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2013 (11) TMI 1578 - HC - Income TaxWithdrawal of status of Charitable Institution given to the appellant-assessee under Section 12AA(1)(b)(i) - Held that - The Tribunal has reached a categorical conclusion that the assessee-Jammu Development Authority cannot be regarded as an institution or trust which may have been set up to achieve the objects enumerated under Section 2 of the Act particularly in view of the addition of first and second proviso made by the Finance Act, 2008 w.e.f. 01.04.2009 to Section 12 AA of the Act. There are findings of fact that the assessee-appellant has not been acting to advance any of the object concerning general public utility. Even otherwise the proviso which has been added by the Finance Act, 2008 w.e.f. 01.04.2009 stipulates that the advancement of any other object of the general public utility shall not be a charitable purpose, if it involves carrying on of any activity in the nature of trade, commerce or business or any activity of rendering any service in relation to any trade, commerce or business or a cess or fee or any other consideration.
Issues:
Appeal against withdrawal of charitable institution status under Section 12AA(1)(b)(i) of the Income Tax Act, 1961. Analysis: 1. The High Court was presented with an appeal challenging the order of the Income Tax Appellate Tribunal that withdrew the charitable institution status granted to the appellant under Section 12AA(1)(b)(i) of the Income Tax Act, 1961. The Tribunal concluded that the appellant, Jammu Development Authority, did not qualify as an institution or trust set up to achieve the specified objectives under Section 2 of the Act. This decision was influenced by the amendments introduced by the Finance Act, 2008, which stated that activities related to trade, commerce, business, or services in connection with these activities would not be considered charitable purposes. The court noted that the appellant had not been furthering any objectives related to general public utility, leading to the dismissal of the appeal. 2. Upon review, the High Court determined that no legal question, let alone a substantial one, arose from the Tribunal's decision that would necessitate the admission of the appeal. The court emphasized that the appeal lacked merit and was therefore deemed fit for dismissal. 3. Consequently, based on the aforementioned reasons, the High Court ruled that the appeal was without merit and dismissed it, along with any related applications.
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