The division bench of the Mumbai Income Tax Appellate Tribunal (ITAT), in MIG Cricket Club v. DIT (E), held that the activities of banquette Hall Hiring, Hospiatality and Permit Room are in the nature of trade, commerce and business and therefore are hit by section 2(15) of the Income Tax Act.
The DIT(Exemption) proposed to withdraw the registration granted to the assessee by invoking s. 2(15) on ground that they had income from banquette hall hiring charge, hospitality (Restaurant) and Permit Room (Bar), which exceeded threshold limit of Rs. 10 lacs.
Assessee contended that the Bombay High Court, in assessee’s own case, after considering the activities of the assessee, has held in assessee’s favour and hence exemption was allowed by Revenue in earlier years.
The bench relied on the Bombay High Court decision in DIT(Exemption) v. North Indian Association, and observed that the activities of the assessee of Banquet Hall Hiring, Hospitality (Restaurants) and Permit Room (Bar), in the present case, are in the nature of carrying on trade, commerce, or business for consideration, which are hit by proviso to Section 2(15) of 1961 Act and the receipts from these activities, during the previous year relevant to the impugned assessment year 2009-10, are far in excess of minimum prescribed threshold limit.
The matter was further restored to the files of the DIT(E) to verify whether every activities of the assessee are hit by amended provisions of Section 2(15) of the Income Tax Act.
Read the full text of the Order below.
