Law:

Section:

Section 10(29) of the Income-tax Act, 1961 - Marketing societies, income from letting of godowns - Assessment years 1970-71 and 1971-72 - Whether, assessee corporation established under warehousing corporations Act, 1962, was an authority established for marketing of commodities and was, consequently, entitled to exemption under section 10(29) in respect of income from letting out of godowns and ware housing - Held, yes Words and phrases: Phrase 'authority for marketing' as occurring in section 10(29) of the Income-tax Act, 1961. FACTS The Income-tax Officer had allowed the claim of the assessee, the State Warehousing Corporation, for exemption under section 10(29) in respect of the income from letting out of godowns and warehousing and, connected matters of agricultural produce and for transport including facilitating marking of commodities. The Additional Commissioner exercising power under section 263 disallowed the exemption on the ground that the assessee-corporation was not a marketing authority within the meaning of section 10(29). The Tribunal allowed the claim of the assessee. On reference: HELD Therefore, the assessee-corporation would be entitled to exemption under section 10(29) if three conditions are fulfilled : (i)it is an authority constituted under any law in force; (ii)it is an authority constituted for the marketing of commodities; (iii)the exemptible income must be one derived from the letting of godowns or warehouses for storage, processing or facilitating the marketing of commodities. The compelling context in section 10(29) was a limited context of the statutory authority which is constituted under the law in only a limited sphere, viz., for marketing and, therefore, if the authority so constituted had its jurisdiction and functions charged upon it by the law creating it in this limited sphere in a State, the authority so far as such limited sphere is concerned would be the authority functioning within that mandated area laid down by law under which it was created and shall be to that extent authoritative because it is created under the authority of law for exercising these enumerated functions within this mandated area laid down for its…

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