TMI Blog2012 (11) TMI 656X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee - I.T.A. No.175/Ahd/2011 - - - Dated:- 13-1-2012 - Shri Mukul Kr. Shrawat And Shri A. K. Garodia , JJ. Appellant by : Shri S. N. Soparkar with Shri M. G. Patel Respondent by : Shri S. K. Gupta, CIT-DR ORDER Per Shri Mukul Kr. Shrawat, Judicial Member : This is an appeal at the behest of the Assessee which has emanated from the order of the CIT-Gandhinagar passed u/s.12AA (3) of I.T. Act dated 10/12/2010. 2. From the side of the appellant, several grounds have been raised, however it was pointed out at the outset that the main issues are covered vide following grounds:- 1. The Learned Commissioner of Income Tax, Gandhinagar has erred in law as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e as selected by the State Government. The location so developed are available to Industrial Undertakings to establish a business enterprise. To enforce the object the assessee has developed lands and allotted for Industrial Use on Lease as well as Transferred after charging consideration. As per ld.Commissioner, various resources of income of the assessee were several in number as listed below:- (i) Income from sale of tender forms (ii) Recovery of Fines from Contractors and others (iii) Annual Rent of Land Leased by the Corporation (iv) Securities Fees of applications (v) Services charges for maintenance of different infrastructure facilities such as Roads, Street lights, and other amenities in its various estates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es deposits from various parties like (i) Contractor (ii) ECP Project (iii) Industrialists towards price of plots (iv) Industrialists towards price of sheds and land for sheds (v) Price of quarters for workers and housing plots, rural workshop, applicants for godowns and sundry deposits. 4. Ld.Commissioner has therefore made an observation that on perusal of the description of receipts and expenditure it was found that the assessee happened to be running its activities in a professional and business like manner. In his opinion, the assessee had derived profit out of such business like activities. In his opinion, there was no free services to the public. According to him, there was no charity meant for public which could qualify within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no longer charitable, the same can be withdrawn. In such a situation when the objects are defeated, then the provisions of section 12AA(3) empowers the Commissioner to cancel such registration. Ld.Commissioner s second observation was that in view of the amendment made u/s.2(15) of I.T.Act wherein definition of charitable purpose has been amended, the assessee had lost its character as charitable institution and seizes to get the benefit. With these observations, ld.Commissioner has held that he was not satisfied that the GIDC happened to be a charitable organization and the objects have lost the character of charity therefore registration was cancelled, and held that not eligible for the benefits prescribed under sections 11 and 12 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... funds have been utilized for profit motive or for non charitable purpose and there is no basis found in this regard in the order of DIT (Exemption). The assessee has also invited our attention to the P L account up to the year ended 31.03.2008 in which the assessee has used 85% of the funds collected. There is nothing on record that the assessee has violated any conditions laid down u/s 12AA(3) of the Act. Reliance was placed on the decision of ITAT Ahmedabad A Bench in I.T.A.No. 754/Ahd/2010 dated 21.05.2010 and the decision of ITAT A Bench Chennai in I.T.A.No. 987/Md/2010 dated 19.09.2011 which are directly on the issue in hand. Thus, following these Tribunal orders of Ahmedabad Bench and Chennai Bench mentioned hereinabove and in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the assessee is entitled to registration or not because the assesseeinstitution is already registered vide order of the DIT (Exemption) under Section 12AA (1) dated 23-10-2003. The limited issue in this appeal before us whether the DIT (Exemption) was justified in canceling such registration by invoking the power under Section 12AA(3). 9. Having heard the submissions of both the sides, the provisions of section 12AA(3) prescribes that once a trust or an institution has been granted registration u/s.12AA(3) and subsequently if the Commissioner finds that one of the condition, viz. the activity of the trust is not genuine or that the activity of trust not been carried out, then the Commissioner has power to cancel the registration gr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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