Delhi High Court
Commissioner Of Income Tax ... vs India Hiv Aids Alliance on 1 April, 2022
$~5 & 6
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ ITA 72/2022
COMMISSIONER OF INCOME TAX (EXEMPTIONS) DELHI
..... Appellant
Through Mr. Abhishek Maratha, Advocate.
versus
INDIA HIV AIDS ALLIANCE ..... Respondent
Through Mr. Uddyam Mukherjee and
Mr. Swapnil Pattanayak, Advs.
6
+ ITA 73/2022
COMMISSIONER OF INCOME TAX (EXEMPTIONS) DELHI
..... Appellant
Through Mr. Abhishek Maratha, Advocate.
versus
INDIA HIV AIDS ALLIANCE ..... Respondent
Through Mr. Uddyam Mukherjee and
Mr. Swapnil Pattanayak, Advs.
% Date of Decision: 01st April, 2022
CORAM:
HON'BLE MR. JUSTICE MANMOHAN
HON'BLE MR. JUSTICE DINESH KUMAR SHARMA
JUDGMENT
MANMOHAN, J (Oral):
1. Present appeals have been filed challenging the orders dated 22nd
March, 2021 passed by Income Tax Appellate Tribunal (hereinafter referred
Signature Not Verified
Digitally Signed
By:KRISHNA BHOJ
Signing Date:02.04.2022
18:27:00
to as 'the ITAT') in ITA No.7449/Del./2017 & ITA
No.7450/Del./2017 for the Assessment Years 2013-14 & 2014-15
respectively.
2. Learned counsel for the Appellant submits that the ITAT was not
justified in allowing exemption under Sections 11 and 12 of the Income Tax
Act, 1961 (for short 'Act') to the assessee, when the actual work of the
assessee is to receive and simply transfer grants to other NGOs and the
assessee is found to be charging service charges from its donor in various
forms like management fee, etc. for execution of projects.
3. He also states that the ITAT was not justified in holding that the
activity of the assessee was charitable in nature when the activity carried out
by the assessee yielded income which is commercial in nature.
4. Admittedly, the present case is covered by the decision passed by
learned predecessor Division Bench of this Court in assessee's own case for
the Assessment Year 2010-11 in CIT (Exemption), Delhi vs. M/s India
HIV/AIDS Alliance in ITA 651/2019. The relevant portion of the said
judgment is reproduced herein below:
"2. The short point that is sought to be urged by the
Revenue is whether the Income Tax Appellate Tribunal
(ITAT) was right in holding that the activity of the Assessee
did not cease to be a „charitable activity‟ for the purposes
of Section 2(15) of the Income Tax Act, 1961 (Act) because
the Assessee charged a „management fee‟ for defraying its
administrative expenses.
3. In the impugned order the ITAT has noticed that the
Assessee is a company registered under Section 25 of the
Companies Act. It gives 85% of the donation received by it
to the Government of India for HIV Aids and only 15% of its
total donation is given to other societies for awareness and
Signature Not Verified
Digitally Signed
By:KRISHNA BHOJ
Signing Date:02.04.2022
18:27:00
treatment of poor HIV Patients. The entire amount spent by
the Assessee is through societies and trusts. It also runs its
own project for the welfare of HIV and AIDS patients. In the
above circumstances it has been held that merely because
the Assessee charges management fees to defray the
administrative costs it would not make its essential activity
a business activity.
4. The Court is unable to find any legal infirmity in the
impugned order of the ITAT. No substantial question of law
arises.
5. The appeal is accordingly dismissed."
5. Consequently, no substantial question of law arises for consideration
as the questions sought to be raised in the present appeals are squarely
covered by the decision of this Court. Accordingly, the present appeal is
dismissed.
MANMOHAN, J
DINESH KUMAR SHARMA, J
APRIL 1, 2022
AS
Signature Not Verified
Digitally Signed
By:KRISHNA BHOJ
Signing Date:02.04.2022
18:27:00
