TaxTMI 
TaxTMI 
2015 (2) TMI 449
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....enefit of the public at large and were also not of charitable nature. 3. Re: Deduction of Expenses: 3.1 That, on the facts and in the circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) erred in upholding the action of the Assessing Officer in not reducing the expenses incurred by the appellant by way of amortization of premium on investments and purchase of fixed assets. 4. Re: Other Statutory Deductions: 4.1 That, on the facts and in the circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) erred in upholding the action of the Assessing Officer in not granting the statutory deductions on account of amount set aside by appellant for future requirements to the extent of Rs. 34,573,450 (150/c of Income) and on account of and on account of the sum of Rs. 23,599,690 accumulated by the appellant for specified purposes in conformity with the provisions of Section 11(2).  ....
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....e ITAT and the coordinate Bench of the ITAT at Mumbai decided the matter in favour of the assessee. Against this order of the ITAT, Department has preferred appeals u/s 260A before the Hon'ble Bombay High Court. These appeals, though admitted are still lying pending. We find that in the subsequent period, i.e. assessment years 1999-2000 to 2001-02, the assessee has applied to the Central Board of Direct Taxes for approval of Notification u/s 10(23C)(vi). It was informed that no communication has been received from the Board. However, drawing inferences from the letter addressed by the D.G. (Exemption), Calcutta dated 28.05.2002 to the assessee, wherein the D.G. has remarked as under: "As the activities of your organization are not solely for educational purposes and does not serve the of interest of public at large. Your case is reported to be unfit for Notification u/s. 10(23C)(vi) of the Income Tax Act, 1961". To arriving at above conclusion, the following observations have been made: (i) The Institute has generated huge surplus; (ii) The Institute is not open to public at large; 5. Meanwhile, the assessee has now made an application for Exemption u/s 10(23C)(vi) of ....
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....detailed submissions filed by it before the CIT(A), wherein specific reference were made in paragraphs (APB 22 to 29). The AR also placed reliance on the following decisions: City Montessori School vs UOI, reported in 315 ITR 48 (All); DIT (E) vs Ahmedabad Management Association, Order dated 13.06.2014, by the Hon'ble Gujarat High Court, ITA No. 707 of 2013; DIT vs Samudra Institute of Meritime Studies Trust, reported in (2014) 49 Taxman.com 510 (Bom) (Copies enclosed), wherein the ration has been laid that the associations had been running educational institutions and having educational activity. 13. The primary reason for denial of exemption u/s 11 are, that the Institute has generated huge surplus and the Institute is not open to public at large. 14. The Memorandum of Association when read out, we find that the Institute had been brought up only for the purpose of development of baking personnel for/in the banking industry. The institute imparts education to the candidates who are connected with the banking industry. It has library facility, organizes lectures, seminars and undertake examinations for promoting bank officers. 15. In so far as its investments are concerned it w....
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....ng; (c) Diploma in Financial Services; (d) Diploma in Bank Management; (e) Certificate in banking Oriented paper in Hindi; (f) Certificate Examination for the employees of Unit Trust of India. 15. A detailed list of the assessee's activities is found in the records, which was placed before the revenue authorities as well as us. 16. For advancement in banking industry, the number of students enrolling for various courses offered by the Institute increased steadily over the years, thereby reflecting the growing popularity of the Institute's courses in the banking arena. The list of the various courses offered by the Institute is on record. 17. Reverting our attention to the reasoning given by the revenue authorities, that the assessee was generating huge surplus, it was submitted that as per section 11 of the Act the assessee could spend 85% of its income towards charitable objects. It was submitted that if there was a surplus, it could be legally accumulated under section 11(2) of the Act. The AR submitted that the assessee has always complied with the said requirement in each of the years. The accumulation of the corpus, if any, has been spent in accordance with the provisio....