M s. Krishi Utpadan Mandi Samiti, respondent assessee herein, is a Market Committee incorporated and registered under the Uttar Pradesh Krishi Utpadan Mandi Adhiniyam, 1964 1964 Adhiniyam, for short.
Under Section 16 1 of 1964 Adhiniyam, the Market Committee is under statutory obligation to enforce the provisions of 1964 Adhiniyam, the Rules and Bye laws made thereunder so as to provide such facilities for sale and purchase of specified agricultural produce, as may be specified by the Mandi Parishad from time to time.
The source of income of the assessee is in the form of receipt companylected as market fee from buyers and their agents, development cess on sale and purchase of agricultural products and licence fees from traders.
The Members of the said Market Committee companysist of producers, brokers, agriculturists, traders, companymission agents and arhatiyas.
Section 16 of 1964 Adhiniyam, inter alia, companycerns functions and duties of the Market Committee.
The question, which arises for determination in this batch of civil appeals, is as follows Whether amounts transferred by the assessee to Mandi Parishad would companystitute application of income for charitable purposes within the meaning of Section 11 1 a of the Income Tax Act, 1961?
Delay companydoned.
Leave granted.
This batch of civil appeals has been filed by the Department.
H. KAPADIA, CJI Heard learned companynsel on both sides.
The assessee carries out its activities in accordance with Section 16 of 1964 Adhiniyam under which it is required to provide facilities for sale and purchase of specified agricultural produce in the Market Area.
