https://www.taxtmi.com/caselaws?id=775213 ITAT Hyderabad upheld CIT(A)'s decision to delete addition made under section 11 exemption denial. The educational society operated 186 colleges and entered service contracts with related party companies. AO denied exemption alleging excessive payments under sections 13(1)(c) read with 13(2)(c), 13(2)(g) and 13(2)(h), treating payments as unreasonable under section 40A(2)(a). ITAT found AO's computation was based on suspicion without comparable evidence. The tribunal held that merely transacting with related parties doesn't automatically make payments excessive unless proven with third-party comparisons or industry benchmarks. AO failed to demonstrate services were not commensurate with payments made. Revenue's appeal was dismissed, confirming society's exemption eligibility. en-us Tue, 06 May 2025 00:00:00 +0530 Tue, 22 Jul 2025 08:25:25 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=775213 ITAT Hyderabad upheld CIT(A)'s decision to delete addition made under section 11 exemption denial. The educational society operated 186 colleges and entered service contracts with related party companies. AO denied exemption alleging excessive payments under sections 13(1)(c) read with 13(2)(c), 13(2)(g) and 13(2)(h), treating payments as unreasonable under section 40A(2)(a). ITAT found AO's computation was based on suspicion without comparable evidence. The tribunal held that merely transacting with related parties doesn't automatically make payments excessive unless proven with third-party comparisons or industry benchmarks. AO failed to demonstrate services were not commensurate with payments made. Revenue's appeal was dismissed, confirming society's exemption eligibility. Case-Laws Income Tax Tue, 06 May 2025 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=775213