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2013 (12) TMI 354 - AT - Income TaxRefusal of registration under section 12A The assessee, a trust, is established by the State Act called "Rajasthan Urban Improvement Act, 1959" by the State of Rajasthan and the predominant purpose of the assessee is the development of the urban areas in the State of Rajasthan - Held that:- The main objects of the assessee are to construct the roads, provide the water and electricity facility, to construct the drainage system, to improve the gardens and open space, to provide housing facility by allotting the residential plots, etc., which are in the nature of general public utility and even though the assessee might be carrying on with a profit motive but such activity was incidental to the objects of the assessee - Following CIT v. Improvement Trust [2008 (10) TMI 80 - PUNJAB AND HARYANA HIGH COURT] - If the predominant object of such activity is to carry out the charitable purposes of the trust or institution then such activity will not lose its character of a charitable purpose merely because some profit arises from the activity Following CIT v. Gujarat Maritime Board [2007 (12) TMI 7 - SUPREME COURT OF INDIA] - The expression 'any other object of general public utility' include all objects which promote the welfare of the general public - If the primary purpose and the predominant object are to promote the welfare of the general public the purpose would be a charitable purpose Decided in favour of assessee. Penalty u/s 271B The assessee was not granted registration u/s 12A and exemption u/s 11 - The assessee had shown gross receipts of Rs. 1,42,02,845 - Held that:- In view of the order of the Tribunal to grant the assessee registration u/s 12A Penalty cannot be imposed - Decided in favour of assessee.
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