GST – Landmark judgment GST liability will be huge
GST – Landmark judgment GST liability will be huge. As SC has interpreted article 243 of COI
New Okhla Industrial Development Authority (NOIDA) is not a Municipality’ as contemplated in clause (e) of Article 243Pof Constitution; nor is it covered by definition of local authority as contained in Explanation to Section 10(20); its income is not eligible for exemption under section 10(20)
• The appellant-New Okhla Industrial Development Authority (NOIDA) was constituted under Section 3 of the U.P. Industrial Area Development Act, 1976 by notification dated 17.04.1976. The 1976 Act was enacted by State Legislature to provide for the constitution of an Authority for the development of certain areas in the State of UP into the industrial and urban township. Under the 1976Act, various functions had been entrusted to the Authorities.
• Held, that NOIDA is not covered by the word/expression of ‘Municipality’ in clause (e) of Article 243P. It is neither included in sub-clause (ii) of Explanation nor is it covered by section 10(20) except clause (ii).
• Thus, NOIDA is not a local authority; hence, is not exempted from payment of income tax under Section 10(20) and Section 10(20A) of Income Tax Act, 1961.
SUPREME COURT OF INDIA
New Okhla Industrial Development Authority
Chief Commissioner of Income-tax
A.K SIKRI AND ASHOK BHUSHAN, JJ.
CIVIL APPEAL NOS. 792,793 OF 2014
JULY 2, 2018
Though related to income tax, it can also impact Gst. So, be aware and be prepared.
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