Printing of books held as incidental business activity thus allowed being exempt from Tax
In a recent ruling in case of Bhartiya Vidyapeeth (Pune) decided by Income Tax Tribunal in Jan 2012, it was held that when a Trust is found to be engaged in imparting degree courses to lakhs of students all over India, printing of books through its own printing press is an incidental business activity and shall be exempt from Income Tax under Section 11 of the Income Tax Act 1961. This ruling will be very relevant for a large number of NGOs, who are presently receiving notices from the Income Tax Dept. questioning several cases of activities which generate income for the NGOs.
Rental Income cannot be taxed just because volume of such income is very high
This decision also dealt with the matter of the charitable trust earning large amount of income from house property. In the impugned case, Income Tax Dept. (DIT (E)) did not give exemption benefit under Section 11 on the ground that the Trust’s rental income is very high and may not go well with its charitable status and on this basis sought to tax it under Income from House property or as Income from Business / profession. The Income Tax Tribunal held that such contention of the Dept. is wrong and further held that such income should be exempted from tax as per provisions of Section 11.
To read complete case, please click the link http://www.srr-foundation.org/itat_orders.pdf
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Sir,
One thing is to be kept in mind that after the amendment of the section 2(15), if the falls in “advancement of any other object of general public utility” as most of them will fall, there is a thresh hold limit for aggregate turn over which is now 25 lakhs in a year.
Regards,
srinivasan