Delhi High Court Grants Tax Exemption to NOIDA
The Delhi High Court overturned the CBDT's decision to deny NOIDA tax exemption for income from loans. The court ruled that NOIDA operates as a government agent for planned development and not for commercial profit. This judgment directs CBDT to process NOIDA's exemption application under section 10(46) of the Income Tax Act.
- Country:
- India
The Delhi High Court has overturned a Central Board of Direct Taxes (CBDT) order that denied tax exemption to the New Okhla Industrial Development Authority (NOIDA) for its income from loans.
A bench led by Justice Yashwant Varma ruled that the CBDT erred by categorizing NOIDA's loans and advances as commercial activities. The court directed the authority to process NOIDA's exemption request.
The court emphasized that NOIDA, set up under the Uttar Pradesh Industrial Area Development (UPIAD) Act, serves as a governmental agent for planned development, and thus, it should not be viewed as a profit-driven entity.
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