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TMI Blog2012 (4) TMI 452X X X X Extracts X X X X X X X X Extracts X X X X ..... 010. 14.05.2010 M/s.Agriculture Produce Market Committee, Paonta Sahib, District Sirmaur, 2004-2005, 2005-2006 and 2006-2007 ITA Nos.364,365 & 366 of 2010. 03.05.2010 M/s.Agriculture Produce Market Committee, Paonta Sahib, District Sirmaur, 2007-2008 and 2008-2009 ITA Nos.386 and 387 of 2007. 14.05.2010 M/s.Agriculture Produce Market Committee, Una, District Una. 2003-2004 to 2008-2009 ITA Nos.971 to 976 of 2010. 31.08.2010 M/s.Agriculture Produce Market Committee, Una, District Una. 2003-2004 to 2008-2009 ITA Nos.971 to 976 of 2010. 31.08.2010 M/s.Agriculture Produce Market Committee, Hamirpur, District Hamirpur. 2003-2004 to 2008-2009 ITA Nos.948 to 953 of 2010. 28.07.2010 M/s.Agriculture Produce Market Committee, Hamirpur, District Hamirpur. 2003-2004 to 2008-2009 ITA Nos.948 to 953 of 2010. 28.07.2010 M/s.Agriculture Produce Market Committee, Hamirpur, District Hamirpur. 2003-2004 to 2008-2009 ITA Nos.948 to 953 of 2010. 28.07.2010 2. The appeals involve a common question of law that is as to whether the assessee is entitled to the exemption under Section 10(20) of the Income Tax Act, 1961 (hereinafter referred to as the `Act'). 3. The facts need n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Court. In Agricultural Produce Market Committee vs. Commissioner of Income-Tax and Another, (2007)294 ITR 549 (Delhi), this question engaged the attention of the High Court of Delhi which, after consideration of the case law on the point and the effect of the explanation added to Section 10(20) of the Act, held:- "9. The appellant-committee is no doubt a statutory committee established under the provisions of a legislative enactment. It has been given a distinct nomenclature with definite statutory functions and powers. There is, therefore, no question of treating the appellant-committee as a municipal committee for it is neither known as a municipal committee under the enactment under which it is created nor recognized by fiction of law as such by the Income-tax Act or by any other enactment for that matter. That being so, the court cannot by a process of interpretation include an entity like the appellant into the provisions of the Explanation by drawing a comparison between the nature and functions which a municipal committee is expected to discharge with those discharged by the appellant. Any such process would imply that the court interprets the provision by reference to wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove. However, it may be noted that this court in the case of R.C. Jain, was required to consider the question as to whether "Delhi Development Authority" is a "local authority" as its employees stood outside the purview of the Payment of Bonus Act, 1965. Under Section 32(iv) of the Payment of Bonus Act, 1965 it is stated that nothing in the said 1965 Act shall apply to the employees employed by an establishment engaged in any industry carried on by or under the authority of any Department of the Central Government or State Government or a local authority. It is in this context that the court was required to consider in the case of R.C. Jain, as to whether the DDA is a "local authority". There was no definition of "local authority' in the said 1965 Act. Therefore, this court had to go back to section 3(31) of the 1897 Act. As quoted hereinabove, section 3(31) of the 1897 Act defines "local authority" to meana Municipal Committee, District Board, body of Port Commissioners or other authority. In the case of R.C. Jain, this Court was aware that the DDA is neither a District Board nor a body of Port Commissioners. Therefore, the only question the court had to address to was: whether DD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of India. However, there is no reference to article 243 after the words "Municipal Committee" and "District Board". In our view, the Municipal Committee and District Board in the said Explanation are used out of abundant caution. In 1897 when the General Clauses Act was enacted there existed in India Municipal Committees and District Boards. They continued even thereafter. In some remote place it is possible that there exists a Municipal Committee or a District Board. Therefore, in our view, apart from a Panchayat and Municipality, Parliament in its wisdom decided to give exemption to Municipal Committee and District Board. Earlier there were District Board Acts in various States. Most of the States had repealed those Acts. However, it is quite possible that in some remote place a District Board may still exist. Therefore, Parliament decided to give exemption to such Municipal Committees and District Boards. Therefore, in our view, advisedly Parliament has retained the exemption for Municipal Committee and District Board apart from Panchayat and Municipality. Our view finds support from the provisions contained in Part IX of the Constitution of India. Article 243N provides for cont ..... X X X X Extracts X X X X X X X X Extracts X X X X
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