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TMI Blog2013 (12) TMI 992X X X X Extracts X X X X X X X X Extracts X X X X ..... n of Section 11,12, 12A, I2AA and 13 of the I. T. Act". 2. "Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) was right in ignoring the ratio of Hon'ble Supreme Court judgments in the case of Escorts Ltd vs. Union of India (199 ITR 43) wherein Hon'ble Supreme Court has held that double deduction cannot be presumed if the same is not specifically provided by law, in addition to normal deduction". 3. "The Appellant prays that the order of the Id. CIT (Appeals)-l, Mumbai be set aside and that of the Assessing Officer be restored." 2. The assessee in the present case is primarily known as MIDC crated by Government of Maharashtra by Maharashtra Industrial Development Act, 1961 which earlie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d as a Local Authority within the meaning of term "person" for the purpose of Income-tax Act, 1961 and with effect from its inception to 2002. The MIDC continues to be Local Authority in eyes of law. It can not be considered as a Public Trust or Charitable Trust or Trust of any other kind. (3) On a proper interpretation of the intention behind the enactment of the provisions of sections 11, 12, 12A, 12AA and 13 of the I.T. Act, 1961, it appears that the tax incentive proposed in the scheme of exemption from charge of income tax is more applicable to the cases of private individual and groups and association who create valid Public Trust and dedicate its income for the purpose of general public welfare. The scheme of section 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relates to deficit claimed by the assessee to the tune of Rs.20,93,67,718/-, which was requested to carry forward. The same is denied by the AO on the ground that such claim is made on the assets cost of which has already been claimed as application towards object of trust in earlier year for the purpose of availing exemption under the Act and thus allowing the same will result into double deduction to the assessee and in this manner the income of the assessee has been determined at Rs. 128,14,38,536/-. 5. The action of the AO was contested in an appeal filed before Ld. CIT(A), who has decided the appeal vide impugned order dated 26/7/2011. Ld. CIT(A) has held that MIDC has already been granted a registration under section 12A of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Corporation to hold and apply all its property income and assets for the purpose of the Act i.e. object of general public utility. Therefore, the assessee is eligible for claiming exemption under section 11 and AO has been directed to allow exemption to the assessee under section 11. Ld. CIT(A) has also placed reliance on the decision of Hon'ble Supreme Court in the case of CIT vs. Andhra Pradesh State Transport Corporation, 159 ITR 1, wherein it has been held that a State Road Transport Corporation is one for charitable purpose and is entitled to exemption under section 4(3)(1) of 1922 Act as also section 11 of 1961 Act notwithstanding that it runs on business purpose. 6. On second issue Ld. CIT(A) has held that carry forward of deficit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ard deficit then it will tantamount to allowance of double deduction as the income out of which expenditure have been made has already considered as application of income. 9. On the other hand, Ld. AR relied upon the decisions on which Ld. CIT(A) has granted the relief to the assessee. He submitted that so far as it relates to Ground No.1, the grievance of the revenue is only that assessee is not lawful trust within the meaning of section 11,12,12A & 12AA and13 of the Act. He submitted that this ground is contrary to the decision of Hon'ble Supreme Court in the case of CIT vs. Gujarat Maritime Board(supra). So as it relates to second issue he submitted that the issue is directly covered by the decision of Hon'ble Bombay High Court in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) the source of income must be held under trust or under other legal obligation. Applying the said test it is clear that Gujarat Maritime Board is under the legal obligation to apply the income which arises directly and substantially from the business held under the Trust for the development of minor ports in the State of Gujarat. Therefore, they are entitled to be registered as charitable trust under section 12A. In the present case it has been noted by the AO that assessee's function also does not involve any profit motive. Therefore, we find that the ratio laid down in the case of CIT vs. Gujarat Maritime Board (supra) is clearly applicable to the case of the assessee. Therefore, we hold that there is no infirmity in the order of Ld. CI ..... X X X X Extracts X X X X X X X X Extracts X X X X
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