TaxTMI 
TaxTMI 
2023 (12) TMI 214
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....oval under section 80G(5) of the Act. 2. The learned CIT has erred in holding that the Appellant Trust is engaged in commercial activity not falling within the purview of 'charitable purpose' as required under section 80G(5) of the Act. 3. The learned CIT has erred in passing the impugned order without granting effective opportunity of hearing to the Appellant Trust. The Appellant Trust craves leave to add, alter, amend or withdraw all or any of the Grounds of Appeal herein and to submit such statements, documents and papers as may be considered necessary either at or before the appeal hearing." 3. The only dispute raised by the assessee, in the present appeal, is against the denial of approval under section 80G of the Act. 4. The brief facts of the case pertaining to this issue, as emanating from the record, are: The assessee filed an application in Form 10AB seeking approval under section 80G of the Act. Form 10AC in this case was issued by the CPC granting provisional approval under section 80G of the Act. Vide order dated 30/03/2023 the learned CIT(E) rejected the prayer of the assessee for grant of approval under section 80G of the Act ....
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....e much market value. It was further submitted that the assessee does not sell these granules to Huhtamaki India Ltd. as they require different quality of plastic raw material. 6. On the other hand, the learned Departmental Representative ("learned DR") submitted that CSR funds from the company were transferred to the assessee and therefore there is a nexus between the company and the assessee. It was further submitted that the assessee is engaged in the commercial activity, since as per its one of the objects it can provide integrated recycling and waste management services, ranging from simple recycling collections to full recycling and waste management solutions to businesses of all sizes. The learned DR submitted that the activities carried out by the assessee fall under the residual category of advancement of any other object of general public utility. 7. We have considered the submissions of both sides and perused the material available on record. The assessee was settled as an irrevocable trust, vide Trust Deed dated 09/10/2019, with the main object to work in the area of preservation of environment. The assessee is registered under the Bombay Public Trusts Act, 1950. F....
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....consumer goods value chain: chemical and plastic manufacturers, fast moving consumer goods companies, retailers, manufacturers, converters, waste management companies' municipal Corporations, NGOs and small businesses across different countries; k. To provide integrated recycling and waste management services ranging from simple recycling collections to full recycling and waste management solutions to businesses of all sizes; l. To work in close association with government bodies, inter governmental organizations, academia, Municipal Corporations, Housing Society and to invest in joint projects to eliminate & recycle plastic waste from the environment. j. To provide financial aid/ assistance to any other individual working in the related field or institutions having similar objects as mentioned herein above; k. To publish pamphlets, magazines and/or books or literature related to recycling of plastic wastes m. To undertake any such project, program, activities, campaigns, related to the area of conversation of environment and pollution abatement." 9. As per the assessee, the majority of the plastic waste generated in India pertain....
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....hich the institution or fund is constituted or the rules governing the same do not contain any provision for transfer or application at any time of the whole or any part of the income or assets of the institution of fund for any purpose other than charitable purpose; (c) The institution or fund is not for the benefit of any particular religious community or caste; (d) The institution or fund maintains regular accounts of its receipts and expenditure; and (e) The institution or fund is either constituted as a public charitable trust or is registered under the Societies Registration Act, 1860, or under any other law corresponding to that Act. 12. We find that vide Finance (No.2) Act, 2009 with retrospective effect from 01/04/2009, preservation of environment (including watersheds, forests, and wildlife), was included in the definition of "charitable purpose" under section 2(15) of the Act. From the perusal of the memorandum explaining the provisions in the Finance (No.2) Bill, 2009, forming part of the paper book from pages 77-79, we find that such an amendment was made so as to exclude the preservation of environment from the applicability of the condit....
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.... 15. As regards the objection of the learned CIT(E) that the assessee is established for the spending CSR funds of Huhtamaki India Ltd, we find that the Hon'ble Gujarat High Court in CIT v/s Naroda Enviro Projects Ltd., [2019] 419 ITR 482 (Guj.) held that just because the members of the taxpayer are being benefited and their statutory liability is being discharged by the assessee, by itself, would not be sufficient to hold that the assessee could not be said to have been set up for charitable purpose. In the present case, it is also pertinent to note that the MLP waste which is recycled by the assessee is collected from Pune and other nearby areas by NGOs and Huhtamaki India Ltd is not the direct source of such waste. Therefore, in view of the aforesaid decision, we find no merits in the aforesaid basis of the learned CIT(E) in rejecting the approval under section 80G of the Act. 16. Further, the assessee has submitted that Huhtamaki India Ltd does not purchase any product manufactured by the assessee nor use it as raw material. In support of this submission, the assessee has placed on record the list of parties to whom granules produced after recycling MLP waste were sold du....