S. 11 : Property held for charitable purposes – “advancement of objects of general public utility”- Income from organizing of Davis Cup up to the limit prescribed as per the second proviso to section 2(15), which for the assessment year under consideration is Rs. 25 lacs, will be treated as income from ‘charitable purposes’ and the assessee will be entitled to claim the exemption u/s 11 of the Act up to that extent in respect of the said income along with other income, if any, from the non-business activity of the assessee. However, the income over and above amount for Rs. 25 lacs from the business activity i.e. from the exploitation of its right to hold Davis Cup will be treated as ‘business income’ of the assessee and will be liable to include in its total income. The assessing officer, therefore, is directed to bifurcate the income from commercial activity and non-commercial activity and assess the income of the assessee as directed above. With the above observations, the appeal of the assessee is treated as partly allowed. [ S.2(15), 10(23C), 13 ]
Chandigarh Lawn Tennis Assoication v. ITO (Chd.)( Trib), www.itatonline.org