TaxTMI 
TaxTMI 
2009 (11) TMI 79
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....teps for the prevention and control of disease and pests and to render all possible help in the soil extension work; (e) to impart technical training to cultivators in matters relating to the production of cane; (f) to administer the funds at its disposal for the execution of the development scheme subject to the general or special direction of the Cane Commr.; and (g) to perform other prescribed functions pertaining and conducive to the general development of the zone. The area for which a development council is established is called "zone". The assessee was originally granted registration under s. 12AA of the Act by order dt.15th Nov., 2007. The learned C1T in the impugned order thereafter noted that a proviso to s. 2(15) defining the phrase "charitable purposes" was added by the Finance Act, 2008 w.e.f.1st April, 2009. As per substituted definition "charitable purposes" is defined as under: "(15) 'charitable purpose' includes relief of the poor, education, medical relief and the advancement of any other object of general public utility: Provided that the advancement of any other object of general public utility shall not be a charitable purpose, if it involves the carrying....
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....een levy of contribution and receiving the contribution itself at the instance of State Government Act. The learned counsel further submitted that the contribution received by the assessee is to be used as per orders of the Sugar Commr., Uttar Pradesh, Lucknow and it has no concern with the administrative expenses or with the providing services to the catchments areas of the contributing entities. The assessee can provide services within its zone and not outside its zone. The assessee has received contributions from the following sugar mills: 1. Sambhaoli Sugar Mills vs. Sambhaoli, D-Ghaziabad. 2. Nanglamal Sugar Mills vs. Nanglamal, T&D-Meerut. 3. Daurala Sugar Mills vs. Daurala, T-Sardhana, D-Meerut. 4. Mawana Sugar Mills vs. Mawana, T-Mawana, D-Meerut. Above three sugar mills at serial Nos. 1 to 3 are not in the zone of the appellant and are outside its zone and sugar mill at serial No. 4 is in the area of the appellant and hence the contention of the CIT that the contribution levied by the council is being utilized for providing services to the catchment areas of the contributing entities. The appellant can spent any money in its zone although contributions may be received....
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....e assessee are "advancement of any other object of general public utility" and for such objects the assessee which was originally granted registration under s. 12AA, cannot be withdrawn as the objects of the assessee do not involve carrying on of any activity in the nature of trading, commerce or business or any activity of rendering any service for a cess or fee. 4. The learned Departmental Representative Smt. Roli Aggarwal on the other hand, relied upon the impugned order as summarized above. 5. We have considered the relevant facts and arguments advanced. The assessee council which is constituted under s. 5 of Uttar Pradesh Sugar Cane (Regulation of Supply & Purchase) Act, 1953, was to carry out functions as enumerated above. These functions were held to be "charitable purposes" within the meaning of s. 2(15) of the Act while granting registration under s. 12AA by an order dl.15th Nov., 2007. The function of the assessee remains the same. Therefore, primarily it can be held that the functions performed by the assessee are charitable purposes in the nature of "advancement of any other object of general public utility". The dispute arose in view of the insertion of proviso to s.....
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....fee for rendering services. Thus, it is incorrect to hold that the assessee is carrying on any commercial activities or that it renders any service in relation to trade, commerce or business for a cess or fees. The assessee receives grants and contribution which may include cess levied by the UP Government under Uttar Pradesh Sugar Cane (Regulation of Supply & Purchase) Act but such amount is not levied under any authority available to the council itself. We, therefore, hold that the registration granted to the assessee could not have been withdrawn. 6. It is also to be noted that apart from the services if any to the sugar mills, the assessee also performed various other functions like development of the zone, execution of development plan in all its essential like cane varieties, cane seeds, sowing programme, fertilizers and manures, development of irrigation and agricultural facilities, imparting technical training to cultivators etc. In respect of these functions, the assessee does not render services for a cess or fee. Therefore, these functions will still remain "charitable purposes" as defined in s. 2(15) of the Act. Under s. 11(1)(a) of the Act, income portion from propert....