• Oct
  • 02
  • 2013

Club only for members of trust cannot be said to be engaged in charitable activity

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Undisputedly, the objects of the assessee are claimed to promote to help and develop the game of badminton shuttle cock without profit motive. On a specific query being raised by the bench to the assessee as to whether the promotion of the event in question was for the general public or its members only, the response is that it does not cater the general public but confines only to its members. In our view, offering of the so called service to a particular section as in the instant case to members of the assessee organization only does not in any way lead to a charitable activity for the purpose of sec.2(15) of the Act. We reiterate that a charitable activity can not be confined to a particular section but for the society at large. In view of these facts and circumstances, instead of restoring the issue back to the file of CIT, we reject the assessee’s contentions by holding that it is not engaged in any charitable activity.

INCOME TAX APPELLATE TRIBUNAL

BENCH “C” CHENNAI

BEFORE Dr. O.K. NARAYANAN, VICE PRESIDENT AND

SHRI S.S. GODARA, JUDICIAL MEMBER

I.T.A. No.2124/Mds/2012

YONO CLUB TRUST

v.

The Asst. Commissioner of Income Tax

Date of Pronouncement: 26 Aug 2013

ORDER

PER S.S. GODARA, JUDICIAL MEMBER:

This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax, Coimbatore, dated 26.9.2012, passed in Case No.1121/CIT-II/2011-12 under  sec.12AA(1)(B)(ii) of the Income Tax Act, 1961 (in short the Act).

2. A perusal of the case file makes it apparent that the grievance of the assessee in the instant case is that the  Commissioner of Income Tax has wrongly dismissed its application seeking registration under sec.12A of the Act. The assessee claims itself to be a charitable trust. Its stated objects claimed are to help and develop the game of badminton shuttle cock without profit motive. The case file reveals that the assessee trust was constituted vide a trust deed dated 16.9.2008. Thereafter, on 18.3.2010, it chose to file application seeking registration. In proceedings thereof, the CIT sought copy of assessee’s returns for the three preceding assessment years, trust deed, details of its activities, bank statement and donation receipts. As per the order under challenge, the assessee did not appear and produce the same despite opportunities given. Therefore, the CIT held himself was unable to verify the genuineness of the assessee’s objects and activities.  Accordingly, he dismissed the application, which leaves the assessee aggrieved.

3. We have heard both parties. The assessee reiterates the grounds and pleads for acceptance of the appeal on the issue of registration which is opposed by the Revenue. Undisputedly, the objects of the assessee are claimed to promote to help and develop the game of badminton shuttle cock without profit motive. On a specific query being raised by the bench to the assessee as to whether the promotion of the event in question was for the general public or its members only, the response is that it does not cater the general public but confines only to its members. In our view, offering of the so called service to a particular section as in the instant case to members of the assessee organization only does not in any way lead to a charitable activity for the purpose of sec.2(15) of the Act. We reiterate that a charitable activity can not be confined to a particular section but for the society at large. In view of these facts and circumstances, instead of restoring the issue back to the file of CIT, we reject the assessee’s contentions by holding that it is not engaged in any charitable activity.

4. In the result, the appeal is dismissed.

Order pronounced in the open Court after hearing on Monday, the 26th day of August 2013 at Chennai.


One Response to “Club only for members of trust cannot be said to be engaged in charitable activity”

  1. drparasjain says:

    It is submitted that the decision is erroneous and contrary to the well settled principle that society at large means a well defined section of the society as well ( Re Ahmedabad Rana Association )

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