KUPPUSWAMY NAIDU G MEMORIAL SPORTS TRUST Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE petitioner is one G. Kuppuswamy Naidu Memorial Sports Trust, Kovilpatti. THE trust is said to have been created under a deed of trust dated August 12, 1960, by one K.R. Appaswami Naidu, with the object of encouraging sports of all kinds, building stadia, maintaining play grounds and doing all such acts and things for the promotion of sporting activity of all kinds all over India in general and in Kovilpatti in particular. It is claimed that the trust has been conducting various sports activities, particularly Hockey tournaments, at Kovilpatti and also promoting other sports activities.

(2.) IT appears the Commissioner of Income-tax granted a certificate under Section 88 of the Income-tax Act, 1961 (hereinafter called "the Act"), to the effect that donations to the trust would be exempt from tax. Later, the said certificate was cancelled on the ground that an association encouraging sports will be specifically covered by Section 10(23) of the Act and it was suggested that an application for exemption under Section 10(23) could be made. The petitioner thereafter applied to the Secretary, Central Board of Direct Taxes, on July 29, 1970, for exemption under Section 10(23) praying that the Government of India may notify in the Official Gazette that the petitioner-trust was exempt from income-tax under the said section in the assessment year commencing from April 1, 1961, and subsequent assessment years. Though in the application the petitioner has sought the orders of the Government of India under Section 10(23) of the Act, the Central Board of Direct Taxes has itself considered the said application on merits, and rejected the same holding that the petitioner is not entitled to exemption under Section 10(23) as it has been established to encourage and promote sports activities of all kinds without confining its activities to any one specified sport activity. The petitioner has questioned the correctness of the said order passed by the Central Board of Direct Taxes and seeks a writ of mandamus directing the Central Board of Direct Taxes, the 2nd respondent herein, to grant the required exemption under Section 10(23) of the Act.