TaxTMI 
TaxTMI 
2013 (7) TMI 456
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....nts. 2. The petitioner society is registered with the Income Tax Department having Pan No. AABTN 2289D. It made an application in prescribed form for approval under section 10(23C)(vi) of the Income Tax Act for assessment year 2009-2010 onwards. The said application has been rejected by impugned order dated 31-8-2010 passed by the Chief Commissioner Income Tax, Ghaziabad on following grounds :- (A) The approval u/s. 10(23C)(vi) of the Act is available only to an educational institution existing solely for the educational purposes while the memorandum of the society stipulates other objects as well. (B) The application for exemption of the Income Tax should have been filed by the educational institution while the application in the instant case has been made by the society. (C) The aims and objects of the society provides for free education but the income and expenditure account filed along with the application shows that the institution has been charging fees and which is against the objects of the society. 3. Challenging the said order, petitioner has come up in writ petition before this court. 4. We have heard Sri Ashish Bansal, advocate for the petitioner and S....
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....ed by the petitioner society was rightly rejected as not maintainable and since the society has not been formed with the sole object of imparting education, but its memorandum of association reflects that it has other aims and objects as well and, therefore, it has rightly been denied approval u/s. 10(23C)(vi). 8. The first and foremost question which is required to be considered is whether the application for approval u/s. 10(23C)(vi) at the instance of the petitioner society was maintainable or nor and if the view taken by the prescribed authority that such application should have been filed by the educational institution itself, is legally sustainable. Before insertion of section u/s.10(23C)(vi), such cases were covered by section 10(22) which was to the following effect :- "10(22) any income of an university or other educational institution, existing solely for educational purposes and not for purposes of profit." The aforesaid provision was amended by Finance No.2 Act, 1998, w.e.f. 1-4-1999 and in its place section 10(23C)(vi) has been inserted which is as follows :- "10(23C)(vi) any university or other educational institution existing solely for educational purpos....
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....ational institution if the society was running an educational institution. We are of the view that an educational society or a trust or other similar body running an educational institution solely for educational purposes and not for the purpose of profit could be regarded as "other educational institution" coming within section 10(22) of the Act. (See CIT v. Doon Foundation - [1985] 154 ITR 208 (Cal) and Agarwal Shiksha Samiti Trust vs. CIT [1987] 168 ITR 751 (Raj). It will be rather unreal and hyper-technical to hold that the assessee-society is only a financing body and will not come within the scope of "other educational institution" as specified in section 10(22) of the Act." 10. Similar view has been taken by Delhi High Court in its judgement in Digember Jain Society For Child Welfare vs. DGIT (supra) wherein it was observed as under :- "The Supreme Court in Aditanar Educational Institution v. Additional CIT [1997] 224 ITR 310, has held that a society or a trust or other similar body running educational institutions solely for educational purposes and having the overall object of not to make any profit can be regarded as "other educational institution" even if some surp....
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....een proved by material on record that the society is not perusing any other activity apart from eduction then in such case, the society will qualify for grant of approval u/s. 10(23C)(vi) of the Act. It was observed as under :- "In the facts and circumstances, we are of the opinion that as of now the petitioner society running educational institution by the name of C.P. Vidya Niketan Inter College at Kaimganj, Distt. Farrukhabad imparts education to students from Class VI to XII, in the absence of any allegation or material, the object clause providing for other charitable activities, would not disentitle the society from approval under Section 10 (23C)(vi) of exemption. The proviso added to Section 10 (23C)(vi), specially Proviso 2, 3, 12 and 13, give sufficient powers to check the abuse of the exemption. The mere possibility, therefore, that the society may in future pursue activities, which are not charitable, or closely connected with education for making profit, would not constitute the grounds to reject the approval under Section 10 (23C)(vi)." 13. Perusal of the impugned order shows that the pleading in this regard have not been taken into consideration. Further, in th....