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TMI Blog2001 (10) TMI 46X X X X Extracts X X X X X X X X Extracts X X X X ..... in the circumstances of the case, the Tribunal was right in entertaining the additional grounds of appeal? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee-Corporation is constituted for carrying out the activities as laid down in section 10(20A) of the Income-tax Act, 1961? 3. Whether, on the facts and in the circumstances of the case, the Tribunal was right in not reversing the Commissioner of Income-tax (Appeals) finding that the income from the assessee's income from business?" The respondent is the Rajasthan Land Development Corporation which is constituted under the Rajasthan Land Development Corporation Act, 1975. The respondent-assessee claimed exemption of its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The application under section 256(1) of the Revenue for making reference of the aforesaid questions to this court was rejected by the Tribunal vide its order dated August 26, 1988, by holding that since it has been held by the Rajasthan High Court in Chand Behari Lai v. State of Rajasthan in SBCWP No. 6 of 1980 decided on March 14, 1980, that the Rajasthan Land Development Corporation is a Corporation established by a statute to improve the land for facilitating better cultivation with proper irrigation facilities, roads, water channels, levelling of the area and making the fields regular, where they are irregular areas and by referring to the preamble of the Act of 1975 held that the respondent is a Corporation which falls within the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en permitted to be raised and it is a matter of discretion of the Appellate Tribunal in appropriate cases to allow any party to the appeal to raise a new contention before it. Such power is clearly stipulated under rule 11 of the Income-tax (Appellate Tribunal) Rules, 1963. Thus, in every case, it is a matter of exercise of discretion whether to permit a party to raise a new ground or not. To exercise such discretion in a given case, in our opinion does not give rise ordinarily to a question of law unless, the same is challenged on the ground that the discretion exercised by the Tribunal was grossly injudicious. So far as the question about the power of the Tribunal to permit new grounds of appeal is concerned, the answer is obvious and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ond requirement is that such an authority must have been constituted for the purpose of dealing with and satisfying the need of housing accommodation, like the housing board or for the purpose of planning, development and improvement of cities, towns and villages or for both. This obviously refers to the preamble regarding the purpose for which the enactment has been made and also the relevant definition and the functions which are assigned to such duly constituted authority. In that light, the Tribunal has referred to the preamble of the Act of 1975 which reads as under: "An Act to constitute a corporation for the execution of projects relating to land development with a view to preventing damage to land and loss in agricultural producti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... towns and villages as used in section 10(20A) of the Act. The Gujarat High Court in Gujarat Industrial Development Corporation v. CIT [1985] 151 ITR 255, has taken a view interpreting section 10(20A) that development of an industrial area does not fall within the ambit of section 10(20A) because the same is not for the development of cities, towns or villages and that is for a different purpose. Examining the judgment of the Gujarat High Court, the Supreme Court said in Gujarat Industrial Development Corporation v. CIT [1997] 227 ITR 414, that the word "development" in section 10(20A) of the Income-tax Act should be understood in its wide sense. There is no warrant to exclude all development programmes relating to any industry from the purv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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