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“proviso to section 2(15)”

Charitable TrustsSection 2(15)Section 2(15)581 judgments

The decision most relied on for proviso to section 2(15) is ACIT v. Ahmedabad Urban Development Authority (143 Taxmann.com 278), cited in 390 judgments on BharatTax.

Leading authorities on proviso to section 2(15)

ACIT v. Ahmedabad Urban Development Authority
143 Taxmann.com 278 · 2022 · Supreme Court
390
citing judgments

If activities for the advancement of general public utility are carried on as a business, income from such activities is not exempt under Section 11, even if the profits are utilized for the main charitable object. The argument that profits from general public utility activities can be ploughed back to charity to maintain exemption is not a good law.

India Trade Promotion Organization v. DGIT(Exemption)
371 ITR 333 · 2015 · High Court
128
citing judgments

An institution engaged in the advancement of general public utility retains its charitable character and eligibility for exemptions under Section 11 or approval under Section 10(23C)(iv) provided profit is not its predominant motive, even if it generates incidental surpluses or collects fees.

Khoday Distilleries Ltd. v. State of Karnataka
10 SCC 304 · 1996 · Reported
123
citing judgments

A 'trade' is primarily defined as the exchange of goods for goods or money, and secondarily as a business carried on with a view to profit. The term 'business' is more comprehensive than 'trade', encompassing manufacturing activities.

362 ITR 539 (Gujarat) (d) Institute of Chartered Accountants of India v. DGIT
347 ITR 99 · 2012 · High Court
112
citing judgments

The broad definition of 'business' should not be applied when interpreting the proviso to Section 2(15) of the Income-tax Act, 1961, as the object and purpose of the section must be considered.

Ahmedabad Urban Development Authority v. ACIT
396 ITR 323 · 2017 · High Court
108
citing judgments

Development authorities can continue to be regarded as existing for a 'Charitable Purpose' under Section 2(15) of the Income Tax Act, even after the introduction of the proviso to that section. The contention that such authorities automatically lose their charitable status due to the proviso is incorrect.

Institute of Chartered Accountants of India (ICAI) v. DGIT (Exemptions)
358 ITR 91 · 2013 · High Court
80
citing judgments

An institution carrying out charitable objects, such as education or advancement of general public utility, does not lose its Section 11 exemption merely by collecting fees for activities like campus placements or educational guidance, as this does not constitute carrying on a business.

DIT v. Sabarmati Gaushala Trust
362 ITR 539 · 2014 · High Court
63
citing judgments

Activities of a trust established for the advancement of general public utility do not constitute a 'business' activity if undertaken without private motive, thus qualifying for exemption under Section 11 read with Section 2(15), even when charging fees or receiving consideration.

Commissioner of Sales Tax v. Sai Publication Fund
258 ITR 70 · 2002 · Supreme Court
62
citing judgments

If a charitable organization's dominant activity is not business, then any incidental or ancillary activity performed to achieve its main object will also not be considered 'business,' even if it generates income, provided the primary activity is not driven by a profit intent.

Judgments citing proviso to section 2(15)

M/S. Zilla Nirmiti Kendra Uttara Kannada, Karwar vs. The Assistant Commissioner of Income-Tax (Exemptions), Circle-1, Mangaluru

In the result, appeal by the assessee is dismissed

ITA 2069/BANG/2018[2015-16]Status: DisposedITAT Bangalore16 Feb 2022AY 2015-16

Bench: Shri N.V. Vasudevan & Shri B. R. Baskaranassessment Year :2015-16 M/S. Zilla Nirmiti Kendra Vs. Acit (Exemptions), Uttara Kannada, Circle – 1, 1St Floor, Uttara Kannada, Mangaluru. Karwar. Pan : Aaaaz 0436 G Appellant Respondent Assessee By : Shri. V. Srinivasan, Advocate Revenue By : Shri. Sankar Ganesh K, Jcit(Dr)(Itat), Bengaluru. Date Of Hearing : 14.02.2022 Date Of Pronouncement : 14.02.2022 O R D E R Per N. V. Vasudevan:

For Appellant: Shri. V. Srinivasan, AdvocateFor Respondent: Shri. Sankar Ganesh K, JCIT(DR)(ITAT), Bengaluru
Section 11Section 12ASection 13(8)Section 2(15)

light of the provisions of section 13(8) of the Act which provides that if the proviso to section 2(15) of the Act applies to a case, then the benefits of sections 11 and 12 will not be available to such an assessee. The provisions to section 2(15 ... defines what are charitable purpose. The proviso to section 2(15) of the Act lays down that if the objects of society are advancement of any other general public utility and if the nature of the activity carried on by such society is in the nature of trade, commerce

ITO, Exemptions Ward- 2(2), New Delhi vs. Sondhi Charitable Hospital Society, New Delhi

The appeal of the Department stands dismissed

ITA 5716/DEL/2017[2012-13]Status: DisposedITAT Delhi07 Feb 2022AY 2012-13
Section 11Section 12Section 69

Grounds of appeal Nos. 1, 2 and 3 challenge the denial of exemption under sections 11 and 12 by invoking the proviso to section 2 (15). Since these grounds of appeal are interlinked, these are being adjudicated together. 4.1.1 The Assessing Officer, in the assessment order, has referred ... nature of business commerce and activity falls under the limb advancement of any other object of general public utility and both the provisos to section 2(15) were held to be applicable. 4.1.2 The appellant on the other hand has submitted that the appellant is carrying on the same activities

DCIT(E)-2(1), Mumbai vs. Nehru Centre, Mumbai

In the result, appeal filed by the revenue is dismissed

ITA 7461/MUM/2018[2010-11]Status: DisposedITAT Mumbai04 Feb 2022AY 2010-11

Bench: Shri S. Rifaur Rahman, Hon'Ble & Shri Pavan Kumar Gadale, Hon'Bledcit (E) – 2(1) V. Nehru Centre Room No. 519, 5Th Floor Discovery Of India Building Piramal Chambers, Lalbaug 13Th Floor, Dr. Annie Besant Road Worli, Mumbai - 400018 Mumbai – 400 012 Pan: Aaatn2536J (Appellant) (Respondent) Assessee By : Shri Dilip Thakkar Department By : Shri Dilipkumar Shah

For Appellant: Shri Dilip ThakkarFor Respondent: Shri Dilipkumar Shah
Section 11Section 143(2)Section 2(15)

commercial business and rendering separate books of accounts exhibitions throughout services to trade, commerce maintained. the year of parties. Hit by first proviso to section 2(15). 2. Compensation received 1,05,54,300 At the most as General Public Not incidental as hall was for providing auditorium utility ... rendering mostly. No separate books of conferences / seminars services to trade, commerce accounts maintained. throughout the year of parties. Hit by first proviso to section 2(15). 4. Compensation received 9,77,850 At the most as General Public Not incidental as gallery was for providing art persons utility

Hapur Pilkhuwa Development Authority, Hapur vs. ACIT, Exemption Cirlce, Ghaziabad

ITA 4125/DEL/2017[2012-13]Status: DisposedITAT Delhi04 Feb 2022AY 2012-13

Bench: Shri G.S. Pannu & Shri Kuldip Singhassessment Year: 2012-13

For Appellant: Shri Akhilesh Kumar, AdvocateFor Respondent: Shri S.N. Pandey, Sr. DR
Section 10Section 11Section 12A

exemption is allowed to the assessee-authority. Assessee-authority claimed that its prima facie activity, appearing to fall within the ambit of proviso to section 2(15) make it ineligible for claiming exemption u/s. 11 of the Act. However, Assessee Authority claimed that it is not working for profit ... sale of immovable property, the receipt of which are in excess of Rs.25,00,000/-, being the ceiling stipulated in second proviso of section 2(15) of the Act. 4. Assessing Officer during the assessment proceedings noticed that the assessee has not credited as income an amount of Rs.14,15

All India Liquid Bulk Impoerters & Exporters Asssociation, Mumbai vs. ADIT(E)-II(2), Mumbai

In the result, the appeal filed by the assessee is allowed

ITA 1604/MUM/2020[2011-12]Status: DisposedITAT Mumbai03 Feb 2022AY 2011-12

Bench: Shri Om Prakash Kant & Shri Pavan Kumar Gadaleall India Liquid Bulk Vs. Adit(E)-Ii(2) Importers & Exporters Piramal Chambers, Association Lalbaug, Parel, 501- Mulratna, Mumbai – 400012. 334- Katha Bazar, Masjid, Mumbai – 400009. "थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aagca5018F Appellant .. Respondent Appellant By : Mr.Paresh Shaparia.C.A. Ar Respondent By : Mr.Kailash Mangal.Sr.Dr Date Of Hearing 08.02.2022 Date Of Pronouncement 14.02.2022 आदेश / O R D E R Per Pavan Kumar Gadale Jm: The Assessee Has Filed The Appeal Against The Order Of The Cit(A)-3, Mumbai Passed U/S 143(3) & 250 Of The Income Tax Act, 1961.The Assessee Has Raised The Fallowing Grounds Of Appeal: I. Confirmation Of Treatment Of The Non-Profit Organisation As A Mutual Concern & Denying Exemption U/S 11: 1. The Learned C1.T(A) Erred In Confirming Treatment Of The All Inida Liquid Bulk Importers & Exporters Association, Mumbai. Appellant As A Mutual Association Created Exclusively For The Benefit Of Its Members. 2. The Learned Cit(A) Failed To Appreciate The Fact That The Basic Conditions Of The Concept Of Mutuality Are Not Satisfied, Hence The Same Is Not Applicable To The Appellant.

For Appellant: Mr.Paresh Shaparia.C.A. ARFor Respondent: Mr.Kailash Mangal.Sr.DR
Section 11Section 12ASection 143(2)Section 143(3)Section 25

incorrect because the Kolkata Tribunal in Indian Chamber of Commerce (supra) has considered the effect of the proviso to section 2(15) of the Act in arriving at its conclusion. One of the grievances raised in the appeal filed by Indian Chamber of Commerce (supra) for AY 2009-10 before ... appellant, the Ld. CIT(A) erred in confirming the allegation of the Ld. AO that the appellant was hit by the proviso to section 2(15) of the Income-tax Act inserted w. e.f. 01.04.2009, in as much as the appellant was allegedly involved in the rendering of service

DCIT (E), Ghaziabad vs. M/S Ghaziabad Development Authortiy, Ghaziabad

In the result, both the appeals of the assessee are allowed and the appeal of the Revenue is dismissed

ITA 2156/DEL/2017[2003-04]Status: DisposedITAT Delhi28 Jan 2022AY 2003-04

Bench: Sh.A. D. Jain, Vice-Dr. B. R. R. Kumar

For Appellant: Dr. Rakesh Gupta, AdvFor Respondent: Ms. Meenakshi Goswami, CIT DR
Section 11Section 12ASection 144Section 144A

with section 2(15) of the Act and same cannot be termed as commercial or of business nature for the purpose of proviso to section 2(15) of the Act. 14. Hence, we hold that the decision of the ld. CIT(A) cannot be sustained. Having held that the assessee

DCIT(E), Circle- 1(1), New Delhi vs. Ernet India, Delhi

In the result, both the appeals are dismissed

ITA 2461/DEL/2018[2013-14]Status: DisposedITAT Delhi27 Jan 2022AY 2013-14

Bench: Shri N. K. Billaiyaa N D Shri Amit Shukla(Through Video Conferencing)

For Appellant: Ms. Deepashree Rao, C. AFor Respondent: Ms. Yagyasaini Kakkar
Section 11Section 12ASection 143(3)Section 2(15)

assessment years 2009-10 and 2010-11 have held that assessee is not involved in any trade or business and, therefore, proviso to Section 2(15) of the Act is not attracted. 8. We find that this issue was discussed thread-bare by the Tribunal in the case for assessment

DCIT(E), Circle- 1(1), New Delhi vs. Ernet India, Delhi

In the result, both the appeals are dismissed

ITA 2460/DEL/2018[2014-15]Status: DisposedITAT Delhi27 Jan 2022AY 2014-15

Bench: Shri N. K. Billaiyaa N D Shri Amit Shukla(Through Video Conferencing)

For Appellant: Ms. Deepashree Rao, C. AFor Respondent: Ms. Yagyasaini Kakkar
Section 11Section 12ASection 143(3)Section 2(15)

assessment years 2009-10 and 2010-11 have held that assessee is not involved in any trade or business and, therefore, proviso to Section 2(15) of the Act is not attracted. 8. We find that this issue was discussed thread-bare by the Tribunal in the case for assessment

Deputy Commissioner of Income Tax (Exemptions), Circle-1, Bengaluru vs. Karnataka Industrial Areas Development Board, Bengaluru

In the result, both the appeals filed by revenue are dismissed

ITA 578/BANG/2021[2010-11]Status: DisposedITAT Bangalore05 Jan 2022AY 2010-11

Bench: Shri. Chandra Poojari & Smt. Beena Pillai

For Appellant: Shri
Section 11Section 11(1)(a)Section 143(3)Section 2(15)

This claim was denied in the original assessment (dated 23/11/2011) holding that the assessee is hit by the Proviso to section 2(15) of the Act. In first appeal, the Ld.CIT(A) confirmed the order of the Ld.AO. In second appeal, this Tribunal held that the assessee is working ... profit basis and therefore, the Proviso to section 2(15) does not apply. This Tribunal vide order dated 04/09/2015 in ITA No. 378/Bang/2013 directed the Ld.AO to allow the exemption u/s 11. This Tribunal also held that, the assessee is entitled to benefits of section 11 and that the Proviso

Deputy Commissioner of Income Tax (Exemptions), Circle-1, Bengaluru vs. Karnataka Industrial Areas Development Board, Bengaluru

In the result, both the appeals filed by revenue are dismissed

ITA 577/BANG/2021[2009-10]Status: DisposedITAT Bangalore05 Jan 2022AY 2009-10

Bench: Shri. Chandra Poojari & Smt. Beena Pillai

For Appellant: Shri
Section 11Section 11(1)(a)Section 143(3)Section 2(15)

This claim was denied in the original assessment (dated 23/11/2011) holding that the assessee is hit by the Proviso to section 2(15) of the Act. In first appeal, the Ld.CIT(A) confirmed the order of the Ld.AO. In second appeal, this Tribunal held that the assessee is working ... profit basis and therefore, the Proviso to section 2(15) does not apply. This Tribunal vide order dated 04/09/2015 in ITA No. 378/Bang/2013 directed the Ld.AO to allow the exemption u/s 11. This Tribunal also held that, the assessee is entitled to benefits of section 11 and that the Proviso

DCIT(E), Circle- 2(1), New Delhi vs. National Internet Exchange of India, New Delhi

In the result, the appeal of Revenue is dismissed

ITA 7681/DEL/2018[2010-11]Status: HeardITAT Delhi09 Dec 2021AY 2010-11
Section 11Section 11(4)(a)Section 12ASection 143(3)Section 147Section 164Section 2(15)

erred in ignoring the fact that the assessee’s activities are not charitable in view of the proviso to section 2(15) of the Income Tax Act, 1961. 2. On the basis of facts and circumstances of the case and in law, the Ld. CIT(A) has erred in ignoring ... completed on 12.03.2013 at Rs. 10,08,67,924/- as the assessce was hit by proviso to section 2(15) and AO denied the benefit of section 11(4)(a) to the assessee taxed the whole surplus of Rs. 10,08,67,924/- generated from business activity under section

ITO (E), Ward-1(2), New Delhi vs. Indian Youth Centre Trust, New Delhi

In the result, the appeal of the Revenue is dismissed

ITA 6408/DEL/2018[2014-15]Status: DisposedITAT Delhi07 Dec 2021AY 2014-15

Bench: Shri Kul Bharat & Shri Pradip Kumar Kediaआयकर अपील सं./I.T.A. Nos.6407 & 6408/Del/2018) ("नधा"रण वष" / Assessment Years : 2013-14 & 2014-15)

For Appellant: Shri Ved Jain, Adv
Section 11Section 12ASection 143(3)Section 2(15)Section 80G(5)(vi)

hire in lieu of fee to everyone and was not restricted to members only, was purely commercial in nature and first proviso to section 2(15) of the Act was rightly invoked in the case of the assessee and consequently benefits of exemption of section 11 & 12 rightly denied ... require separate adjudication. 5.2 Grounds of appeal nos. 2 to 6 challenge the denial of exemption u/s 11 by invoking the proviso to section 2(15). Grounds of appeal nos. 10, 11 and 12 which have been admitted as additional grounds of appeal as per discussion in paras

ITO (E), Ward-1(2), New Delhi vs. Indian Youth Centre Trust, New Delhi

In the result, the appeal of the Revenue is dismissed

ITA 6407/DEL/2018[2013-14]Status: DisposedITAT Delhi07 Dec 2021AY 2013-14

Bench: Shri Kul Bharat & Shri Pradip Kumar Kediaआयकर अपील सं./I.T.A. Nos.6407 & 6408/Del/2018) ("नधा"रण वष" / Assessment Years : 2013-14 & 2014-15)

For Appellant: Shri Ved Jain, Adv
Section 11Section 12ASection 143(3)Section 2(15)Section 80G(5)(vi)

hire in lieu of fee to everyone and was not restricted to members only, was purely commercial in nature and first proviso to section 2(15) of the Act was rightly invoked in the case of the assessee and consequently benefits of exemption of section 11 & 12 rightly denied ... require separate adjudication. 5.2 Grounds of appeal nos. 2 to 6 challenge the denial of exemption u/s 11 by invoking the proviso to section 2(15). Grounds of appeal nos. 10, 11 and 12 which have been admitted as additional grounds of appeal as per discussion in paras

ITO (E), New Delhi vs. M/S. St. John Ambulance Association, New Delhi

In the result, the appeal of the Revenue in ITA No

ITA 55/DEL/2017[2012-13]Status: DisposedITAT Delhi03 Dec 2021AY 2012-13

Bench: Ms. Diva Singh & Shri N.K. Billaiya

For Appellant: Shri Arun Kishore, CAFor Respondent: Shri Umesh Takyar, Sr. DR
Section 12ASection 2(15)Section 80G

fact that the activities of the assessee are commercial in nature and squarely fall under the ‘General Public Utility’ and hits the proviso to Section 2(15) of the Income-tax Act, 1961 [hereinafter referred to as 'The Act']. 3. Briefly stated, the facts of the case are that ... lakhs, the activities carried on by the assessee falls under ‘Advancement of any other object of public utility’ and accordingly, applying proviso to section 2(15) of the Act, income of the assessee was assessed as normal AOP and denied exemption of income u/ss

ITO (E), Ward-1(1), Delhi vs. Association of Corporation & Apex Societies of Handlooms, New Delhi

In the result, the appeal of the Revenue is dismissed

ITA 7646/DEL/2018[2015-16]Status: DisposedITAT Delhi10 Nov 2021AY 2015-16

Bench: Shri G.S. Pannu & Shri K. Narasimha Charyassessment Year: 2015-16

For Appellant: Sh. Padampani Bora, Sr. DRFor Respondent: Sh. KVSR Krishnan, Adv
Section 11Section 12ASection 143(3)Section 2(15)

contributors and participators in a common fund, the principle of mutuality would not be attracted and after discussing the amendment to the proviso to section 2(15) and CBDT Circular No. 11/2008 dated 19.12.2008, determined the income of the assessee at Rs.1,95,17,220/-. 4. Assessee preferred appeal, aggrieved ... facilities to Member Societies for fee, which is not charitable to qualify for exemption under the concept of mutuality and therefore, the proviso to section 2(15) of the Act is attracted and the assessee is not entitled to the benefit of exemption u/s. 11 of the Act. 6. Learned

ITO(Expeption) Ward-1(1), New Delhi vs. All India Fine Arts & Crafts Society, New Delhi

In the result, appeals of the Revenue are dismissed and Appeals of the Assessee are allowed for statistical purposes

ITA 1648/DEL/2018[2014-15]Status: DisposedITAT Delhi14 Oct 2021AY 2014-15

Bench: Smt. Diva Singh & Shri O.P. Kant

Section 11(3)Section 2(15)Section 251(2)

field of charitable purpose as defined under section 2(15) of the I.T. Act, 1961 and are clearly hit by proviso to section 2(15) of the Act. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in holding ... each and every case has to be seen in light of the facts present therein and as a general rule the first proviso to section 2(15) cannot be applied without considering the peculiar facts of the case at hand and, thus only on receipt of some incidental incomes

ITO (Exception) Ward-1(1), New Delhi vs. All India Fine Arts & Crafts Society, New Delhi

In the result, appeals of the Revenue are dismissed and Appeals of the Assessee are allowed for statistical purposes

ITA 1647/DEL/2018[2013-14]Status: DisposedITAT Delhi14 Oct 2021AY 2013-14

Bench: Smt. Diva Singh & Shri O.P. Kant

Section 11(3)Section 2(15)Section 251(2)

field of charitable purpose as defined under section 2(15) of the I.T. Act, 1961 and are clearly hit by proviso to section 2(15) of the Act. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in holding ... each and every case has to be seen in light of the facts present therein and as a general rule the first proviso to section 2(15) cannot be applied without considering the peculiar facts of the case at hand and, thus only on receipt of some incidental incomes

All India Fine Arts & Crafts Society, New Delhi vs. It((Expeption) Ward-1(1), New Delhi

In the result, appeals of the Revenue are dismissed and Appeals of the Assessee are allowed for statistical purposes

ITA 1631/DEL/2018[2014-15]Status: DisposedITAT Delhi14 Oct 2021AY 2014-15

Bench: Smt. Diva Singh & Shri O.P. Kant

Section 11(3)Section 2(15)Section 251(2)

field of charitable purpose as defined under section 2(15) of the I.T. Act, 1961 and are clearly hit by proviso to section 2(15) of the Act. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in holding ... each and every case has to be seen in light of the facts present therein and as a general rule the first proviso to section 2(15) cannot be applied without considering the peculiar facts of the case at hand and, thus only on receipt of some incidental incomes

All India Fine Arts & Crafts Society, New Delhi vs. ITO (E), Ward-1(1), New Delhi

In the result, appeals of the Revenue are dismissed and Appeals of the Assessee are allowed for statistical purposes

ITA 1630/DEL/2018[2013-14]Status: DisposedITAT Delhi14 Oct 2021AY 2013-14

Bench: Smt. Diva Singh & Shri O.P. Kant

Section 11(3)Section 2(15)Section 251(2)

field of charitable purpose as defined under section 2(15) of the I.T. Act, 1961 and are clearly hit by proviso to section 2(15) of the Act. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in holding ... each and every case has to be seen in light of the facts present therein and as a general rule the first proviso to section 2(15) cannot be applied without considering the peculiar facts of the case at hand and, thus only on receipt of some incidental incomes

ACIT, New Delhi vs. M/S. Maharaji Education Trust, Ghaziabad

The appeal are dismissed

ITA 5138/DEL/2016[2007-08]Status: DisposedITAT Delhi13 Oct 2021AY 2007-08

Bench: Shri Kuldip Singh & Shri Prashant Maharishi(Through Video Conferencing)

For Appellant: Shri Suresh Gupta, C. AFor Respondent: Ms. Paramita M. Biswas[CIT]–
Section 11Section 12ASection 132Section 133ASection 143(1)Section 143(2)Section 143(3)Section 68Section 69Section 69C

within the ambit of the above proviso. The CBDT Circular No.11/2008 dt: 19.12.2008 in para 2.1 clarifies that “The newly inserted proviso to section 2(15) will not apply in respect of the first three limbs of section 2(15), i.e., relief of the poor, education or medical relief. Consequently