TaxTMI 
TaxTMI 
2021 (11) TMI 417
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....mptions) erred on facts and in law treating unspent grant in aid received from the state government as income of the appellant and thereby denying registration u/s 12A of the Income tax Act, 1961. 5. That the Commissioner of Income Tax (Exemptions) erred in denying registration u/s 12A on the ground that the appellant had filed its return of income for the AY 18-19 in Form No. ITR-5. 6. The assessee craves leave to add/alter any of the ground of appeal on or before the date of hearing of appeal. From the aforesaid grounds it is gathered that the only grievance of the assessee relates to the rejection of application for grant of Registration under section 12A of the Income Tax Act, 1961 (hereinafter referred to as 'Act'). 3. Facts of the case in brief are that the assessee filed an application in Form No. 10A for registration under section 12A of the Act which was received in the office of the CIT(E) on 29/09/2018. The aims and objects of the assessee are to catalyse agroindustrial growth in different parts of the state based on principles of ecological sustainability, economic efficiency and social equity; to undertake or assist in undertaking programmers for employment gener....
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....vocability Clause. Please include this clause in your Trust Deed/ Memorandum of Association and file a certified copy of the amended Trust Deed/ Memorandum of Association. 14. Your Trust Deed/ Memorandum of Association does not have a clause that the beneficiaries are a section of the public and not specific individuals. Please include this clause in your Trust Deed/ Memorandum of Association and file a certified copy of the amended Trust Deed/ Memorandum of Association. 15. Details of Names and address of Settler, Trustees and members of the Trust/Trust along with the PANs & Email address. 16. An Affidavit giving clear undertaking that no fees charges etc had been collected for any services referred from the beneficiaries inviolation of provisions of section 2(15) of Income Tax Act. 17. Copies of Audited balance Sheets, Income & Expenditure account along with complete annexure for the last 03 Years or since the beginning of the trust. Receipts and Payment accounts for the relevant years was also called for. 18. A note regarding charitable activities being conducted by the society. Along with clarification as regards which specific limb under section 2(15) of the I.T. Act....
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.... schemes of Government of India namely Venture Capital Assistance Scheme (VCA), Equity Grant and Credit Guarantee Scheme (EGCGS) and economic inclusion of small and marginal farmers in agribusiness activities. 3.2 The assessee submitted to the Ld. CIT(E) that the assessee is involved in organizing small and marginal farmers as Farmers Interest Groups, Farmers Producers Organization (FPO) and Farmers Producers Company for endowing them with bargaining power and economies of scale. It was stated that the assessee society provides a platform for increased accessibility and cheaper availability of agricultural inputs to small and marginal farmers and in establishing forward and backward linkages in supply chain management. It was further stated that the main motive of the assessee society is mobilization of farmers for aggregation across the country with ultimate aim of sustainable business model and augmented incomes. Therefore, the operation of the assessee falls in the limb "any other object of public utility" under section 2(15) of the Act. It was also stated that assessee society was leading an initiative to incubate FPOs which will aggregate 2.50 lakh farmers across the country ....
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....adership Summit, Consultancy Charges, Foreign tour Expenses, Professional Charges, Salary and Management of FPOs which do not get covered by any limb of section 2(15) of the Act. He also observed that there was no expenses that had been shown which could qualify as utilization for charitable purposes since its inception. The Ld. CIT(E) held that the assessee society was not involved in any charitable work and in fact, it was a business consortium which helps the FPOs by providing subsidy and it intends to avail tax exemption by getting 12AA registration certificate from the department. 3.5 The Ld. CIT(E) also observed that objects of the assessee society were of a nature of research project and technology demonstration which could not be recorded visage of being charitable. Some of them were as under: 1. to sponsor specific and relevant research project and technology demonstrations; 2. to organise input, material supply and production services through public, private and cooperative sector; 3. to promote organisation of marketing chain both for domestic and export marketing 4. ; to build a cadre of skilled managers for managing the affairs of various units being establish....
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....e of the assessee society, on the basis of the said note it was submitted that the assessee society organized retailing in Fruits and Vegetables which brought dramatic changes in horticulture marketing in India and that required dedicated supply chain than the traditional approach of marketing of fresh produce and that the project is aimed on backward and forward integration by creating on farm infrastructure required for organized marketing of FFV. 5.2 It was contended that the Ld. CIT(E) in para 6 of the impugned order also accepted that the main object of the assessee society is mobilizing the farmers for the benefit of the farmers who are the part of the society at large and there is no need that the beneficiary to be a whole world. The reliance was placed on the following case laws: * Rana Caste Association Vs. CIT [1971] 82 ITR 704 (SC) * Bhartiya Kisan Sangh Sewa Niketan Vs. CIT(E),Lucknow [2017] 166 ITD 562 (Delhi) 5.3 The Ld. Counsel for the Assessee also referred to the Circular No. 11/2008 dt. 19/12/2008 issued by the CBDT which deals with the definition of charitable purpose under section 2(15) of the Act and submitted that the assessee fall in category 2.2 of the....
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....efit to the general public at large, therefore, the application moved by the assessee for registration under section 12AA of the Act was rightly rejected. 7. We have considered the submissions of both the parties and perused the material available on the record. In the present case it is not in dispute that the assessee society was formed keeping in view the benefit of the small and marginal farmers. The main objective of the assessee society is involving in organizing small and marginal farmers as Farmers Interest Groups, Farmers Producers Organisation and Farmers Producers Company for endowing them with bargaining power and economies of scale. The assessee society's operation was for enhancing agriculture production and farmers profitability through agriculture undertaking and by establishing the effective connect between the farmers and the agriculture eco system developed by the Government of India. 7.1 The objects of the assessee society are in the nature of advancement of any other object of the general public utility which fall in the definition of charitable purpose as defined under section 2(15) of the Act. The CBDT in Circular Number 11/2008 dt. 19/12/2008 clarify vide ....