Tribunal in the case of Abhisek Auto Industries vs. DCIT reported in (2011) 9 tax…

M/S Palmer Investment Group Limited, Bangalore vs. Deputy Commissioner of Income Tax (International Taxation) Circle-2(1), Bangalore

In the result, the appeals filed by the assessees are partly allowed

ITA 2929/BANG/2018[2014-15]Status: DisposedITAT Bangalore24 Feb 2023AY 2014-15

Bench: Shri George George K. & Ms. Padmavathy S.

For Appellant: Smt. Manasa Ananthan, AdvocateFor Respondent: Ms. Neera Malthora, CIT-DR
Section 143(2)Section 143(3)Section 92A(2)Section 92C

…ruction. In this context the learned Sr. Counsel relied on the following judicial pronouncements: - i) CIT vs. J.H. Gotla (1985) 23 taxmann 14j (SC) M/s. Palmer Investment Group Ltd. ii) ACIT and Anr. Vs. Surat Art Sil Cotton Manufacturers Association (1979) 2 Taxmann 501 (SC) iii) K.P. Varghese vs. ITO (1981) 7 Taxman 13 (SC) 10. The learned Sr. Counsel further submitted that the agreement entered between unrelated parties cannot be disregarded. In this context the learned Sr. Counsel relied on the order of the Delhi Bench of the Tribunal in the case of Abhisek Auto Industries vs. DCIT reported in (2011) 9 tax…

Population Services International, New Delhi vs. CIT(E), New Delhi

In the result, the appeal is allowed

ITA 433/DEL/2021[2016-17]Status: DisposedITAT Delhi30 Nov 2022AY 2016-17

Bench: Shri G.S. Pannu, Hon’Ble & Shri Saktijit Deyassessment Year: 2016-17

Section 10Section 11Section 12ASection 2(15)Section 44ASection 80G

…IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘F’ NEW DELHI BEFORE SHRI G.S. PANNU, HON’BLE PRESIDENT AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER Assessment Year: 2016-17 M/s. Population Services Vs. CIT (E), International, New Delhi C-445, Chittaranjan Park, New Delhi PAN :AAATP1217A (Appellant) (Respondent) Appellant by Sh. Ajay Vohra, Sr. Advocate and Sh. Neeraj Jain, Advocate Respondent by Sh. T. Kipgen, CIT (DR) Date of hearing 21.10.2022 Date of pronouncement 30.11.2022 ORDER PER SAKTIJIT DEY, JM: Captioned appeal has been filed by the assessee assailing the order dated 16.03.2021 passed by learned C…

The Rediant Way School, Raipur (Cg) vs. The the Chif Commisioner of Income Tax, Raipur (Cg)

In the result, the appeal of assessee is allowed

ITA 15/BIL/2017[2013-14]Status: DisposedITAT Raipur21 Sept 2022AY 2013-14
For Appellant: Shri Abhishek Mahawar, CAFor Respondent: Shri P.K.Mishra, CIT-DR
Section 10Section 253

…educational institutions run by it, and the activities of the trust are not for profit. 6, We do not find anything in the decisions in Sole Trustee, Loka Shikshana Trust v. CIT [1975] 101 ITR 234 (SC), Addl CIT v. Surat Art Silk Cloth Mfrs. Association [1980] 121 ITR 1 (SC) or Municipal Corpn. of Delhi v. Children Book Trust [1992] 3 SCC 390, which militates against the view we have taken. All those cases dealt with the scope and effect of the term 'charitable purpose' and as to what exactly was charity. They have no application to this case where the claim is under section 10(22). We do not find any error in the…

Association of Mutual Funds in India, Mumbai vs. DCIT(E)-1(1), Mumbai

In the result, the present appeal is allowed

ITA 5761/MUM/2015[2012-13]Status: DisposedITAT Mumbai06 Sept 2022AY 2012-13
For Appellant: Shri Samir Kapadia/ Nitesh JoshiFor Respondent: Shri Milind Chavan/ Mehul Jain
Section 11Section 12ASection 143(3)Section 2(15)Section 25

…to any trade, commerce or business.” (Emphasis Supplied) ITA. No. 5761 & 5762/Mum/2015 & 6888/Mum/2016 Assessment Years: 2011-12, 2012-13 & 2013-14 13. In the case of Addl. Commissioner of Income Tax v. Surat Art Silk Cloth Manufacturers Association: [1980] 121 ITR 1 (SC), while examining the meaning of „charitable purpose‟ as defined in Section 2(15) of the Act as it stood prior to the abovesaid amendment, the Hon‟ble Supreme Court held as under: '17. The next question that arises is………………….The test which has, therefore, now to be applied is whether the predominant object of the activity involved in carrying…

DCIT (E)-1(1), Mumbai vs. B P Marine Academy, Navi Mumbai

In the result, the appeal filed by the revenue is dismissed

ITA 963/MUM/2019[2014-15]Status: DisposedITAT Mumbai13 Jul 2022AY 2014-15
Section 11Section 12ASection 2(15)

…pugned Appellate Order and also examined courses conducted with the approval of DG Shipping. Apart from this, the ld. CIT(A) also considered the decision of Saint Lawrence Education Society [53 DTR 130(Del)] and Surat Art Silk Cloth Manufacturers Association [121 ITR 1 (SC)] which supports the case of the Assessee before us. We also find that the Assessee obtained various registrations for carrying out educational activities from the Regional Director, Western Region, MCA as filed at page No 140 of paper book, certificate u/s 12AA issued by the DIT(E), Mumbai filed at page No 141 of Paper book, renewal certificat…

Varanasi Development Authority, Varanasee vs. Assistant Commissioner of Income Tax (Exemption), Lucknow

In the result appeal filed by assessee in ITA no

ITA 267/ALLD/2017[2014-15]Status: DisposedITAT Varanasi06 Jul 2022AY 2014-15

Bench: Shri Vijay Pal Rao & Shri Ramit Kochar

For Appellant: ShriAshishBansal, AdvocateFor Respondent: ShriSunil Bajpai, CIT- D.R
Section 11Section 12Section 12ASection 143(3)Section 2(15)

…C) Assessment Year: 2011-12, 2012-13, 2013-14 and 2014-15. M/s. Varanasi Development Authority v. ACIT,Circle-3, Varanasi,U.P. 9.2 Further, in the case of Additional Commissioner of Income-Tax, Gujarat Vs. Surat Art Silk Cloth Manufacturers Association [1980] 121 ITR 1 (SC) a Constitution Bench held that, if primary purpose and predominant object of a trust are to promote welfare of general public, the purpose would be charitable purpose. If primary or predominant object of an institution is charitable, any other object which might not be charitable, but which is ancillary or incidental to dominant purpose, would…

Varanasi Development Authority, Varanasee vs. Assistant Commissioner of Income Tax (Exemption), Lucknow

In the result appeal filed by assessee in ITA no

ITA 266/ALLD/2017[2013-14]Status: DisposedITAT Varanasi06 Jul 2022AY 2013-14

Bench: Shri Vijay Pal Rao & Shri Ramit Kochar

For Appellant: ShriAshishBansal, AdvocateFor Respondent: ShriSunil Bajpai, CIT- D.R
Section 11Section 12Section 12ASection 143(3)Section 2(15)

…C) Assessment Year: 2011-12, 2012-13, 2013-14 and 2014-15. M/s. Varanasi Development Authority v. ACIT,Circle-3, Varanasi,U.P. 9.2 Further, in the case of Additional Commissioner of Income-Tax, Gujarat Vs. Surat Art Silk Cloth Manufacturers Association [1980] 121 ITR 1 (SC) a Constitution Bench held that, if primary purpose and predominant object of a trust are to promote welfare of general public, the purpose would be charitable purpose. If primary or predominant object of an institution is charitable, any other object which might not be charitable, but which is ancillary or incidental to dominant purpose, would…

M/S. Varanasi Development Authority, Varanasi vs. Deputy Commissioner of Income Tax (Exemption), Varanasi

In the result appeal filed by assessee in ITA no

ITA 265/ALLD/2017[2012-13]Status: DisposedITAT Varanasi06 Jul 2022AY 2012-13

Bench: Shri Vijay Pal Rao & Shri Ramit Kochar

For Appellant: ShriAshishBansal, AdvocateFor Respondent: ShriSunil Bajpai, CIT- D.R
Section 11Section 12Section 12ASection 143(3)Section 2(15)

…C) Assessment Year: 2011-12, 2012-13, 2013-14 and 2014-15. M/s. Varanasi Development Authority v. ACIT,Circle-3, Varanasi,U.P. 9.2 Further, in the case of Additional Commissioner of Income-Tax, Gujarat Vs. Surat Art Silk Cloth Manufacturers Association [1980] 121 ITR 1 (SC) a Constitution Bench held that, if primary purpose and predominant object of a trust are to promote welfare of general public, the purpose would be charitable purpose. If primary or predominant object of an institution is charitable, any other object which might not be charitable, but which is ancillary or incidental to dominant purpose, would…

M/S. Varanasi Development Authority, Varanasi vs. Assistant Commissioner of Income Tax, Varanasi

In the result appeal filed by assessee in ITA no

ITA 264/ALLD/2017[2011-12]Status: DisposedITAT Varanasi06 Jul 2022AY 2011-12

Bench: Shri Vijay Pal Rao & Shri Ramit Kochar

For Appellant: ShriAshishBansal, AdvocateFor Respondent: ShriSunil Bajpai, CIT- D.R
Section 11Section 12Section 12ASection 143(3)Section 2(15)

…C) Assessment Year: 2011-12, 2012-13, 2013-14 and 2014-15. M/s. Varanasi Development Authority v. ACIT,Circle-3, Varanasi,U.P. 9.2 Further, in the case of Additional Commissioner of Income-Tax, Gujarat Vs. Surat Art Silk Cloth Manufacturers Association [1980] 121 ITR 1 (SC) a Constitution Bench held that, if primary purpose and predominant object of a trust are to promote welfare of general public, the purpose would be charitable purpose. If primary or predominant object of an institution is charitable, any other object which might not be charitable, but which is ancillary or incidental to dominant purpose, would…

Tata Chemicals Ltd, Mumbai vs. DCIT 2(2), Mumbai

In the result, appeal by the Revenue is dismissed

ITA 2692/MUM/2012[2005-06]Status: DisposedITAT Mumbai06 Jul 2022AY 2005-06

Bench: Shri Pramod Kumar & Shri Sandeep Singh Karhail

For Appellant: Shri Nitesh Joshi a/wFor Respondent: Smt. Somogyan Pal, CIT DR
Section 115JSection 14ASection 250Section 80Section 80HSection 80M

…v. Commissioner of Income-Tax [1975] 101 ITR 234 (SC) the other in Indian Chamber of Commerce v. Commissioner of Income-tax [1975] 101 ITR 796 (SC) and the third in Additional Commissioner of Income-tax v. Surat Art Silk Cloth Manufacturers Association [1980] 121 ITR 1 (SC) where the speech made by the Finance Minister while introducing the exclusionary clause in Section 2 Clause (15) of the Act was relied upon by the Court for the purpose of ascertaining what was the reason for introducing that clause. The speech made by the Finance Minister while moving the amendment introducing Sub-section (2) clearly states w…

DCIT 2(2), Mumbai vs. Tata Chemicals Ltd, Mumbai

In the result, appeal by the Revenue is dismissed

ITA 2553/MUM/2012[2005-06]Status: DisposedITAT Mumbai06 Jul 2022AY 2005-06

Bench: Shri Pramod Kumar & Shri Sandeep Singh Karhail

For Appellant: Shri Nitesh Joshi a/wFor Respondent: Smt. Somogyan Pal, CIT DR
Section 115JSection 14ASection 250Section 80Section 80HSection 80M

…v. Commissioner of Income-Tax [1975] 101 ITR 234 (SC) the other in Indian Chamber of Commerce v. Commissioner of Income-tax [1975] 101 ITR 796 (SC) and the third in Additional Commissioner of Income-tax v. Surat Art Silk Cloth Manufacturers Association [1980] 121 ITR 1 (SC) where the speech made by the Finance Minister while introducing the exclusionary clause in Section 2 Clause (15) of the Act was relied upon by the Court for the purpose of ascertaining what was the reason for introducing that clause. The speech made by the Finance Minister while moving the amendment introducing Sub-section (2) clearly states w…