TaxTMI 
TaxTMI 
2021 (12) TMI 1125
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....essee's Appeal):- 2. The grounds of appeal raised by the assessee read as under:- "1. Erred in rejecting assessee's plea that for all practical purpose being an agent of State Gov. of Gujarat and by virtue of provisions contained in Article 289 of the constitution of India, it cannot be subjected to assessment and levy of tax under the Income Tax Act. 2. Erred in holding receipts from premium on land given on lease are recurring and operational receipts, by considering 40% of lease income as revenue receipt 3. Erred in holding assessee cannot claim expenditure on capital assets as an application of funds and also not allowing claim of depreciation on the same considering the amount spent has not been offered to tax 4. Erred in directing to consider all receipts as income/revenue receipts irrespective of the facts assessee has treated the same as Balance sheet item 5. Erred in confirming that assessee has violated provisions of section 11(5) of the Act with regards to investment made in Gujarat Alkalies & Chemicals Ltd and GLFL thereby attracting provisions of section 13(1)(d) of the Act Erred in not considering the decision o....
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....the assessee are for carrying out the activity for charitable purpose. The Revenue carried the aforesaid decision of the Coordinate Bench in appeal before the Hon'ble Jurisdictional High Court without any success. The catch notes of the judgement of the Hon'ble Gujarat High Court are extracted hereunder:- Section 2(15), read with section 11, of the Income-tax Act, 1961 - Charitable purpose (Objects of general public utility) - Assessment year 2009-10 - Whether where assessee-corporation was constituted under Gujarat Industrial Development Act, 1962, for purpose of securing and assisting rapid and orderly establishment and organization of industrial areas and industrial estates in State of Gujarat, and for purpose of establishing commercial centers in connection with establishment and organization of such industries it could not be said that activities carried out by assessee were either in nature of trade, commerce or business, for a Cess or Fee or any other consideration so as to attract proviso to section 2(15) and same could be said to be for charitable purpose and, consequently, assessee was entitled to exemption under section 11 - Held, yes [Paras 15 and 17] [In favou....
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....(Revenue's Appeal):- 5. The grounds of appeal raised by the Revenue read as under:- "1. Erred in wrongly applying provisions of Section 2(15) of the Act and holding activity of assessee are not under the "advancement of general public utility" 2. Erred in allowing exemption under section 11 & 12 of the Act 3. Erred in allowing operational expense @60% of the total premium received on land/shades without appreciating the facts and examination of the actual expense incurred. 4. Erred in deleting addition of Rs. 12,00,667/- made on a/c of deemed rent income 5. General" 6. Ground No.1:- At the very onset of the proceeding the Ld. Senior Counsel appearing for the assessee submitted before us that the issue is squarely covered in assessee's own case in ITA No. 278/Ahd/2013, 493&2346/Ahd/2014 for A.Y. 2009-10 to 2011-12 copy whereof has also been submitted before us. Such submission has not been controverted by the Ld. DR with all his fairness. 7. While dealing with the issue the Ld. Tribunal has been pleased to observe as follows:- "29. After considering the entire facts in totality, in the light of the decisions discussed he....
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....ordingly with similar directions to the A.O. 35. In the result, the appeals filed by the Assessee are allowed." 8. Ground No.2:- This ground is covered in assessee's own case by the order passed by the Coordinate Bench which was further been confirmed by the Hon'ble Jurisdictional High Court in the case of CIT vs. GIDC (2017) taxmann.com 366 (Guj.) as the submission made by the Ld. Senior Counsel appearing for the assessee which has not been controverted on factually or legally by the Ld. DR. 9. We have heard the respective parties and we have also perused the relevant materials on record. 10. The crux of the ratio of the judgment passed by the Hon'ble Jurisdictional High Court in the case of CIT vs. GIDC (2017) 83 taxmann.com 366 (Guj.) appearing from the head notes are as follows:- "Section 2(15), read with section Income from property held for charitable or religious purposes 11, of the Income-tax Act, 1961 - Charitable purpose (Objects of general public utility) - Assessment year 2009-10 - Whether where assessee-corporation was constituted under Gujarat Industrial Development Act, 1962, for purpose of securing and assisting rapid and orderly establish....
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....f deemed rent of vacant quarters: 6.1 In this connection, appellant states that it is a corporation duly registered under section 12AA of the Income Tax Act, 1961, hence, the provision of deemed rent is not applicable. However, by considering the proviso to section 2(15) of the Act, Assessing Officer has assessed the appellant's income as a regular business income and accordingly made an addition of Rs. 12,00,667 as a deemed rent. Further, it is pertinent to note that the Hon'ble ITAT, Ahmedabad in its order passed dated 10/01/2017 for A.Y. 2009-10 to A.Y. 2011-12, has considered the appellant as charitable entity and stated that first proviso to Section 2(15) of the Act is not applicable in the case of the appellant on the facts of the case. Therefore, the provision of deemed rent is not applicable in the case of appellant as no notional income can be taxed as per provisions of section 11 of the Act. 6.2 In view of aforesaid facts, it is crystal clear that the reliance placed by your good honor in the case of Radhadevi Dalmia V/s CIT 125 ITR 134 is not relevant as per the facts of the case as appellant is a trust duly registered under section 12AA of the Act for ....
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....pply mutatis mutandis. 20. Ground No. 4 is general in nature. There is no need of separate adjudication. ITA No. 308/Ahd/2019(A.Y. 2015-16)(Revenue's Appeal):- 21. The grounds of appeal raised by the Revenue reads as under:- "1. Erred in wrongly applying provisions of Section 2(15) of the Act and holding activity of assessee are not under the "advancement of general public utility" 2. Erred in allowing exemption u/s 11 & 12 of the Act 3. Erred in allowing proportionate cost of lease premium of land amounting to 60% of total receipts as against total the total receipts of Rs. 703,30,00,837/- 4. Erred in deleting addition of Rs. 8,02,879/- made on a/c of deemed rent income 5&6. Erred in directing to allow depreciation as per normal commercial principles and rule of accountancy when as per newly inserted amendment in section 11(6), depreciation is not allowable to the assessee from A.Y. 2015-16 7. General" 22. Ground No. 1:- This ground has already been decided by us in ITA No. 808/Ahd/2018 for A.Y. 2014-15 in Ground No. 1 therein. In the absence of any changed circumstances the same shall apply mutatis mutandis. 23.....