The Director Of Income Tax (Exemptions v. M/S. Indian Electrical & Electronic

IN THE HIGH COURT OF JDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 2415 OF 2010 The Director of Income Tax (Exemptions)...Appellant. Vs. M/s. Indian Electrical & Electronic. ..Respondent. Mr. Suresh Kumar for the Appellant. Mr. J.D. Mistri, Sr. Counsel with D. Damodar i/by Kanga & Co.for the Respondent. CORAM : J.P. DEVADHAR AND A.A. SAYED, JJ. DATE : 6TH JULY, 2011. P.C. Two questions of law raised by the revenue in this appeal read thus : 1)Whether in the facts and circumstances of the case and in Dmt law, the Tribunal is right in allowing the exemption U/s 11 of the Act? 2)Whether in the facts and circumstances of the case and in law, the income derived from conducting the exhibitions is taxable as business income or entitled for exemption U/s 11 of the Act as the same is not incidental to the objects of the respondent? 2.The finding of fact recorded by the Commissioner of Income-Tax (A) reads thus : “The main income of about 86% of the trust was from exhibition only. The ITAT agreeing with the assessee that it is the activity of carrying on a business but it was incidental to the objectives of the assessee. There being no change in the facts and following the order of CIT (A) for asst.yr.1992-93 and the order of ITAT it is held that the assessee in organised manner after fixed interval is engaged in the activity for earning some profit by the business but the activity is incidental to the objects. U/s. 11(4A) there are two conditions, a) the business activity should be incidental to the objectives and b) the separate books of accounts should be maintained. The Tribunal has already held that the activities of the assessee for exhibition are incidental to the objectives. In para – 5 of assessment order it is so mentioned that separate books of accounts for exhibition are maintained by the assessee. I, therefore, find that all the conditions U/s. 11 (4A) are satisfied. The assessee is entitled for exemption u/s. 11 on exhibition of income also. The A.O. is directed to recompute the total income considering the exemption u/s. 11 to the assessee.” 3.The order of the Commissioner of Income-Tax has been confirmed by the Income Tax Appellate Tribunal. In our opinion the decision of the Tribunal is based on appreciation of facts. No question of law arises. Dismissed. ( A.A. SAYED, J. )