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TMI Blog2022 (2) TMI 334X X X X Extracts X X X X X X X X Extracts X X X X ..... and for purposes incidental thereto. Provided that save as provided in this act nothing contained in this act shall be construed as authorizing the disregard by the authority of any law for, the time being in force. Thus, the above said act authorizes the assessee to undertake any activity to fulfill the main object of development of land in the specified area. In the instant case, the AO has not brought anything on record that distinguishes the clauses of the trust that were available before the authorities while granting registration u/s. 12AA of the Act. There has been no change in the objects of the assessee. Hence, we hold that invoking of provisions of Section 2(13) against the relevant provisions of Section 2(15) is not legally sustainable Hence, we hold that the decision of the ld. CIT(A) cannot be sustained. Having held that the assessee is eligible for deduction u/s. 11 of the Act, the matter is being remand back to the file of the ld. CIT(A) for the limited purpose of recomputing the eligible deduction in accordance with the provisions of Section 2(15).Having held that the assessee is eligible for deduction u/s. 11 of the Act, the matter is being remand back to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rming the action of Ld. AO in making the ₹ 36,79,49,958/- on account of balance portion of interest received on installments and that too by recording incorrect facts and findings and in violation of principles of natural justice. 8. That having regard to the facts and circumstances of the case, Ld. CIT(A) has err law and on facts in confirming the action of Ld. AO in seeking direction u/s. 144A and has further erred in not quashing the directions u/s. 144A. ITA No. 2156/Del/207: A.Y. 2003-04: (By the Revenue) Following grounds have been raised by the Revenue: 1. The Ld. Commissioner Income Tax(Appeal) has erred in law and on facts in concluding that the sum of ₹ 34,65,85,407/- and of ₹ 32,61,33,230/- (₹ 32.61 crore), totaling to ₹ 67,27,18,637/-, should have been charged to tax during the year under consideration. 2. The Ld. Commissioner of Income Tax(A) has erred in law on facts in allowing relief on account of closing stock of ₹ 679,00,36,886/- (₹ 746,27,55,523- ₹ 67,27,18,637). 3. The Ld. Commissioner of Income Tax(A) has erred in law and on facts in deleting the addition of ₹ 2,00,00,000/-, o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o which is yet to be given by the ld. CIT(Exemption), Lucknow. 2. The assessee is engaged in development work constituted under Uttar Pradesh Urban Planning and Development Act, 1973. The assessee had been claiming the benefits of provisions of section 10(20A). Section 10(20A) was omitted by Finance Act 2002. Thus, the A.Y. 2003-04 was the first year wherein return of income was filed by the assessee as prior to this year. The assessee was getting assessed u/s. 10(20A) which has been repealed with effect from 01.04.2003. The assessee filed return declaring Nil income on 31.10.2006. The case was selected for scrutiny. The assessee has shown an excess of income over expenditure of ₹ 4,61,95,89,445/- and claimed exemption u/s. 11 alongwith Form 10 for exercising the option for accumulation of income u/s. 11(2). 3. On 31.12.2008, the Assessing Officer invoked provisions of section 142(2A) to get the accounts of the assessee audited by the special auditor. The assessee has challenged the validity of appointment of special auditor before Hon'ble Allahabad High Court in Writ Tax No. 391/2009. The Hon'ble High Court stayed the special auditor's appointment vide stay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 2(15) of the Act in the year under consideration. 7. Aggrieved, the assessee filed appeal before the Ld. CIT(A) against the additions. The ld. CIT(A) supported the order of the AO holding that GDA is an authority constituted by state for looking after the development work in particular area of state is not subject to income tax laws as the object of creation of the authority is not to earn profit or income. The Ld. CIT(A) held that plain reading of Section 2(13) defining the term 'business' reveals that business includes any trade commerce or manufacture or any adventure or concern in the nature of trade, commerce or manufacture. 8. The Ld. CIT(A) held that the assessee is engaged in development of land and in accordance to the Uttar Pradesh Urban Development Act 1973. As per Section 7 of the Act, the object of authority is to promote and secure the development of the area according to the plan and for that purpose authority shall have power to acquire, hold, manage and dispose of land and other property to carry out building, engineering, mining and other operations to execute the works in connection with the supply of water and electricity dispose of sewage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of monuments and any other objects of public utility . 12. This object of public utility as per Section 2(15) in the case of the assessee has been examined in detail by the Tribunal and further by Hon'ble Jurisdictional High Court and the registration u/s. 12AA has been duly granted. The object of the assessee carrying the development of townships has been treated as charitable purpose for the purpose of the Income Tax Act. In the present case, the revenue authorities denied the benefit of exemption applying provisions of Section 2(13) instead of provisions of Section 2(15). In the light of the order of the Co-ordinate Bench of Tribunal and it being upheld by the Hon'ble High Court, the basis of denial of benefit u/s. 11 of the Act, as adopted by the Assessing Officer and affirmed by the Ld. CIT(A) stands vitiated and non-existent. In the instant case, the AO has not brought anything on record that distinguishes the clauses of the trust that were available before the authorities while granting registration u/s. 12AA of the Act. There has been no change in the objects of the assessee. Hence, we hold that invoking of provisions of Section 2(13) against the relevant pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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