TaxTMI 
TaxTMI 
2014 (12) TMI 798
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.... hence the assessment order passed on the assessee be cancelled. 3. For that in the facts and circumstances of the case the assessee cannot be assessed to tax merely because it filed a return of income though it was not a taxable entity." Second common issue raised by assessee in these appeals is, that, whether assessee is entitled to exemption u/s 10(23C)(iiiab) of the Act or not. For this assessee raised following ground no 4: "4. Without prejudice to above and in the facts and circumstances of the case the assessee be entitled to exemption u/s. 10(23C)(iiiab) of the IT Act 1961 and accordingly the entire income of the assessee be held to be exempt u/s 10(23C)(iiiab) of the IT Act 1961." 3. Brief facts relating to above two inter connected issues are that the assessee is an educational institute, which does not exist for profit. The AO in assessment order noted the fact that it is a theological university established to promote piety and learning, particularly among the native Christian population of India. The Serampore College is a university incorporated by the Royal Charter of 1818. The Serampore College was granted power to grant degree, diploma and certificate in any br....
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....ata-X asked for report from the AO and the AO after examine the audited accounts for the FY 2003-04 to 2008-09, forwarded its finding to CCIT Kolkata-X on 05-10-2010. In view of the report of AO, CCIT Kolkata-X rejected the application of the assessee, 'Senate of Serampore College' vide his order No.CCITX/ 10(23C)/2/2010-11/1910-14 dated 25-11-2010. Thereafter the AO issued notice u/s 148 of the Act dated 01-02-2011 for the AYs 2009-10, 2010-11, 2006-07 and 2004-05, for the reason that in each of the year there is excess of income over expenditure as per the audited Income and Expenditure account. In the present year, the assessee's excess of income over expenditure as per audited Income and Expenditure of account was to the tune of Rs. 64,39,213/-. According to AO, even the exemption application u/s 10(23C)(Via) of the Act was also rejected by the CCIT Kolkata-X vide order dated 25-11-2010. Before the AO during the course of assessment proceedings the assessee filed detailed written submissions, which are reproduced in the assessment order, claiming that 'Senate of Serampore College' is only a unit of college and the legal entity should be, 'The Serampore College'. It was pleaded ....
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....liable to be assessed to tax. He further submitted that on consolidation of the income & expenditure accounts of the four Units of Serampore College for the relevant financial year it would be evident that more than 53% of the gross income was financed by the Government of India as per UGC norms for educational purposes discharged by the four Units of Serampore College for their activities and projects and, therefore, the college including the appellant is covered by sec.10(23C)(iiiab) of the Act and thus eligible for blanket exemption. In support of the submissions, reliance was placed on some of the judicial pronouncements which are mentioned in the written compilation extracted above. 7. I have heard the Ld. A/R, gone through the written submission and perused the assessment order as well as details available on record. There is no dispute to the fact that the appellant applied to the Ld. C.C.I.T., Kolkata-X, Kolkata on 11/11/2009 for grant of exemption u/s. 10(23C)(via) of the Act for assessment years 2007-08 to 2009-10. The Ld. C.C.I.T., called for a report from the AO and after considering the application of the appellant and examining the report of the AO including the audi....
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....d in ignorance of law surrendered to the jurisdiction of the assessing authority and/or filed return of income. It is not in dispute that the appellant (Senate of Serampore College) is a very old institution and accounts are being audited regularly. The appellant is not an individual or layman, rather the institution is run and guided by a body or council. Therefore, the stand of the appellant on ignorance of law is not consumable on the facts and circumstances of the case. Moreover, the appellant before the AO has made a submission (para-5 of the assessment order) for exemption u/s. 10(23C)(iiiab) of the Act that Senate of Serampore College (Unit II) is unaided by Government, whereas as per subclause (iiiab) reproduced above, any university or other educational institution amongst other criteria shall be wholly or substantially financed by the Government. In this connection, I find substantial basis and force in the action of the AO in assessing the appellant as an independent entity inasmuch as it has filed its return as an independent entity showing its own income and expenditure. Therefore, in my considered opinion, the appellant is not even coming under the purview of sub-clau....
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.... In our view, 'The Serampore College' - the entity, as per Serampore College Act 1918, exists for nearly two centuries as an educational institution catering to theological and general education. The college imparts formal education on different streams and subjects for public at large. Even religions or philosophical educations through formal systems of course, curricula, examination and awarding degrees is also education for the purpose of section 2(15) or 10(23C) of the Act. In view of the facts and circumstances of the case as discussed above, we are of the view that each unit maintains separate accounts of its receipts and payments and Income-Expenditure and is duly audited by Chartered Accountant. The Arts, Science and Commerce departments of the Serampore College is approved by the UGC and funded by Govt. like all other colleges under the University of Calcutta. It is a fact that accounts of these 4 units of "The Serampore College" are separately audited, and a consolidated financial statement is prepared and looked into for the purpose of taxation under the provisions of the Act considering 'The Serampore College' as one and sole taxable entity. Hence we hold that "The Sera....