2024 (1) TMI 1239 - SCH - Income Tax

Exemption u/s 11 - Charitable activity u/s 2(15) - assessee receives fee by way of commission from the Government for purpose of construction of building for Government - as per HC 2021 (12) TMI 602 - KERALA HIGH COURT reason being the construction activity by itself does not advance any other object of general public utility. General public utility from such construction is derived as fact with the facilities constructed by the assessee are put to utility. Activity undertaken by the assessee on one hand and on another hand with the ultimate purpose or user of buildings constructed by the Government shall not be mistaken with one another. Assessee is interpreting proviso by excluding one of the important limbs, viz. involves the carrying on of any activity in the nature of trade, commerce or business, thus substantial question decided against the assessee HELD THAT - All the parties are in agreement about the issue being covered by the judgment of this Court in Assistant Commissioner Of Income Tax (Exemptions) vs. Ahmedabad Urban Development Authority 2022 (10) TMI 948 - SUPREME COURT In terms of the judgment of this Court, the matter should be remanded to the Assessing Authority for determination of the commercial activity and for considering the benefit of Section 12A of the Income Tax Act and for passing appropriate orders. In view of the above Civil Appeal is disposed of.

Summary

The Supreme Court granted leave and remanded the matter to the Assessing Authority for determination of commercial activity and consideration of Section 12A of the Income Tax Act, as per the judgment in Assistant Commissioner Of Income Tax (Exemptions) vs. Ahmedabad Urban Development Authority; 2023 (4) SCC 561. Civil Appeal and pending application(s) were disposed of.