Tax Authorities To Inquire BCCI Regarding Subsidy: SUPREME COURT


Tax Authorities To Inquire BCCI
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Tax Authorities To Inquire BCCI

The Supreme Court ruled that the tax authorities. Must also look into the type of rights that the BCCI granted to successful bidders. Here in this article, we have discussed Tax Authorities To Inquire BCCI in detail.

The content of the broadcast rights, and the agreement with regard to state associations.

On Wednesday, the Supreme court quoted advancing a general public utility. It cannot engage in any trade commerce, or business, or provide services in relation. Tax Authorities are observing it in each case.

All are under an obligation to carefully examine and see the pattern of receipts and expenditures. All the amounts made over by the BCCI to the cricket associations as Infrastructure subsidies.

Supreme court said additional factors must be considered. Including the type of rights granted by the BCCI to the successful bidders. 

“In the course of achieving the object of general public utility (GPU), the concerned trust, society, or other such organization. It can carry on trade, commerce, or business or provide services in relation there for consideration. Also, provided that I the activities of trade, commerce, or business are connected”.

The bench took note of the argument that cricket is a sport that promotes education. And that even if it were not, it would still be useful to the general populace. The BCCI, principal governing organization, promotes sport both domestically and internationally. And the  state cricket associations listed above are its second- and third-tier associations.

The court is of the opinion that the ITAT(Income Tax Appellate Tribunal).

As well as the High Court errored in accepting at face value the contention. The sums paid over by the BCCI to the cricket organizations were in the type of infrastructure subsidy. Justice Bhat, who wrote the judgment on behalf of the bench. The tax authorities required to carefully study. Also, determine the pattern of receipts and expenditures in each case and year.

The nature of the rights granted by the BCCI to the successful bidders, or the content of the broadcast rights. As well as the arrangement with regard to state associations (whether in the form of master documents, resolutions. Or it can be individual agreements with state associations.

The bench ruled that there doesn’t necessarily need to be a direct correlation.

Proportional division between the receipt and the actual spending. This is in keeping with the idea to leave it up to the parties. To decide what constitutes a sufficient consideration for an agreement.

According to the state cricket associations of Saurashtra, Gujarat. Rajasthan, Baroda, and Rajkot. 

Therefore, The AO (Assessing Officer) decides the case again. After notifying the involved assesses and reviewing the pertinent evidence. Furthermore, the highest court stated in its 149-page ruling. That any consequential orders that must be given must be done so. And any further actions, including assessment orders. Must be made in compliance with the law and pertinent provisions of the IT Act.

The highest court stated that the conclusions reached by this ruling do not bar any assesses (whether statutory or non-statutory) furthering purposes of general public utility from claiming exemption in the future if the relevant year’s receipts exceed the quantitative limit.

Court ruled that even if the relevant year’s receipts exceed the quantitative limit.

Afterall, the conclusions reached by this decision do not prevent any assesses (statutory or non-statutory).  If promoting general public utility purposes from claiming exemption in the future.

The decisions of various high courts. Held that the operation of any trade, commerce, or business is not as per se bar. Or disqualification for a GPU (General Public Utility) category charitable trust to claim to be such.

Precluding its tax-exempt status under the IT Act. Appealed by the Director General of Income Tax for Exemptions. Commissioner of Income Tax in various states, and other officials of the Income Tax Department.

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