Chandra Poojari Accountant Member. - This appeal by the assessee is directed against the order of CIT-II, Jalandhar, dated 29-9-2008 for the assessment year 2008-09.

2. The assessee has raised following grounds :

"1. That the CIT, Jalandhar-II, was not justified in not granting the registration under section 12A to the appellant trust.

2. That the CIT failed to appreciate that it is well settled law that registration has to be granted to the trust where the objects of the trust are charitable in nature.

3. That the CIT has exceeded his jurisdiction by applying presumptions and assumptions on the application of the proposed income of the trust.

4. That the CIT failed to appreciate that objects of the trust are charitable in nature as envisaged in section 2(15) of the Income-tax Act and therefore, registration ought to have been granted.

5. That the order of the CIT is against the law and facts of the case."

3. The brief facts of the case are that the assessee filed an application in Form No. 10A on 28-3-2008 for seeking registration under section 12A(a) of the Income-tax Act, 1961. The Jalandhar Development Authority is an authority brought into existence by the order of the Government of Punjab, Department of Housing and Urban Development vide its Notification No. 13/31/2004-1HG2/5370, dated 16-7-2007. As per notification that all the powers and functions of the PUDA relating to development and redevelopment of the area shall be exercised by the JDA as constituted. The JDA was constituted under section 28(1) of the Punjab Regional and Town Planning and Development Act, 1995. The object of the authority is as follows :—

"The objects of the authority shall be to promote and secure better planning and development of any area of the State and for that purpose the authority shall have the powers to acquire by way of purchase transfer, exchange or gift or to hold, manage, plan, develop and mortgage of otherwise dispose of land or other property or to carry out itself or in collaboration with any other agency or through any other agency on its behalf, building, engineering, mining and other operations to execute works in connection with supply of water, disposal of sewerage, control of pollution and other services and amenities and generally to do any thing with the prior approval or on direction of the State Government, for carrying out the purposes of the Act."

According to the assessee, the objects of the society falls under the purview of section 2(15) of the Income-tax Act, 1961. According to learned CIT, the assessee has generated income by way of disposing off the developed lands and the lands are sold with definite motive of profit and there is no charitable purpose or any activity for public utility which is the primary requirement of section 2(15). The learned CIT was of the opinion that the activities of the assessee are aimed at earning profit. He further relied on the judgment of Hon’ble Supreme Court in the case of Indian Chamber of Commerce v. CIT [1975] 101 ITR 796 and observed that the assessee cannot be said to be engaged in general public utility and it is carrying on activity in the nature of trade, commerce or business. Further, the learned CIT(A) observed that the assessee is not a trust or an institution and it is a local body and as such denied registration under section 12A of the Income-tax Act. Further, the learned CIT observed that in the case of the assessee there is no voluntary contributions received by the assessee and from this angle he refused to grant registration under section 12A of the Act. Hence, the assessee is in appeal before us. All the grounds are inter-related, hence we are adjudicating the grounds in its entirety, and not ground by ground.

4. The learned counsel for the assessee submitted that the assessee trust was constituted vide notification of Government of Punjab, dated 16-7-2007 with an object of carrying out all functions of PUDA relating to development, redevelopment of areas to be e