The Dy. Commissioner of Income Tax, Chandigarh V. M/s Kapurthala Improvement Trust, Kapurthala

ITA 645/ASR/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 0678 (ITAT-AMRITSAR)
• Duration Of Justice: 6 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-06-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 14-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A N MISHRA
• Assessee Lawyers: Y K SUD
• Keywords: Charitable institution
• Section: 143(3); 12; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. (CAMP AT JALANDHAR) BEFORE SH. A.D. JAIN, JUDICIAL MEMBER AND SH. T.S. KAPOOR, ACCOUNTANT MEMBER ITA NO.644(ASR)/2015 ASSESSMENT YEARS:2012-13 PAN: AAATI4915Q DY. COMMR. OF INCOME TAX VS. M/S. HOSHIARPUR IMPRO VEMENT TRUST, CIRCLE 1 (EXEMPTION) HOSHIARPUR. CHANDIGARH. (APPELLANT) (RESPONDENT) ITA NO.645(ASR)/2015 ASSESSMENT YEARS:2012-13 PAN: AAALK0503K DY. COMMR. OF INCOME TAX VS. M/S. KAPURTHALA IMPRO VEMENT TRUST, CIRCLE 1 (EXEMPTION) KAPURTHALA. CHANDIGARH. (APPELLANT) (RESPONDENT) ITA NO.646(ASR)/2015 ASSESSMENT YEARS:2012-13 PAN: AHDPG2985N DY. COMMR. OF INCOME TAX VS. M/S. KARTARPUR IMPROV EMENT TRUST, CIRCLE 1 (EXEMPTION) KARTARPUR, DISTT. JALANDHAR. (APPELLANT) (RESPONDENT) ITA NO.647(ASR)/2015 ASSESSMENT YEARS:2012-13 PAN: AAATJ4768N DY. COMMR. OF INCOME TAX VS. M/S. JALANDHAR IMPROV EMENT TRUST, CIRCLE 1 (EXEMPTION) JALANDHAR. 2 ITA NOS. 644 TO 647(ASR)/2015 A.Y.2012-13 (APPELLANT) (RESPONDENT) APPELLANT BY: SH.A.N. MISHRA, DR RESPONDENT BY: SH. Y.K. SUD, CA DATE OF HEARING: 21/06/2016 DATE OF PRONOUNCEMENT: 22/06/2016 ORDER PER A.D. JAIN, JM; THESE ARE THE DEPARTMENTS APPEALS FOR THE ASSESSM ENT YEAR 2012-13, AGAINST THE ORDERS DATED 28.09.2015 AND 21.09.2015, PASSED BY THE LD. CIT(A)- 2, JALANDHAR. AS THE ISSUE INVOLVED IN ALL THE APPE ALS IS COMMON, THEREFORE, THESE APPEALS ARE BEING DISPOSED OF BY THIS COMPOS ITE ORDER, FOR THE SAKE OF CONVENIENCE. 2. THE REVENUE HAS RAISED THE FOLLOWING COMMON GRO UNDS IN ALL APPEALS: 1. THAT THE ORDER OF LD. CIT(A) IS DEFECTIVE BOTH IN LAW AND FACTS OF THE CASE. 2. THAT THE ORDER OF THE LD. CIT(A) IS BAD IN LAW A S THE AMENDMENT IN SECTION 2(15) IS EFFECTIVE W.E.F. 01.04.2009 AND TH E ASSESSMENT IN THE CASE HAS BEEN COMPLETED CONSIDERING THE ACTIVIT IES OF ASSESSEE WHICH ARE NOT ADVANCEMENT OF ANY OTHER OBJECT OF G ENERAL PUBLIC UTILITY. 3. THAT THE ORDER OF LD. CIT(A) IS BAD IN LAW BY IG NORING THE RATIO LAID IN THE CASES OF PUDA AND JDA (TO THE EXTENT IMPROV EMENT TRUSTS CARRY OUT LAND DEVELOPMENT IN A SIMILAR MANNER AS D EVELOPMENT AUTHORITIES DO.) 3. FIRST OF ALL, WE WILL DEAL WITH ITA NO.644(ASR)/ 2015 IN THE CASE OF HOSHIARPUR IMPROVEMENT TRUST, HOSHIARPUR. THE BRIEF FACTS OF THE CASE ARE THAT 3 ITA NOS. 644 TO 647(ASR)/2015 A.Y.2012-13 THE ASSESSEE IS A TRUST, WHOSE MAIN OBJECTS ARE AD VANCEMENT OF THE OBJECTS FOR THE UTILITY OF GENERAL PUBLIC, SUCH AS PROVIDING S TREETS, HOUSING FACILITIES, DRINKING WATER FACILITIES, SEWERAGE FACILITIES, ETC . THE ASSESSEE TRUST FILED ITS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION O N 29.12.2014, DECLARING THEREIN NIL INCOME AFTER CLAIMING ITS ENTIRE INCOME AS EXEMPT UNDER SECTIONS 11 & 12 OF THE INCOME TAX ACT, 1961. HOWEVER, THE ASSE SSMENT IN THIS CASE WAS COMPLETED U/S 143(3) OF THE ACT AT AN ASSESSED INCO ME OF RS.1,65,96,970/-, WHICH REPRESENTED EXCESS OF INCOME OVER EXPENDITURE EARNED BY THE ASSESSEE TRUST DURING THE YEAR UNDER CONSIDERATION. THE AO D ENIED THE EXEMPTION CLAIMED BY THE ASSESSEE TRUST UNDER SECTIONS 11 & 1 2 OF THE ACT, AS IN THE OPINION OF THE AO, THE ASSESSEE TRUST IS DOING TRAD E, COMMERCE AND BUSINESS, JUST LIKE A COLONIZER WHO DEVELOPS THE LAND, CONSTR UCTS FLATS AND COMMERCIAL BOOTHS AND THEN SELLS THESE ASSETS FOR EARNING PROF IT, WHICH IS CONTRARY TO THE AIMS AND OBJECTIVES OF THE ASSESSEE TRUST AND AS S UCH, THE ACTIVITIES OF THE ASSESSEE TRUST CANNOT BE SAID TO BE CHARITABLE IN N ATURE, IN VIEW OF THE AMENDED PROVISIONS OF SECTION 2(15) OF THE ACT. 4. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE W ENT IN APPEAL BEFORE THE LD. CIT(A), WHO DELETED THE ADDITION. 5. NOW, THE DEPARTMENT IS AGGRIEVED WITH THE ORDER OF THE LD. CIT(A) AND IS IN APPEAL BEFORE THIS BENCH. 4 ITA NOS. 644 TO 647(ASR)/2015 A.Y.2012-13 6. THE LD. DR CONTENDED THAT THE ORDER OF THE LD. CIT(A) IS BAD IN LAW, AS THE AMENDMENT IN SECTION 2(15) IS EFFECTIVE W.E.F. 01.04.2009 AND THE ASSESSMENT IN THE CASE HAS BEEN COMPLETED CONSIDERI NG THE ACTIVITIES OF THE ASSESSEE, WHICH ARE NOT FOR ADVANCEMENT OF ANY OTH ER OBJECT OF GENERAL PUBLIC UTILITY. 7. THE LD. COUNSEL FOR THE ASSESSEE, ON THE OTHER H AND, RELIED ON THE ORDER OF THE LD. CIT(A) AND REITERATED THE SUBMISSIONS MA DE BEFORE HIM. 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PER USED THE MATERIAL AVAILABLE ON RECORD. WE HAVE ALSO GONE THROUGH THE ORDER PASSED BY THE LD. CIT(A). WE ARE OF THE VIEW THAT THE LD. CIT(A) HA S PASSED A DETAILED AND WELL REASONED ORDER, WHICH REQUIRES NO INTERFERENCE . TH E RELEVANT FINDINGS OF THE LD. CIT(A) ARE REPRODUCED AS UNDER: 5.2. I HAVE CONSIDERED THE OBSERVATIONS OF THE AO AS MADE BY HIM IN THE ASSESSMENT ORDER. I HAVE ALSO CONSIDERED THE WR ITTEN SUBMISSIONS OF THE ASSESSEE FILED VIDE LETTER DATED 28.09.2015 IN CONNECTION WITH THE ISSUE UNDER REFERENCE. I HAVE FURTHER CONSIDERED TH E ORDERS OF THE ITAT, AMRITSAR BENCH, AMRITSAR DATED 10.09.2015 IN THE CA SE OF THE ASSESSEE TRUST ITSELF (ITA NOS. 496(ASR)/2013 & 18(ASR)/2015 FOR THE A.YS. 2009-10 & 2011-12). VIDE SAME ORDER DATED 10.09.2015, THE H ONBLE ITAT, AMRITSAR BENCH, AMRITSAR HAS ALSO DECIDED APPEALS F ILED BY OTHER IMPROVEMENT TRUSTS ENGAGED IN SIMILAR ACTIVITIES NA MELY M/S. JALANDHAR IMPROVEMENT TRUST (ITA NO.402/ASR/2014 FOR A.Y.2010 -11), M/S. PATHANKOT TRUST ( ITA NO. 200/ASR/2010 AND ITA NO.3 36/ASR/2014 FOR THE A.YS. 2005-06 & 2009-10), IMPROVEMENT TRUST, MO GA (ITA NO.760/ASR/2014 FOR THE AY 2011-12), IMPROVEMENT TR UST BATHINDA ( ITA NO. 636 AND 637/ASR/2013 FOR THE A.YS. 2004-05 AND 2005-06. THE ORDER OF THE HONBLE ITAT IN ITS OWN CASE WHICH IS ALSO THE LEAD CASE HAS HEAVILY BEEN RELIED UPON THE LD. AR OF THE ASSESSEE TRUST. IT HAS BEEN SUBMITTED THAT THE ITAT, AMRITSAR BENCH, AMRITSAR H AS ALLOWED THE 5 ITA NOS. 644 TO 647(ASR)/2015 A.Y.2012-13 APPEAL OF THE ASSESSEE TRUST ITSELF VIDE ITS ORDER IN ITA NOS. 496/ASR/2014 & 18(ASR)/2015, DATED 10.09.2015 WHILE DECIDING THE APPEAL OF THE ASSESSEE TRUST FOR THE AY 2009-10 AN D 2011-12 WHERE SIMILAR ISSUE WAS INVOLVED. IN OTHER WORDS, THE HON BLE ITAT, AMRITSAR BENCH, AMRITSAR HAS DELETED THE ADDITION MADE BY TH E AO AFTER DENYING EXEMPTION TO THE ASSESSEE TRUST CLAIMED BY IT U/SS 11 & 12 OF THE ACT. ON CAREFULLY CONSIDERATION OF THE RIVAL CONTENTION, IT HAS BEEN NOTICED THAT THE IMPROVEMENT TRUSTS IN PUNJAB WERE ESTABLISHED U NDER PUNJAB TOWN IMPROVEMENT ACT, 1922 WITH THE OBJECTIVE OF DEVELOP MENT OF TOWNS IN PUNJAB BY PROVIDING PARKS, COMMUNITY CENTRES AND AL SO PREPARING HOUSING AND RE-HOUSING SCHEMES FOR ALL SECTIONS OF SOCIETY IRRESPECTIVE OF ANY CASTE, COLOUR AND CREED. THE ASSESSEE TRUST NA MELY M/S. HOSHIARPUR IMPROVEMENT TRUST WAS ALSO SET UP FOR DEVELOPMENT O F THE HOSHIARPUR TOWN UNDER THE SAME ACT. TILL A.Y. 2003-04, THE INC OME OF THE ASSESSEE TRUST WAS EXEMPT U/S 10(20) OF THE ACT AND THEREAFT ER SECTION 10(20) WAS AMENDED AND THE TRUST WAS TAKEN OUT OF THE PURVIEW OF SECTION 10(20) AND THE ASSESSEE IMPROVEMENT TRUST APPLIED FOR REGI STRATION U/S 12A/12AA OF THE ACT WHICH WAS GRANTED BY THE THEN W ORTHY CIT-1, JALANDHAR, VIDE HIS ORDER F.NO. CIT/JL-I/TRUST/222/ 05-06 DATED 26.04.2006 W.E.F. 01.04.2005. 5.3. THE ASSESSEE TRUST FILED ITS RETURN OF INCOME DECLARING THEREIN NIL INCOME ON 25.09.2012 AFTER CLAIMING THE EXEMPTION I N RESPECT OF ITS ENTIRE INCOME OF RS.1,65,96,470/- AS EXEMPT U/S 11 & 12 OF THE ACT. HOWEVER, THE A.O. WHILE MAKING THE ASSESSMENT DENI ED THE EXEMPTION CLAIMED BY THE ASSESSEE TRUST U/S 11 & 12 OF THE AC T AND ASSESSED THE TAXABLE INCOME OF THE ASSESSEE TRUST AT RS.1,65,96, 470/- ON THE GROUND THAT THE ASSESSEE TRUST IS ENGAGED IN THE BUSINESS OF SALE AND PURCHASE OF RESIDENTIAL HOUSES, CONSTRUCTION OF MULTISTORIED HOUSES, SALES OF RESIDENTIAL PLOTS AND COMMERCIAL PLOTS BY AUCTION I N A FREQUENT AND SYSTEMATIC MANNER AND EARNED A HUGE NET PROFIT OF R S.11,65,96,470/- DURING THE YEAR UNDER CONSIDERATION AND THE ACTIVIT IES OF THE ASSESSEE TRUST CANNOT BE SAID TO BE CHARITABLE IN NATURE. IN THE OPINION OF THE A.O,, THIS ACTIVITY OF THE ASSESSEE WAS IN THE NATU RE OF TRADE, COMMERCE, AND BUSINESS BUT DOES NOT FALL WITHIN THE MEANING O F THE WORDS ADVANCEMENT OF ANY OTHER OBJECT FOR GENERAL PUBLIC UTILITY UNDER SECTION 2(15) OF THE ACT. 5.4. THE ASSESSEE TRUST CHALLENGED THE FINDINGS OF THE AO IN THE APPEAL BEFORE ME AND SUBMITTED WRITTEN SUBMISSIONS VIDE LE TTER DATED 28.09.2015 WHICH HAVE ALREADY BEEN REPRODUCED ABOVE . IN THE WRITTEN SUBMISSIONS, THE LD. AR OF THE ASSESSEE TRUST HAS S UBMITTED THAT THE ISSUE IS COVERED AND DECIDED IN FAVOUR OF THE ASSES SEE TRUST BY THE ORDER OF THE HONBLE ITAT, AMRITSAR DATED 10.09.2014 (SUP RA) ( IN THE CASE OF 6 ITA NOS. 644 TO 647(ASR)/2015 A.Y.2012-13 ASSESSEE ITSELF), COPY OF WHICH HAS ALSO BEEN PLACE D BEFORE ME WHICH IS ALSO TAKEN ON RECORD. 5.5. I HAVE PERUSED THE ORDER OF THE HONBLE ITAT, AMRITSAR BENCH IN THE CASE OF HOSHIARPUR IMPROVEMENT TRUST ITSELF FOR THE A.TS. 2009-10 & 2011-12 DATED 10.09.2015 WHEREIN IT HAS BEEN HELD A S UNDER: 35. WHILE DEALING WITH THE PROFIT MOTIVE ALLEGATION OF THE REVENUE AUTHORITIES, IT IS ESSENTIAL TO APPRECIATE THE DIFFERENCE THAT PROFIT ON SALE DOES NOT ESSENTIALLY AND NECESS ARILY IMPLY PROFIT MOTIVE IN ACTIVITIES OF THE ASSESSEE TRUST. WHAT IS IMPORTANT IS THE MOTIVE OR PREDOMINANT OBJECT OF TH E ACTIVITIES. AS WE DO SO, WE MAY ONLY MAKE A NOTE OF THE FOLLOWI NG OBSERVATIONS MADE BY A COORDINATE BENCH DECISION IN THE CASE OF DEVKI DEVI FOUNDATION VS DIT [(2015) 56 TAXMANN.COM 56 (DELHI)] : 29THE SOUL OF CHARITY IS BENEVOLENCE AND GENEROSITY TOWARDS OTHERS AND THE COMMUNITY AT LARGE. OF COURSE, IT IS IMPORTANT AS TO WHAT ARE TH E ACTIVITIES OF A CHARITABLE INSTITUTION BUT WHAT IS EVEN MORE IMPORTANT IS WHAT IS THE PREDOMINANT MOTIVATIO N FOR SUCH ACTIVITIES. NO ACTIVITY, BY ITSELF, COULD BE CHARITABLE IN NATURE WHEN IT IS DOMINATED AND TRIGG ERED BY ECONOMIC GREED. THERE IS NO DIFFERENCE IN WHAT A SOLDIER AND A MERCENARY DOES, BOTH USE BULLETS TO D EFEND THEIR INTERESTS, BUT WHILE A SOLDIER DOES IT OUT OF PATRIOTISM, A MERCENARY DOES IT FOR MONETARY GAIN. THE ACTION IS THE SAME, AND YET MOTIVATION FOR THE ACTI ONS ARE SO MATERIALLY DIFFERENT THAT THE CHARACTER OF A CTIVITY IS ALTOGETHER CHANGED. CLEARLY, UNDERLYING MOTIVE A ND TRIGGER FOR DOING WHAT A PERSON DOES IS, IS IMPORTA NT FOR DETERMINING WHETHER SUCH AN ACTION IS IN THE COURSE OF BUSINESS OR CHARITY. WHAT IS REALLY, THEREFORE, REQ UIRED TO BE CAREFULLY EXAMINED, IN ORDER TO FIND WHETHER AN ACT OF THE INSTITUTION IS CHARITABLE OR NOT, IS NOT ONLY T O ASSESS THE WORK BEING DONE BY THE INSTITUTIONS, WHICH CLAI M TO BE PURSUING CHARITABLE ACTIVITIES, BUT ALSO THE ECO NOMIC DYNAMICS AND MOTIVATIONS OF SUCH ACTIVITIES. 36. LEARNED DEPARTMENTAL REPRESENTATIVE HAS POINTED OUT THAT THE COMMERCIAL PLOTS AND UNITS ARE AUCTIONED O FF WHICH 7 ITA NOS. 644 TO 647(ASR)/2015 A.Y.2012-13 SHOWS THAT THE IDEA IS TO MAKE MAXIMUM PROFITS BUT WHAT HE CLEARLY OVERLOOKS IS THE FACT THAT SINCE IT IS NOT A DESIRABLE STATE OF AFFAIRS FOR THE STATE TO SUBSIDIZE BUSINES SES, AND TO ENSURE HIGHEST DEGREE OF TRANSPARENCY IN MAXIMISING RETURNS FROM PUBLIC ASSETS, COMPETITIVE BIDDING FOR COMMERC IAL UNITS IS A SAFE OPTION, AND THAT THE USE OF BIDDING PROCESS IS JUSTIFIED FOR THE LARGER CAUSES. THE BIDDING PROCESS ENSURES TRANSPARENCY IN FUNCTIONING OF THE IMPROVEMENT TRUS TS AND THAT, BY ITSELF, DOES NOT MAKE THE FUNCTIONING OF T HE IMPROVEMENT TRUST A COMMERCIAL VENTURE. IT IS ALSO IMPORTANT THAT THIS USE OF BIDDING PROCESS IS ONLY IN THE CO NTEXT OF COMMERCIAL UNITS ETC. THE DEVELOPMENT OF COMMERCIAL AREAS IS IN THE INTEREST OF PLANNED GROWTH OF AN AREA AND WH EN SUCH COMMERCIAL AREAS DEVELOP, ALL THE STAKEHOLDERS IN T HE DEVELOPMENT OF THAT AREA BENEFIT. IN ORDER OF THIS BENEFIT TO THE COMMON CAUSE, IT IS NOT NECESSARY THAT THE BUSINESS MEN, BUYING SUCH UNITS, MUST ALSO BENEFIT. THE DENIAL OF ANY ADVANTAGE, AT THE COST OF GENERAL PUBLIC, TO THE BU SINESS ENTITIES BUYING THE COMMERCIAL AREAS, IN OUR CONSID ERED VIEW, DOES NOT AMOUNT TO AN DEFEATING AN OBJECT OF GENERA L PUBLIC UTILITY. IN THIS CONTEXT, IT IS IMPORTANT TO UNDER STAND THE BENEFIT FROM DEVELOPING COMMERCIAL AREAS, WHICH IS FOR PUBL IC GOOD, AND BENEFIT TO THE BUSINESS PERSONS IN BUYING THESE UNITS FROM THE ASSESSEE TRUST, WHICH CAN ONLY BE FOR THE GOOD OF BENEFIT OF THESE ENTREPRENEURS. AS FOR THE SALE OF RESIDENTIA L UNITS, IT IS AN ADMITTED POSITION THAT IN TERMS OF THE PUNJAB TOWN IMPROVEMENT (UTILIZATION OF LAND AND ALLOTMENT OF PLOTS) RULES, 1983, THERE IS A FORMULAE ON THE BASIS OF WHICH THE PRICE IS WORKED OUT. LEARNED DEPARTMENTAL REPRESENT ATIVE DOES NOT DISPUTE THAT ASPECT BUT HE ALLEGES PROFIT MOTIVE EMBEDDED IN THIS FORMULA AS SHOWN BY ADJUSTMENTS FO R (A) CONSERVANCY CHANGES FOR 5 YEARS @ 10% PER MONTH PER ACRE; AND (B) PROVISION FOR UNFORESEEN CHARGES @ 15% OF T OTAL RESERVE PRICE. FIRSTLY, EVEN IF THIS ALLEGATION ABOUT PRE SENCE OF THE TWO ELEMENTS ONLY TO MAXIMIZE THE PROFIT BE TAKEN AS CO RRECT, IT IS IMPORTANT TO BEAR IN MIND THE FACT THAT THIS IS NOT THE PRESENCE OF PROFIT ELEMENT IN THE ACTIVITIES WHICH VITIATES CHARITABLE CHARACTER OF THE ACTIVITIES BUT IT IS THE ABSENCE O F RESTRICTIONS ON MAKING PROFITS WHICH VITIATES THE CHARITABLE CHA RACTER OF THE ACTIVITIES. IN THE INDIAN CHAMBER OF COMMERCE (SUPRA), WHICH HAS BEEN RELIED UPON BY THE ASSESSING OFFICER AND REFERRED TO IN CBDT INSTRUCTION NO. 1024 (SUPRA), I T HAS BEEN STATED THUS: ORDINARILY PROFIT MOTIVE IS A NORMAL INCIDENT OF BUSINESS ACTIVITY AND IF THE ACTIVITY OF A TRUST CONSISTS OF CARRYING ON OF A BUSINESS AND THERE ARE NO RESTR ICTIONS 8 ITA NOS. 644 TO 647(ASR)/2015 A.Y.2012-13 ON ITS MAKING PROFIT, THE COURT WOULD BE WELL JUSTI FIED IN ASSUMING IN THE ABSENCE OF SOME INDICATION TO THE CONTRARY THAT THE OBJECT OF THE TRUST INVOLVES THE CARRYING ON OF AN ACTIVITY FOR PROFIT. . THAT APART, MERE PRESENCE OF THESE TWO ITEMS DOES NOT SHOW THAT THE UNDERLYING O BJECT OF INCLUDING THESE TWO ITEMS IN THE FORMULA WAS PROFIT MAXIMISATION. THE INCLUSION FOR PROVISION FOR UNFOR ESEEN CHARGES, IN OUR UNDERSTANDING, IS A FAIR AND CONSER VATIVE APPROACH TO ENSURE THAT THE COSTS INCURRED BY THE A SSESSEE TRUST ARE RECOVERED FROM THE END BUYERS OF THE RESI DENTIAL UNITS OR LAND. THE ELEMENT OF CHARITY IS NOT IN GIVING A WAY THE RESIDENTIAL UNITS AT SUBSIDIZED OR LOW PRICES BUT I N PURSING THE OBJECT OF ADVANCEMENT OF OBJECT OF GENERAL PUBLIC U TILITY IN PLANNED DEVELOPMENT OF THE ARE IN ACCORDANCE WITH T HE POLICIES OF THE STATE GOVERNMENT. 37. A LOT OF EMPHASIS HAS BEEN MADE BY THE LEARNED DEPARTMENTAL REPRESENTATIVE ON THE FACT THAT NOTHIN G, OR VERY LITTLE, HAS BEEN DONE BY THE TRUSTS FOR THE POOR PE OPLE BUT WHAT THIS ARGUMENT OVERLOOKS IS THAT THE ASSESSEE TRUST IS NOT GRANTED REGISTRATION UNDER SECTION 2 (15) FOR IMPL EMENTING POVERTY ALLEVIATION PROGRAMS OR DOING OTHER ACTS OF CHARITY BUT IT IS GRANTED REGISTRATION BECAUSE WHAT IT IS PURSU ING, BY FOLLOWING THE STATE GOVERNMENT POLICIES FOR PLANNED DEVELOPMENT OF CITY, IS ADVANCEMENT OF AN OBJECT OF GENERAL PUBLIC UTILITY. PURSUING AN OBJECT OF GENERAL PUBLI C UTILITY DOES NOT NECESSARILY INVOLVE MORE NOTICEABLE DIRECT ACTS OF CHARITY DRIVEN BY COMPASSION AND BENEVOLENCE. THERE IS SO MUCH TO BE DONE BY THE GOVERNMENT AGENCIES, AS THESE ASSESSEE TRUSTS ARE PERCEIVED TO BE, THAT NO MATTER WHAT THESE AGEN CIES DO, THERE IS STILL LOT LEFT TO BE DONE. JUST BECAUSE TH ESE AGENCIES COULD HAVE DONE MORE, SUCH EXPECTATIONS, NO MATTER HOW LEGITIMATE, DO NOT OBLITERATE THE WORK DONE BY THES E AGENCIES AND THE ROLE PLAYED BY THESE AGENCIES FOR PUBLIC GO OD IN FURTHERANCE OF ADVANCEMENT OF OBJECTS OF GENERAL PU BLIC UTILITY. 38. LEARNED DEPARTMENTAL REPRESENTATIVE HAS ALSO PO INTED OUT THAT THE ASSESSEE TRUSTS DO NOT GET ANY GRANT F ROM THE STATE GOVERNMENT WHICH SHOWS THAT FIRST THEY MAKE P ROFITS FROM LAND DEALS AND THEN USE THE INCOME SO EARNED F OR THE PUBLIC CAUSES STATED. IT IS FOR THIS REASON, ACCORD ING TO THE LEARNED DEPARTMENTAL REPRESENTATIVE, THAT THE ASSES SEE TRUST CANNOT BE SAID TO BE ANYTHING OTHER THAN A BUSINESS 9 ITA NOS. 644 TO 647(ASR)/2015 A.Y.2012-13 SIMPLICITOR. ON THE CONTRARY, ACCORDING TO THE LEAR NED DEPARTMENTAL REPRESENTATIVE, IT IS LIKE ROBBING PET ER TO PAY PAUL. WE ARE UNABLE TO SHARE THESE PERCEPTIONS OF THE LEARNED DEPARTMENTAL REPRESENTATIVE. AN OBJECT OF GENERAL P UBLIC UTILITY DOES NOT NECESSARILY REQUIRE THAT THE ACTIVITIES OR THE BENEFICIARIES MUST BE FUNDED OR SUBSIDIZED BY THE S TATE. AS LONG AS BROADER PUBLIC CAUSE IS SERVED, WHETHER BY THE STATE FUNDING OR BY EFFICIENT REGULATION OF THE AFFAIRS, IT IS AN OBJECT OF GENERAL PUBLIC UTILITY. IT IS ALSO IMPORTANT TO BEAR IN MIND THAT COSTS OF PROPER DEVELOPMENT OF AREA ARE ALSO C OSTS INCIDENTAL TO THE PLOTS AND UNITS SOLD BY THE ASSES SEE AND, THEREFORE, THESE TWO THINGS SHOULD NOT BE SEEN IN I SOLATION. AS FOR THE SPECIFIC INSTANCE OF INORDINATE HIKE IN PRI CES WITHIN A SHORT PERIOD OF THREE AND A HALF YEARS, WE ARE UNAB LE TO COMMENT UPON THE SAME AS FULL FACTS RELATING THERET O ARE NOT ON RECORD. THAT ASPECT, HOWEVER, FOR THE DETAILED REAS ONS SET OUT ABOVE, DOES NOT AFFECT OUR CONCLUSION ANYWAY. 39. AS FOR THE DECISION OF THE COORDINATE BENCH IN THE CASE OF THE PUNJAB URBAN DEVELOPMENT AUTHORITY VS CIT [(2006) 103 TTJ 988 (CHANDIGARH)] , IT IS A CASE IN WHICH THERE IS NO MENTION ABOUT SELLING THE RESIDENTIAL UNITS AND PLO TS AT THE PRICE ON THE BASIS OF A FORMULAE LAID DOWN BY THE S TATUTE. IN THE PRESENT CASE, THERE IS NO DISPUTE ON THIS ASPEC T, AND THAT IS A CRUCIAL ASPECT HAVING BEARING ON THE CONCLUSIONS. THERE WAS ALSO NO, AND COULD NOT HAVE BEEN ANY, OCCASION TO C ONSIDER THE IMPACT, WHAT IS REFERRED TO AS KILL EFFECT, OF TH E AMENDMENTS BY THE FINANCE ACT 2015. THE REVENUE, THUS, DERIVE S NO ADVANTAGE FROM THIS JUDICIAL PRECEDENT. AS REGARDS THE DECISION OF THE COORDINATE BENCH IN THE CASE OF AMRITSAR IMPROVEMENT TRUST (SUPRA), ON WHICH SO MUCH RELIANCE HAS BEEN PLACED BY THE LEARNED DEPARTMENTAL REPRESENTATIVE, IT IS ALRE ADY SET ASIDE BY HONBLE JURISDICTIONAL HIGH COURT. AS A MA TTER OF FACT, IN THE COURSE OF PROCEEDINGS BEFORE HONBLE HIGH CO URT IN THE CASES OF OTHER IMPROVEMENT TRUSTS, LEARNED COUNSEL FOR THE REVENUE HAS FAIRLY ACCEPTED THAT THE DECISIONS OF T HE TRIBUNAL, FOLLOWING THE AFORESAID DECISION, ARE REQUIRED TO B E SENT BACK TO THE TRIBUNAL FOR FRESH DETERMINATION ON THE SCOP E OF PROVISIONS OF SECTION 2 (15). THE REVENUE, THUS, DE RIVES NO ADVANTAGE FROM THIS JUDICIAL PRECEDENT EITHER. 40. FOR THE REASONS SET OUT ABOVE, WE ARE OF THE CO NSIDERED VIEW THAT THE AUTHORITIES BELOW WERE NOT JUSTIFIED IN DECLINING THE BENEFIT OF SECTION 11 READ WITH SECTION 2(15) T O THE ASSESSEE, AND IN HOLDING THAT THE ASSESSEE TRUST WA S NOT 10 ITA NOS. 644 TO 647(ASR)/2015 A.Y.2012-13 COVERED BY ADVANCEMENT OF ANY OBJECT OF GENERAL PUB LIC UTILITY. WE, THEREFORE, DIRECT THE ASSESSING OFFICER TO DELE TE THE DISALLOWANCE OF EXEMPTION OF RS 65,20,690. THE ASSE SSE GETS THE RELIEF ACCORDINGLY. GRIEVANCES OF THE ASSESSEE ARE UPHELD. 41. IN THE RESULT, ITA NO. 496/ASR/ 2013 IS THUS AL LOWED IN THE TERMS INDICATED ABOVE. 5.6. RESPECTFULLY FOLLOWING THE ORDER OF THE HONBL E ITAT, AMRITSAR BENCH, DATED 10.09.2015 IN THE CASE OF ASSESSEE ITS ELF, I HOLD THAT THE EXEMPTION UNDER SECTIONS 11 & 12 OF THE ACT AMOUNTI NG TO RS.1,65,96,470/- IS ALLOWABLE TO THE ASSESSEE UNDER SECTIONS 11 & 12 OF THE ACT AND THE FINDING OF THE AO THAT THE ACTIVITI ES OF THE ASSESSEE TRUST ARE IN THE NATURE OF TRADE, COMMERCE AND BUSINESS I S VACATED. 5.7. IN VIEW OF THE ABOVE STATED FACTS AND IN THE C IRCUMSTANCES OF THE CASE, I AM OF THE OPINION THAT THE AO IS NOT JU STIFIED IN DENYING EXEMPTION TO THE ASSESSEE TRUST CLAIMED BY IT UNDER SECTIONS 11 & 12 OF THE ACT. THE ADDITION OF RS.1,65,96,470/- MADE BY T HE AO IN THIS CASE ON ACCOUNT OF DENIAL OF EXEMPTION CLAIMED BY THE ASSES SEE TRUST UNDER SECTIONS 11 & 12 OF THE ACT, IS THEREFORE, DIRECTED TO BE DELETED. IN THE RESULT GROUND NO. 1 OF THE APPEAL TAKEN BY THE ASSE SSEE TRUST IS DELETED. 9. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE VIEW THAT THE LD. CIT(A) HAS PASSED A WELL VERSED, DETAILED AND REASONED ORDER, WHICH DOES NOT REQUIRE ANY INTERFERENCE. IT IS NOT THE DEPARTMENTS CASE THAT THE TRIBUNAL ORDER (SUPRA) DATED 10.09.2015, WHICH HAS BEEN FOLLOWED BY THE CIT(A) AND IN OUR OPINION, CORRECTLY SO, HAS BEEN R EVERSED, OR EVEN STAYED BY THE HONBLE HIGH COURT. ACCORDINGLY, THE ORDER OF T HE LD. CIT(A) IS UPHELD AND THE APPEAL OF THE REVENUE IS DISMISSED. 10. NOW, WE TAKE UP THE APPEALS IN ITA NOS. 645, 64 6 & 647(ASR)/2015 FOR THE ASSESSMENT YEAR 2012-13 IN THE CASES OF KAPURTH ALA IMPROVEMENT TRUST, 11 ITA NOS. 644 TO 647(ASR)/2015 A.Y.2012-13 KARTARPUR IMPROVEMENT TRUST AND JALANDHAR IMPROVEM ENT TRUST. SINCE THE FACTS INVOLVED IN ALL THESE APPEALS ARE EXACTLY SIM ILAR, AS WE HAVE DECIDED HEREINABOVE, IN ITA NO.644(ASR)/2015, ( IN THE CASE OF HOSHIARPUR IMPROVEMENT TRUST, HOSHIARPUR) FOR THE A.Y. 2012-13 , OUR FINDINGS GIVEN IN ITA NO.644(ASR)/2015, SHALL APPLY MUTATIS MUTANDIS, EQU ALLY TO THESE APPEALS ALSO AND ACCORDINGLY, ALL THESE APPEALS OF THE REVENUE A RE ALSO DISMISSED. 11. IN THE RESULT, ALL THE FOUR APPEALS OF THE REVE NUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 22/06/ 20 16. SD/- SD/- (T.S. KAPOOR) (A.D. JAIN) ACCOUNTANT MEMBER JUDICIAL MEMBER /SKR/ DATED: 22/06/2016 COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEES: I) HOSHIARPUR IMPROVEMENT TRUST, HOS HIARPUR (II) KAPURTHALA IMPROVEMENT TRUST, (III) KARTARPUR IMPRO VEMENT TRUST AND IV) JALANDHAR IMPROVEMENT TRUST, JALANDHAR. 2. THE DCIT CIRCLE -1 (EXEMPTION) CHANDIGARH 3. THE CIT(A), JLR 4. THE CIT, JLR 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.