INCOME TAX ACT, 1961

Section 11

Charitable trust - Exemption under section 11 - Applicability of proviso to section 2(15) - Collection of fee/cess by assessee engaged in advancement of any other object of general public utility without any profit motive

Assessee Gujarat Maritime Board was established for the purpose of administering, controlling and managing minor ports in the State of Gujarat. It claimed exemption under section 11. AO denied emption holding that income of assessee included income from port infrastructure facilities, marine services, clearing, forwarding and stevedoring, storage rental, equipment rental, income from other port services and GoG Administrative charges, which suggested that assessee was carrying out activity in the nature of trade, commerce of business by charging cess or and therefore, proviso to section 2(15) got attracted to assessee's case.Held: Assessee was established for predominant purposes of development of minor ports within the State of Gujarat management and control of the Board was essentially with the State Government and there was no profit motive, as indicated by section 73,74 ad 75 of the Gujarat Maritime Board Act, 1981. Income earned by the Board was deployed for development of minor ports in the State of Gujarat and, therefore, assessee was registered as charitable trust under section 12A. Accordingly, assessee being a charitable trust carrying on activity of advancement of public utility without any profit motive was required to be assessed as per section 11(1).

Relied:(2017) 83 Taxman.com 366 (Guj) : 2017 TaxPub(DT) 1934 (Guj-HC), CIT v. Gujarat Industrial Development Corporation, dated 28-6-2017 and Ahmedabad Urban Development Authority v. Asstt. CIT(E) (2017) 83 Taxman.com 78 (Guj) : 2017 TaxPub(DT) 1863 (Guj-HC).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2014-15

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