INCOME TAX ACT, 1961

Section 11

Charitable trust - Exemption under section 11 - Generation of incidental surpluses from leasing out the land to industrialists -

Revenue challenged order of Tribunal allowing benefit of exemptions under sections 11 and 12 to assessee. Revenue alleged that Tribunal failed to consider the fact that assessee was involved in widespread commercial activities in nature of business and activity of assessee was covered under provisions of section 2(15). Held: All questions proposed were squarely covered by decision rendered in case of Ahmedabad Urban Development Authority v. Asstt. Commissioner (Exemptions). It was held that that merely because while carying out activities for charitable object of industrial development, certain incidental surpluses got generated from leasing out the land to industrialists, the same would not render the charitable activity in the nature of trade, commerce or business for consideration, so as to attract proviso to section 2(15).

Followed:CIT (Exemptions) v. Gandhinagar Urban Development Authority [R/Tax Appeal No. 79 of 2020, dt. 25-2-2020] CIT v. Gujarat Industrial Development Corporation (2017) 83 Taxmann.com 366 (Guj) : 2017 TaxPub(DT) 1934 (Guj-HC) Ahmedabad Urban Development Authority v. Asstt. Commissioner (Exemption) (2017) 396 ITR 323 (Guj) : 2017 TaxPub(DT) 1863 (Guj-HC) Gandhinagar Urban Development Authority v. DCIT [ITA No. 3621/Ahd/2015, dt. 23-7-2019]

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2013-14

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