Revenue's appeal before the ITAT was dismissed in entirety. The Tribunal upheld CIT(A)'s deletion of various additions made by AO, including disallowance of donations, advertisement expenditure, royalty payments, depreciation on branding and curriculum development, and ad hoc disallowances on accommodation, HR, mess, and other service expenses. ITAT held that AO had proceeded on arbitrary, ad hoc assumptions without comparable data, adverse material, or specific defects in books or evidence. The hostel receipts were treated as integral to educational activities, not as a separate business, and separate books were duly maintained. As the assessee's registration under section 12AA stood restored, it was to be assessed as a charitable institution entitled to exemption under sections 11 and 12, not as an AOP.
Revenue's appeal before the ITAT was dismissed in entirety. The Tribunal upheld CIT(A)'s deletion of various additions made by AO, including disallowance of donations, advertisement expenditure, royalty payments, depreciation on branding and curriculum development, and ad hoc disallowances on accommodation, HR, mess, and other service expenses. ITAT held that AO had proceeded on arbitrary, ad hoc assumptions without comparable data, adverse material, or specific defects in books or evidence. The hostel receipts were treated as integral to educational activities, not as a separate business, and separate books were duly maintained. As the assessee's registration under section 12AA stood restored, it was to be assessed as a charitable institution entitled to exemption under sections 11 and 12, not as an AOP.
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