COMMISSIONER OF INCOME TAX Vs. P IYA NADAR

JUDGEMENT

(1.) In the decision (Commissioner of Income-tax v. P. Iyya Nadar Charitable Trust, 2006 284 ITR 404) this Court considered the question as to (i) whether the Tribunal was right in holding that Section 13(1)(bb) would not apply to the Trust, although it was carrying on business; and (ii) whether the decision of the Supreme Court (Assistant Commissioner of Income-tax v. Thanthi Trust, 2001 247 ITR 785 ) was not squarely applicable to the facts and circumstances of the case. Applying the decision (Assistant Commissioner of Income-tax v. Thanthi Trust, 2001 247 ITR 785), this Court allowed the Revenue's appeal, holding that Section 13(1)(bb) would govern the case of the assessee that it was not entitled to exemption under Section 11.

(2.) Aggrieved by the order of this Court, the assessee went on appeal before the Supreme Court in Civil Appeal No.1679 of 2007. Setting aside the order of this Court, by order dated 26.03.2007, the Apex Court remanded the matter back to this Court for fresh consideration. The Supreme Court pointed out that the Court had not framed substantial questions of law as required under Section 260A of the Income Tax Act. Further, the Apex Court pointed out that this Court had interfered with the concurrent findings given by the authorities below, which was without any reason. On this ground, the judgment was set aside and hence, the cases are listed before us for hearing. The Revenue is on appeal before this Court.

(3.) The assessment years under consideration in T.C.Nos.259 to 261 of 2004 are 1981-82 to 1983-84. T.C.Nos.1547 to 1549 of 2005 also relate to the very same years. It is seen from the facts narrated that as against the orders of assessment for the above years, the assessee went on appeal before the Commissioner of Income Tax (Appeals), who allowed the appeals, holding that Section 13(1)(bb) was not applicable to the assessee's case. The Revenue went on appeal before the Income Tax Appellate Tribunal, which dismissed the Revenue's appeal, holding that when the dominant object of the Trust was charity, exemption under Section 11 could not be denied merely because the Trust carried on the business which was only for the purpose of doing charity. As against the order of the Tribunal, the Revenue filed Reference Applications and this Court, in Tax Case Nos.64 to 66 of 1998, remitted the matter back to the Tribunal, as it had done for earlier assessments in Tax Case Nos.275 to 281 of 1996 by order dated 01.11.2001, for fresh consideration. Tax Case Nos.259 to 261 of 2004 arise out of the order of the Tribunal passed on the remand by the High Court.