TaxTMI 
TaxTMI 
2026 (7) TMI 567
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....l is preferred under Section 260A of the Income Tax Act, 1961 (for short "the Act") by the appellant - Revenue being aggrieved by the order dated 09.09.2011 passed by the Income Tax Appellate Tribunal, "A" Bench, Ahmedabad (for short "the Tribunal") in ITA No. 1682/Ahd/2011 for the Assessment Year 2008-09. 3. This tax appeal was admitted for consideration of the following substantial questions of law on 19.07.2012: "[1] Whether the Appellate Tribunal is right in law and on facts in restoring the matter to the file of the Assessing Officer with a direction to recompute the income of the assessee in light of the provisions of Section 11, 12 and 13 of the Income Tax Act, 1961 and in accordance with law after providing adequate oppo....
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....ns can then, be logically incidental. The amendment of 2016, inserting sub clause (i) to proviso to section 2(15) was therefore clarificatory. Thus interpreted, there is no conflict between the definition of charitable purpose and the machinery part of section 11(4A). Further, the obligation under section 11(4A) to maintain separate books of account in respect of such receipts is to ensure that the quantitative limit imposed by sub-clause (ii) to section 2(15) can be computed and ascertained in an objective manner. 169. The conclusion recorded above is also supported by the language of seventh proviso50 to section 10(230). Whereas section 2(15) is the definition clause, section 10 lists out what is not income. Section 10(23C) by su....
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....ng of the services, may be it may not be an exact equivalent, such mathematical precision being impossible in the case of variables, may be a little surplus is left over at the end of the year the broad inhibition against making profit is a good guarantee that the carrying on of the activity is not for profit". 171. Therefore, pure charity in the sense that the performance of an activity without any consideration is not envisioned under the Act. If one keeps this in mind, what section 2(15) emphasizes is that so long as a GPU's charity's object involves activities which also generates profits (incidental, or in other words, while actually carrying out the objectives of GPU, if some profit is generated), it can be granted ex....
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....iation, constitution, etc. advance any GPU object, such as development of housing, town planning, development of industrial areas, or regulation of any activity in the general public interest, supply of essential goods or services such as water supply, sewage service, distributing medicines, of food grains (PDS entities), etc., (b) While carrying on of such activities to achieve such objects (which are to be discerned from the objects and policy of the enactment, or in terms of the controlling instrument. such as memorandum of association etc.), the purpose for which such public GPU charity. is set-up whether for furthering the development or a charitable object or for carrying on trade, business or commerce or service in relation ....
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....nment or state is expected to engage in, having regard to provisions of the Constitution and the enacted laws, and the observations of this court in NDMC, whether in case surplus or gains accrue, the corporation, body or authority is permitted to distribute it, and if so, only to the government or state the extent to which the state or its instrumentalities have control over the corporation or its bodies, and whether it is subject to directions by the concerned government, etc.. (f) As long as the concerned statutory body, corporation, authority, etc. while actually furthering a GPU object, carries out activities that entail some trade, commerce or business, which generates profit (ie amounts that are significantly higher than the ....
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....bsp; 5. It appears that the Tribunal in the assessee's own case has followed the aforesaid order of the Hon'ble Apex Court for the Assessment Year 2009-10 against which Tax Appeal No. 2323 of 2010 was preferred by the revenue and this Court by order dated 25.04.2017, agreed with the order passed by the Tribunal to set aside the order passed by the Director of Income Tax (Exemption) cancelling the registration under Section 12AA of the Act for not giving any specific reason. This Court further held that merely because the respondent - assessee is in the business of selling plots or is involved in other trade or business, it cannot be said that the activities of the respondent - assessee are not in consonance with the obj....