In Brief
This appeal concerned whether the Vidarbh Irrigation Development Corporation qualified as a local authority exempt from income tax under Section 10(20A) of the Income Tax Act, 1961. That section exempts from tax income of authorities constituted by law for housing accommodation or for planning, development or improvement of cities, towns and villages. The High Court had remanded the matter to the Income Tax Appellate Tribunal for fresh consideration in light of the VIDC Act, 1997, Maharashtra Irrigation Act, 1976, and Bombay Canal Rules, 1934. The Supreme Court upheld the High Court's remand order and dismissed the department's appeal, finding no basis to interfere with the appellate process.
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