TaxTMI 
TaxTMI 
2007 (9) TMI 347
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.... 2006, of the Income-tax Appellate Tribunal, Delhi Bench 'B', New Delhi (for short, "the ITAT") passed in I. T. A. Nos. 2191 and 2189 (Delhi) of 2004 pertaining to the assessment years 2000-01 arid 2001-02, whereas Appeal No. 104 of 2007 has been preferred by the Revenue against the judgment dated July 7, 2006, passed by the Income-tax Appellate Tribunal in Appeal No. 2190 (Delhi) of 2004 pertaining to the assessment year 2001-02. 2. The facts, in brief, are that the assessees are educational societies registered under the Societies Registration Act and have been imparting education to children. In the relevant assessment years the assessees in both the appeals claimed exemption under section l0(23C)(iiiad), which provides that the....
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....t has come up in appeal before us. 5. We have heard learned counsel for, the parties and perused the record. 6. The following question arises before this court for consideration : "Whether, in the facts and circumstances of the case, exemption as claimed by the assessees was allowable or not ?" 7. The Income-tax Appellate Tribunal, while granting exemption under section 10(23C) (iiiad), recorded the following reasons : "During the years relevant for the assessment years 2000-01 and 2001-02, the excess of income over expenditure stood at Rs. 6,58,862 and Rs. 7,82,632, respectively. It was also noticed that the appellant-society had made investment in fixed assets including building at Rs. 9,52,010 in the financial year 1999-20....
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.... all times and without necessary equipment and without paying to the staff engaged in imparting education. The assessee is not getting any financial aid/assistance from the Government or other philanthropic agency and, therefore, to achieve the objectives, it has to raise its own funds. But such surplus would not come within the ambit of denying exemption under section 10(23C)(iiiad) of the Act." 8. The reasons recorded by the Income-tax Appellate Tribunal are hypothetical and against the set up case of the Revenue relating to earned profit. The Income-tax Appellate Tribunal failed to appreciate the profit of 30 per cent. in the assessment year 2000-01 and 27 per cent. in the assessment year 2001-02 of the total receipts in the case of Q....
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....bject of providing education and earning profit. Further, with profit earned the society has strengthened or enhanced its capacity to earn more rather than to undertake any other activities to fulfil other noble objects for the cause of poor and needy people or advancement of religious purpose. 10. Therefore., the law laid down by the apex court has rightly been applied and exemption has also rightly been refused by the Assessing Officer in the facts and circumstances of the case. 11. Further, as noticed by the Income-tax Appellate Tribunal in the case of Queens' Educational Society that it had made investment in fixed assets including building at Rs. 9,52,010 in the financial year 1999-2000 and Rs. 8,47,742 in the financial year 2000....