Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2023 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (7) TMI 77 - AT - Income TaxBenefit of exemption u/s 11 - Whether activities of the assessee to be falling under the limb of ‘Advancement of any other object of general public utility’ of Section 2(15) ? - HED THAT:- Hon’ble Supreme Court in the case of ACIT Vs. Ahmedabad Urban Development Authority [2022 (10) TMI 948 - SUPREME COURT] has clearly held that Parliament has proscribed involvement or engagement of GPU in any activities in the nature of trade, commerce or business or involve in providing services in relation to trade, business or commerce for fee, cess or other consideration. The limited relief granted by Parliament is that if such activities are carried out in the course of actual carrying on objects of GPU (general Public Utilities) then the quantum of receipts shall not exceed 20% of the total receipt. In the present case as observed that activities of Renting Hall, Leasing Property, Charging Fees for Certifications, Charging fees for Programs etc. is nothing but activity in the nature of Trade, Commerce, Business or providing services in relation to Trade, Commerce, Business by charging fee, cess. Basic fact in this case is that the quantum of receipt from such activities is more than 20% of the total receipt. For Example, the Leasing Income is Rs.2,23,17,651/- out of total income of Rs.10,60,58,855/- which is 21% of the total receipts. In addition to the leasing income there are other receipts like hall charges, programme fees etc. These receipts are in the nature of trade, business or commerce or providing services in relation to Trade, Commerce, Business for fee. Thus, the receipts from these activities which is in the nature of trade business, or commerce is definitely more than 20% of the total receipts, hence, as per proviso to section 2(15) of the Act, the activities are not for charitable purpose. Assessee is not eligible for exemption u/s 11 - Also observed that the net profit is 28%. The Reserve & Surplus is Rs.37,13,44,294/-. This also explains that the assessee’s main aim is to earn profit - Appeal of the Revenue is allowed.
|