https://www.taxtmi.com/caselaws?id=312831 The Allahabad HC upheld the Commissioner's rejection of exemption u/s 10(23C)(vi) for a society operating an educational institution. The court found that despite running the institution for educational purposes, the society was diverting profits to members through artificially inflated interest payments on unsecured loans. Interest rates were progressively increased from 12% to 21% across assessment years 2005-07 to match rising income, demonstrating profit motive rather than non-profit purpose. The society's bye-laws initially contained no provision for interest-bearing loans, with amendments made only during 2006-07. The HC concluded the society was not genuinely operating as a non-profit institution, affirming the exemption denial. en-us Fri, 18 Dec 2015 00:00:00 +0530 Mon, 11 Mar 2024 15:19:53 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=312831 The Allahabad HC upheld the Commissioner's rejection of exemption u/s 10(23C)(vi) for a society operating an educational institution. The court found that despite running the institution for educational purposes, the society was diverting profits to members through artificially inflated interest payments on unsecured loans. Interest rates were progressively increased from 12% to 21% across assessment years 2005-07 to match rising income, demonstrating profit motive rather than non-profit purpose. The society's bye-laws initially contained no provision for interest-bearing loans, with amendments made only during 2006-07. The HC concluded the society was not genuinely operating as a non-profit institution, affirming the exemption denial. Case-Laws Income Tax Fri, 18 Dec 2015 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=312831