TMI Blog2020 (6) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... nt, as set out in the memorandum of appeal, are as follows:- 1. On the facts and in the circumstance of the case, the AO and the CIT(A) has erred in law in passing and approving this order u/s 143(3) r.w.s. 147 of the Income Tax Act for A.Y 2011-12. 2. The Learned Commissioner of Income-tax (Appeals) has erred in upholding that the notice issued under section 148 is valid. 3. On the facts and in the circumstance of the case, The Learned Commissioner of Income-tax (Appeals) has erred in holding that the appellant is not a state under Article 289 of the Constitution of India and therefore, liable to tax under the Income Tax Act. 4. On the facts and in the circumstance of the case, The Learned Commissioner of Income-tax (Appeals) and the Assessing Officer has erred in holding that the appellant herein is a person for the purposes of Income-tax Act and therefore, it is liable to file the return of income. 5. On the facts and in the circumstance of the case, AO and The Learned Commissioner of Income-tax (Appeals) has erred in upholding the assessment of surplus under the head income from business and profession of the appellant herein when in fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... below the rank of Joint Director; (iii) One representative of the State Nodal Centre of National Technical Manpower information System; (iv) The Regional Officer (Western Region) of All India Council of Technical Education, New Delhi; (v) The Director, Board of Apprenticeship Training (Western Region), Government of India, Ministry of Human Resources Development,(vi) The Joint Secretary to Government, Higher and Technical Education Department or his nominee not below the rank of Deputy Secretary. Nominated Members (i) one senior most Principal from Government Engineering Colleges in the State to be nominated by the Government. (ii) Two members to be nominated by the Government from amongst the Principals and Heads of institutes, one each from Government or aided and un-aided Polytechnics, of which at least one shall be a woman, (iii) Two members to be nominated by the Government from amongst the teachers, one each from Government or aided and un-aided polytechnics, of whom at least one shall be from Backward Class Community,(iv) Three members to be nominated by the Government from the professional bodies, one from each revenue region by rotation. (v) Six members to be nominated by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch Resolution, order or Act, is a nexus of the power conferred by or under the Act upon the Board. In our view, as per section 24 of the State Act, the State Government have full control over the Board in its day to day affair in Regulation or business of the assessee's Board. 30. Sections 25 to 35 of the Act deals with the permission, affiliation, conference and autonomous status of the assessee. Further, sections 36 to 44 of the Act are prescribed about funds, finance, accounts and audit. The assessee's Board is under obligation to furnish the report and return and statement relating to any matter connected with its work as the Government may call for. Sections 45 to 53 deals with supplementary and miscellaneous provisions of the State Act with regard to manner of exercise of power delegated to Committee, power of Board to make Regulation with regard to examination, condition governing admission, passing marks in any subject and examination as hold including credit and distinction in any subject, fees for admission to the examination, other fees, charges payable in respect of other matters to the examination. Arrangement of conduct of examination, appointment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erintendence, instruction and control of the State Government. In our view, the assessee Board is completely controlled financially as well as administratively by the Government, thus, falls under the definition of State as per Article 12 of the Constitution of India. 31. The co-ordinate bench of Tribunal in Smt. Sapna Sanjay Roisoni (supra) while considering the scope of Article 12 of the Constitution of India gave the following finding; 11. The definition of the State under Article 12 has come for the consideration on number of occasions before the Hon'ble Supreme Court. The State consists of three departments, the Legislature, the Executive and the Judiciary. We need not go into all the limbs of the State as only the limited issue before us is whether the term Government used in clause (b) to Rule 6DD includes even the autonomous bodies which partakes the character of instrumentalities of the Government. The core test to be applied whether a particular Corporation which is autonomous body is a part of Government, to be seen in the context of degree of control over management and policy decisions. We find that in the case of MSRTC as per the certificate of the sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... States; (c) all local and other authorities within the territory of India; and (d) all local and other authorities under the control of the Government of India. 11. The expression other authorities used in Article 12 is neither defined in the Constitution of India nor in any other statute. Therefore, the Hon'ble Supreme Court of India and the Hon'ble High Court have interpreted this expression in various judgements. The Hon'ble Supreme Court of India while interpreting the expression other authorities in the case of Som Prakash Rekhi v. Union of India reported as AIR 1981 SC 212 have culled out certain tests to determine as to when a Corporation should be said to be an instrumentality or Agency of the Government. The tests laid down by the Hon'ble Apex Court are summarized as under : 1. If the entire share capital of the corporation is held by the Government, it would go a long way towards indicating that the corporation is an instrumentality or agency of the Government. 2. Existence of deep and pervasive State control may afford an indication that the corporation is a State agency or instrumentality. 3. Whether the Corporation enj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Act. 32. Similar view was taken by Kolkata Tribunal in Narayan Rice Mill (supra). 33. We have further noted that the assessee Board made an application under clause (46) of section 10 for exemption of specified income to the assessee and CBDT vide its notification dated 29.03.2016 exempted the income of assessee Board arising from: (a) fees, fines and penalties; (b) receipts from Printed Educational Material; (c) receipts from Scrap or Waste paper; (d) receipts from other Government Bodies; (e) interest income from surplus funds kept in bank accounts and fixed deposits; (f) rent received from let out of properties'; (g) royalty or License fees for providing technical knowledge and infrastructure; (h) dividend earned from Maharashtra Knowledge Corporation Ltd; (i) capital gains, if any, from disposal of assets as per Government financial guideline and rules of Government of Maharashtra. 34. The exemption in the CBDT notification dated 29.03.2016 is valid for Financial Year 2015-16 to 2018-19. Admittedly no return of income was filed by the assessee for the assessment year under consideration. The ld. AR initial ..... X X X X Extracts X X X X X X X X Extracts X X X X
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