TaxTMI 
TaxTMI 
2014 (4) TMI 525
X X X X Extracts X X X X
X X X X Extracts X X X X
.... is found eligible during the course of appellate proceedings and the appellant can crave, add or leave any ground(s) of appeal before the disposal of appeal. iv. The appeal is well in time. 2. The facts relating to the issue in dispute are that the assessee-trust i.e. Improvement Trust, Abohar, is a trust constituted under the legislation of Punjab Government styled as "PUNJAB TOWN IMPROVEMENT ACT 1922" and the registration under Section 12AA of the Income-tax Act, 1961 (in short 'the Act') was granted to the assessee-trust w.e.f. 12.06.2003. In view of the amended definition of Section 2(15) of the Act with effect from 01.04.2009, show cause notices were issued to the assessee on 27.05.2011, 22.06.2012 & 30.10.2012 as to why the registration u/s 12AA granted to the assessee on 23.08.2010 may not be cancelled u/s 12AA(3) of the Act. In response to the same, the authorized representative of the assessee attended the proceedings and also submitted audited final accounts statements and audit reports for the assessment years 2008-09 to 2011-12. After perusing the documentary evidence filed by the assessee as well as the activities of the assessee-trust, lear....
X X X X Extracts X X X X
X X X X Extracts X X X X
....2 till date and receipts shown in the balance-sheet are the collection out of installments of sold property from the old schemes. In view of the audit reports for the preceding years, the assessee-trust has only bank interest and other petty receipts but not done any business and there was always loss except one year. He further stated that the assessee-trust is providing public utility service by way of building of roads, electrification, water supply and sewerage etc. and these are not in the nature of trade, commerce or business. 7. Learned counsel for the assessee further stated that the case-law relied upon by the learned CIT, Bathinda, in the impugned order are regarding the grant of registration under Section 12AA of the Act and not about the cancellation of registration under Section 12AA(3) of the Act, therefore, the case law relied upon by learned CIT, Bathinda, are not applicable in the case of assessee. At last, he requested that the impugned order may be cancelled by allowing the appeal filed by the assessee. No other argument has been advanced by learned counsel for the assessee nor has filed any paper book till date. 8. Learned DR relied upon the impugned order pas....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sp; (ii) shall, if he is not so satisfied, pass an order in writing refusing to register the trust or institution, and a copy of such order shall be sent to the applicant: Provided that no order under sub-clause (ii) shall be passed unless the applicant has been given a reasonable opportunity of being heard. (1A) All applications, pending before the Chief Commissioner on which no order has been passed under clause(b) of sub-section (1) before the 1st day of June, 1999, shall stand transferred on that day to the Commissioner and the Commissioner may proceed with such applications under that sub-section from the stage at which they were on that day. (2) Every order granting or refusing registration under clause (b) of sub-section (1) shall be passed before the expiry of six months from the end of the month in which the application was received under clause (a) or clause (aa) of sub-section (1) of section 12A (3) where a trust or an institution has been granted registration under clause (b) of sub-section (1) and subsequently the Commissioner is satisfied that the activities of such....
X X X X Extracts X X X X
X X X X Extracts X X X X
....gory as of the other real estate products available in the market, offered by the private colonizers and real estate agents. Learned CIT, Bathinda has also observed that the assessee advertised this product widely in print and electronic media so as to attract a large number of customers from all strata of the general public including the financially affluent. Thus, the assessee-institution sells off these plots, residential as well as commercial, by organizing a public auction through bidding process, as a result of which, the price of land escalates and finally, the land is sold off to the highest bidder, thus generating huge profits. 13. Learned CIT, Bathinda, in the impugned order also given various instances where the assessee is charging fees and fines on account of Composition Fees, Fines and Penalties, Transfer Fees, Sanction of Maps, Interest, Misc. Income, Enlistment Fees, Sale of Trust Land (Additional Area), Copying Fees, Increase in Valuation of Saleable Properties and Tender Fee and lastly held that keeping in view all these documentary evidences filed by the assessee-trust, he was fully satisfied that the activities of the assessee-institution were not charitable in....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... assessee to spend it on 'charitable purposes' only. 18. It is now pertinent to refer to the observations of the Income Tax Appellate Tribunal Chandigarh vide their judgment dated 01.06.2006 in the case of Punjab Urban Planning & Development Authority (supra) with regard to the provisions of section 2(15) of the Income Tax Act, 1961. It is held in the said order that this issue requires deliberation from a different angle whether the assessee was constituted to provide any charity to the public at large or to satisfy the needs for housing accommodation for the people of Punjab and also planning and development of the cities, towns and villages or whether the development in such a way is of charitable nature. A plea was raised by the learned Counsel for the assessee that funds are provided by the Punjab Government or generated by the assessee itself. To generate its funds for carrying out its objects, the assessee is acquiring lands, developing them are selling the plots to the general public who apply for the same. Even the economically weaker strata of the society is generally applying. It is not the case that the assessee is allotting houses to the poor masses free of cost. Whil....