TaxTMI 
TaxTMI 
2014 (2) TMI 670
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....mption. 4. Though the alternative claim u/s. 11 was allowed by the Hon'ble ITAT, Hyderabad in the case of St. Theresa's Convent Society, followed by in many cases including the recent decision in ITA No. 1289/Hyd/l 0 to 15 Others in Ravi Rishi Educational Society group of cases with due respect to the decision of the Hon'ble ITAT, Hyderabad and the Department has not accepted the decision of the Hon'ble ITAT and preferred appeal against the same before the Hon'ble AP. High Court. 5. The Id. CIT(A) erred in holding that the assessee is entitled to the exemption u/s 11 of the IT Act, whereas there is clear violation of the provision of 13(1)(c) r.w.s. 13(3)(a) of the IT Act. 6. In a similar issue in the case of Villages in Partnership' for the AY 2002-03, the salary paid to the members was disallowed u/s. 13(2) of the LT. Act. The decision of the learned CIT(A) to allow relief to the assessee was not accepted and the Department contested before the Hon'ble ITAT The Hon'ble ITAT, Hyderabad confirmed the said order of the Id. CIT(A) With due respect to the decision of the Hon'ble ITAT, the Department ha....
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....s, symposia and other gatherings convened for the purpose of promoting education, character building and developing the talents of the youth. 4. For the assessment year under consideration, it was noticed by the Assessing Officer from income and expenditure account that the aggregate receipt of the educational institution during this assessment year exceeded Rs. 1 core. According to the Assessing Officer the assessee is required to obtain approval from the prescribed authority u/s. 10(23C)(vi) of the Act. In the absence of this, the assessee is not entitled for exemption u/s.10(23C)(vi) of the Act though the assessee claimed alternative exemption u/s. 11, the same has been denied by the Assessing Officer and brought the excess income over expenditure to tax. Further, the Assessing Officer noticed that the assessee has paid salary to Smt. Jyoti Rao and Smt. Aparna Rao at Rs. 20,000 per month and Rs. 5,000 per month, respectively. As they are managing committee members, it attracts provisions of section 13(1C) of the Act. Further, he noticed that the assessee is not solely engaged in imparting education. It is also engaged in the business of letting out the auditorium for marriage....
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....t and also there is no mandatory approval u/s. 10(23C)(vi) of the Act. Further there was alteration in the object clause to include promotion of healthcare for which prior approval from DIT (Exemption) was not obtained. Further, he submitted that there is violation of provisions of section 13(1)(c) of the Act. Being so, exemption u/s. 11 of the Act cannot be granted. He also submitted that there is a mandatory registration required from AP Registrar of Societies and it shall be conclusive evidence with regard to alteration of Trust Deed as per section 8(a) of the AP Societies Registration Act. According to the DR there is no mention of letting out the function hall as object even in the MOA of the society. According to the DR carrying on letting out of function hall has nothing to do with the dominant and primary object of the education activity carried on by the assessee. He submitted that separate books of account of with regard to function hall were not produced by the assessee and there is violation of provisions of section 11(4A) of the Act. 8. He submitted that one of the conditions for the lease is that to run a marriage hall for 6 years to perpetuate memory of late Pinga....
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.... under AP Societies Registration Act. He submitted that the amendment was duly informed to the CIT on 12.10.2010. He submitted that the Assessing Officer is not correct in stating that mere filing of letter to the CIT and filing of a copy of resolution to the Registrar of Societies is not sufficient and amendments are not followed. According to the AR the assessee is continued with the registration u/s. 12 of the act and it has not been cancelled. Being so, exemption u/s. 11 has to be granted. Further the submitted that the asse ssee has taken an auditorium and open land on lease from ano ther charitable trust, Sri Purander Memorial Charitable Trust, which is a registered institution u/s. 12 of the Act. As per the lease deed the auditorium is being let out to general public for marriages and social functions on minimum rate of r ent. He submitted that there was an amendment to the trust deed in the year 2000 to include making of donations to institutions promoting general medical relief and medical care and this has been informed to the CIT (Exemptions) vide assessee's letter dated 12.10.2010 seeking approval for enrichment of the objects to include promotion of health care. Same c....
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....t of the conditions laid down. 13. The next objection of the Department is with regard to carrying on the business of letting out of functional hall in acommercial manner and the assessee not maintained separate books of account for this activity. As such the assessee is not entitled for exemption u/s. 11 of the Act also. There is no dispute that the assessee is carrying on the letting out of function hall on rental basis. The assessee contended before the lower authorities that the business carried on is incidental to the attainment of the objectives of the trust and the assessee has maintained separate books of account in terms of section 11(4A) of the Act. The Assessing Officer strongly opposed in his Remand Report that the assessee failed to produce separate books of account for letting out business of the assessee. However, the assessee taken a plea before the Assessing Officer vide letter dated 2.8.2011 that separate books of account are being maintained in respect of letting out and produced the same for Assessing Officer's verification and stated that provisions of section 11(4A) are complied with and cited various decisions before him contending that letting out activit....
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....e wherein the Tribunal in paras 3 and 4 observed as follows: "3. After hearing both the parties, we are of the opinion that this issue has already been decided by the tribunal vide its order dated 29.1.2009 in assessee's own case for the assessment year 2005-06 in ITA No.1120/Hyd/2009 by holding as follows: "We have heard both the parties and perused the material on record. The learned Authorized Representative for the assessee submitted that this issue covered in favour of the assessee by the order of the Hyderabad Bench 'A' of the Tribunal dated 15.4.2009 in assessee's own cases in ITA No.1133/Hy d/2006 for the assessment years 2003-04 and order dated 17.4.2009 in ITA No.1206/Hyd/2007 for the assessment year 2004-05. However, we find that the Constitutional Bench of Apex Courtin the case of T.M.A. Pai Foundations and others Vs. State of Karnataka & Others (2002) 8 SCC 481 examined the issue of collection of capitation fees for the admission of students over and above fees prescribed by the private institution and held that the institution which are collecting capitation fees for admission of students over and above the fees ....