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TMI Blog2012 (4) TMI 614X X X X Extracts X X X X X X X X Extracts X X X X ..... dered as business activity, ignoring that the assessee has not utilized these expenditure for road construction whereas these payments has been received for road construction which is a part of income and expenditure account. 2. That the ld. CIT(A) erred in law and on facts in holding that mere generation of surplus will not amount to generation of profit so long as surplus is not distributed and it rather ploughed back for the purpose of some designated activities, ignoring that the assessee is having specific project of road construction and also ignoring that income of the assessee is not exempt u/s 11. 3. That the ld. CIT(A) erred in law and on facts in observing that Anshdan and Fund for Nirman Yogna were given to the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... auli for the AY 2002-03 , the assessee submitted that grants provided by the State Government and contributions made by the sugar factories could not be treated as income of the assessee and thus, could not be taxed ,particularly when the assessee is a local authority covered under clause iii of explanation to section 10(20) of the Act. The assessee further pointed out that Cane Commissioner of UP State exercised administrative control over the committee. However, the AO did not accept the submissions of the assessee in view of the amended provisions of section 10(20) of the Act w.e.f. 1.4.2003 and the assessee being not registered u/s 12A of the Act. The AO further noticed that the assessee did not reflect receipt of Rs. 93,17,000/- under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y business activity. 5.2 However, more importantly, the issue is clinched in favour of the appellant, when it is realized that there is, in any case, no surplus generated during the year. I have perused copies of income and expenditure account and find that the appellant submitted two such accounts before the Assessing Officer, both are part of the audited report. First is 'Income and Expenditure Account" which is an account in respect of appellant's regular activities. The second is "Receipt & Payments", which is by its nomenclature, summation of all receipts and of payments. The Assessing Officer noticed that the amount of Rs. 93,17,000/- being District Prime subsidy, Rs. 69,00,420/- being road construction subsidy are incorporated on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is now in appeal before us against the aforesaid findings of the ld. CIT(A).The ld. DR merely supported the order of the AO. 6. We have heard the ld. DR and gone through the facts of the case. Indisputably, the Ansh Dan and fund for Nirman Yojna, were given to the assessee by the State Government & Sugar factories for specific projects of road construction and as pointed out by the ld.CIT(A), these funds have been spent also for those specific projects. There is nothing to suggest that the assessee is carrying on any business activities, generating income. Accordingly, the ld. CIT(A) concluded that there was no surplus with the assessee and therefore, there was no question of any taxable income. Admittedly, the grant-in-aid in quest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. CIT(A) concluded that the aforesaid funds received by the assessee from State Government and sugar factories have been spent only for those specific projects and there was no surplus with the assessee. Since the Revenue have not placed before us any material, controverting these findings of facts recorded by the ld. CIT(A) so as to enable us to take a different view in the matter, there is no basis to interfere with his findings .Consequently, ground nos.1 to 3 in the appeal are dismissed.
7. Ground no.4 in the appeal, being general in nature, does not require any separate adjudication and is ,therefore, dismissed.
8. No other plea or argument was made before us.
9. In the result, appeal is dismissed. X X X X Extracts X X X X X X X X Extracts X X X X
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