Rs102 crore tax relief for Gujarat Maritime Board

The Gujarat Maritime Board (GMB) has got relief from paying Rs102 crore towards income tax as Income Tax Appellate Tribunal allowed its status as a charitable trust.

The income tax commissioner of Gandhinagar had cancelled the board's license as a charitable organisation following modifications in Finance Act in December 2010.

The I-T commissioner had observed that the board collects fees for providing facilities such as port infrastructure, marine service, clearing and forwarding, storage area and also gives land on rent to users of sea ports.

The board deposits these fees with the state government. The I-T department termed it as professional activity as the board charges fees from the users.

As per section 2(15) of Income Tax Act, the charitable organisation's income should not exceed Rs10 lakh. However, the board's income was much higher. So the income tax department had cancelled the board's certificate as a 'charitable organisation'.

However, the GMB approached Income Tax Appellate Tribunal and cited orders given in favour of Gujarat Industrial Security Force and Ahmedabad Urban Development Authority (AUDA).

The tribunal accepted the claims of the GMB and granted it status of a 'charitable organisation'. As a result, the GMB will be exempted from Rs102 crore tax.