2014 (12) TMI 1314

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.... filed by the appellant, are challenged. 2. Since the issues raised in these appeals are identical in nature, these appeals were heard together and are being disposed of by the common judgment treating ITA No.208 of 2014 as the leading case. 3. The appellant is an authority constituted by the Government of Kerala, under the Town Planning Act for the planning and development of Greater Cochin Area. In so far as ITA No.208/2014 is concerned, the facts which are relevant are that the appellant filed its return of income for the A.Y. 2009-10 on 29.09.2009, returning total income at NIL and claiming exemption under Section 11 of the Act. The Assessing Officer considered the matter and taking note of the amended provision of Section 2(15) of th....

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.... object of general public utility shall not be a charitable purpose, if it involves the carrying on of any activity in the nature of trade, commerce or business, or any activity of rendering any service in relation to any trade, commerce or business, for a cess or fee or any other consideration, irrespective of the nature of use or application, or retention, of the income from such activity: Provided further that the proviso shall not apply if the aggregate value of the receipts from the activities referred to therein is twenty five lakhs rupees or less in the previous year." 8. In so far as the first part of Section 2(15) is concerned, even according to the appellant, its activities are in advancement of objects of general public utilit....

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....ers Association, Surat (1980 (121) ITR 1), where the Apex court held that where the predominant object of the activity is to carry out the charitable purpose and not to earn profit, the assessee would not lose its character of charitable purpose merely because some profit arises from the activity carried on by it. The assessee also referred us to the budget speech of the Finance Minister while introducing the Finance Bill 2008 and also Circular No.11 of 2008, dated 19.12.2008 and contended that only in a situation where an assessee is trying to cover up its actual commercial activities in the guise of charity that the benefit of Section 2(15) can be denied. 10. These contentions raised by the assessee will have to be appreciated with refer....

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....need for housing accommodation of various sections of the people and especially for planning and development in the cities, towns and villages. It was therefore that they pointed out that they acquired land at nominal rates, developed the same and sell it to general public. It was also their case that they are executing several works of infrastructural development such as markets, water supply and sewerage, development of sports complexes, bridges, bus stand, swimming pools, community centers, public toilets, parks, cremation grounds, schools etc,. 12. We have already stated that for the assessment year, the total income assessed was Rs. 8,00,94,700/-. It is undisputed that the appellant is charging fees for supervision and centage charges....