COMMISSIONER OF INCOME TAX NEW DELHI Vs. FEDERATION OF INDIAN CHAMBERS OF COMMERCE AND INDUSTRIES NEW DELHI

JUDGEMENT

(1.) In view of the majority opinion of this Court in Additional Commissioner of Income-tax, Gujarat v. Surat Art Silk Cloth manufacturers Association, (1980) 121 ITR 1: ( AIR 1980 SC 387) the reference must be answered against the Revenue and in favour of the assessee.

(2.) SEN, J:-. This direct reference under S. 257 of the Income-tax Act, 1961 (hereinafter referred to as 'the Act') made by the Income-tax Appellate Tribunal, Delhi Bench 'B' at the instance of the Commissioner of Income-tax, Delhi II, New Delhi, raises the much vexed question as to whether the words "not involving the carrying on of any activity for profit" in the definition of 'charitable purpose' contained in S. 2 (15) of the Act, govern the word 'advancement' and not the words 'object of general public utility',

(3.) The facts giving rise to the reference are as follows : The Federation of Indian Chambers of Commerce and Industry, New Delhi - hereinafter referred to as 'the assessee' - is an existing company under the Companies Act, 1956. It was registered under S. 26 of that Act and permitted to omit the word 'Limited' from its name. It has neither any share capital nor does it distribute any dividends to its members. The entire income is expended for the fulfilment of its objects. The main object of the assessee is the promotion, protection and development of trade, commerce and industry in India.