CBDT Notifies Income Tax Exemption u/s 10(46) for Urban Improvement Trust of Udaipur [Read Notification]

The Central Board of Direct Taxes (CBDT) vide notification S.O. 3666(E) issued on 16th August 2023 has notified the income tax exemption for the Urban Improvement Trust of Udaipur under Section 10(46) of the Income Tax Act, 1960. It was also certified that no person is being adversely affected by giving retrospective effect to this notification.

By virtue of the authority granted under clause (46) of section 10 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby issues a notification for the purpose of the mentioned clause. The notification pertains to ‘Urban Improvement Trust Udaipur, which is a Trust established by the State Government of Rajasthan. It pertains to the specific income generated by the mentioned Trust namely:

• Grants received from the State Government;
• Moneys received from the disposal of land, building and other properties;
• Moneys received by way of rent/lease of land, building and other properties;
• Moneys received by way of fees, interest or any other charges received under the Rajasthan Urban Improvement Trust Act, 1959;
• Interest earned on (a) to (d) above; and
• Interest on Loans received from the State Government.

However, the provisions of this notification shall be effective subject to the conditions that the Urban Improvement Trust Udaipur,-

• shall not engage in any commercial activity;
• activities and the nature of the specified income shall remain unchanged throughout the financial years; and
• shall file return of income in accordance with the provision of clause (g) of sub-section (4C) of section 139 of the Income-tax Act, 1961.

It was also notified that this notification shall be deemed to have been applied for the assessment years 2013-2014, 2014-2015, 2015- 2016, 2016-2017 and 2017-2018 relevant to the financial years 2012-2013, 2013-2014, 2014-2015, 2015-2016 and 2016-2017 respectively.

The notification’s explanatory memorandum adds that “This notification shall be given retrospective effect for the assessment years 2013-2014 to 2017-18 relevant to the financial years 2012-2013 to 2016-2017, respectively, in view of the Order of the Hon’ble High Court of Judicature for Rajasthan at Jodhpur in matter of Urban Improvement Trust, Udaipur V. Union of India and Anr. in [D.B. Writ Petition (Civil) No.1004 of 2016], dated 21st of April, 2023.”

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