TaxTMI 
TaxTMI 
2019 (11) TMI 1460
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....IT(A) has erred in the law and on facts in allowing the accumulation of Rs. 4,16,24,5037- u/s.11(2) and accumulation @15% of Rs. 3,43,02,447/- u/s.11(1)(a) of the Act without appreciating the fact that once the proviso to section 2(15) is applicable, the benefit of section 11 and 12 cannot be allowed further. 4. The revenue craves over leave to add, alter, amend, modify, substitute, delete and/or rescind all or any Grounds of Appeal on or before the final hearing, in necessity so arises. 2. Facts of the case are that the Assessee, Naroda Enviro Project Ltd. is a company registered u/s. 25 of the Companies Act. It is engaged in the activities of management of liquid and solid wastes in Naroda Industrial. Area. The Assessee company is registered u/s. 12AA of ihe 1, T, Act, vi.de order no R.NO. D1T(E)/ 1 2AA/624/05-06 dated 04/07/2007. The company is also approved u/s. 80G(5) of the 1. T. Act, 1961 by the office of the DIT(E), Ahmedabad. 3. During the course of assessments proceeding for AY 2009- 1 0, A.Y, 20 10- 11 and 2011-1.2, 20 12- 13 & 2013-14 it has been continuously held that the Assessee earned profit in the name of protection of environment and hence activities undertake....
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....and wild life) and preservation of monuments or places or objects of artistic or historic interest 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 they carrying on of 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 first proviso shall not apply if the aggregate value of the receipts from the activities referred to therein is ten lac rupees or less in the previous year." A plain reading of Section 2 (15), reproduced hereinabove, will reveal that preservation of environment is a charitable activity by itself. The appellant company had been actively engaged in preservation of the environment by controlling the pollution of air, water and soil by the pollutants generated by the industrial units located in Naroda Industrial Area. As a matter of fact, the Assesses being a company registered u/s. 25 of the Companies Act which does not exist ....
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...., 12AA and approval u/s. 80G (5), There is no change with respect to the facts as well as law." It is very significant to mention here that on the basis of the assessment order u/s. 143(3) for A.Y. 2009-10 wherein the AO has denied the benefits of the provisions of Section 11 and 12 to the appellant, the Director of Income Tax (Exemption/, Ahmedabad had issued a show cause notice u/s. 12AA (3j for cancellation of the registration granted to the appellant u/s, 12AA. The Hon'ble Director of Income Tax (Exemption), Ahmedabad on evaluation of evidence and appreciation of facts was convinced of the charitable activities carried out by the appellant and the proceedings initiated u/s. 12AA (3) of the I.T. Act had been dropped vide letter no, DIT(E)/12AA/Naroda/12-13/876 dated 15/3/2013. The appellant submits that the proviso below Section 2(15) would be applicable only in relation to the activity of advancement of any other object of general public utility, The appellant submits that when the amendment was made to Section 2 (15) of the I.T. Act vide Finance Act, 2008, the then Finance Minister in the Parliament made it very clear that genuine trusts will not suffer by virtue of th....
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....postulates that an earlier decision taken on issue is to be followed in the subsequent year if there is no change without respect 1o the facts and law. In the present ca.se of. the appellant Assesse.fi, there has been no change in respect of the activities earned on by the Assesses m the, preceding year and the year under appeal, there has been no change with respect to the facts as well as law. Therefore, the principle of consistency of approach is applicable in the appellant's case. The appellant submits that on principles of consistency, the action of the AO in denying the appellant benefits of the prow's ions of Section 11 and 12 of the I.T, Act is not maintainable in law, particularly so when such benefit was allowed to the appellant in the scrutiny assessments made for A.Y. 2008-09, 2006 07 and also in the summary assessment u/s. 143(1) in A.Y. 2007-08. Needless to mention here that the scrutiny assessment u/s. 143(3) r.w.s. 147 for A.Y. 2008-09 was passed by the Assistant Director of Income Tax (Exemption), Ahmedabad on I6/ 12/201 1 wherein the AO had accepted the income returned by the Assesses in accordance with the provisions of Section 1 1 of the Income Tax Act. ....
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....the predominant object of assessee. Assessee company was incorporated with a sole object to comply with directions of Hon'ble High Court of Gujarat in a PIL for industries of Naroda GIDC for establishment in running of Common Effluent Treatment Plant and its storage and disposal facility at Odhav, Ahmedabad. The project was setup under the directions and guidelines of Hon'ble High Court of Gujarat and various local and state level agencies viz. Collector, GIDC, AMC, GPCB, etc. As per directions of Hon'ble High Court of Gujarat, it was sine-qua-non for industrial units to become member of assessee company for meeting the pollution control parameters laid down by GPCB. The amount collected from the members varied depending upon the quantum of effluent, nature of effluent to be treated as well as other factors pertaining to pollutant of different kind coming from the industrial units. Thus, assessee is engaged in the activity of preservation of environment by abetment and controlling pollution of environment i.e. land, water and air. For this objective, assessee is providing pollution control treatment for disposal of liquid and solid industrial waste. It is undisputed tha....