TaxTMI 
TaxTMI 
2015 (2) TMI 571
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....y, the Department collected evidence relating to collection of fees from students over and above the prescribed fees in the form of donation/capitation fees. The excess fees were collected for granting admission into the engineering courses offered by the institution of the society. The fees collected over and above prescribed fees was not accounted in the regular books of account of the society and the AO held that the same has been utilized for the benefit of the interested persons of the society. The AO had also reported about unexplained expenditure incurred by the society. The AO had referred to the statement recorded from the employee of the society, who had stated that fees for the convenor and the management quota seats is collected through bankers cheques and the capitation fees is collected in cash. The AO gathered that for AYs 2005-06, 2006-07, 2009-10 & 2010-11, the total unaccounted receipts amounted to Rs. 16,62,26,000/-. The AO had also reported that certain investments were made from out of donation/capitation fees collected from the students and were not recorded in the books of the society. The AO was of the view that due to the violations of the provisions of sec....
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.... provisions of section 132(4A) of the Act, the CIT held that presumption can be drawn that the documents found from the premises of the Society are true and it belongs to the society and the society has to explain it and mention as to who has prepared the documents. He further held that during the course of search statement of Sri M. Ramesh Babu, an employee of the society was recorded and he had stated that fees for capitation fees is collected in cash and for the rest of the course the fees is collected in the form of Banker cheques/DDs. It was also recorded on the date of search that cash donations received for management seats are used to clear the expenses in cash and also the balance amounts are deposited in the personal account of Shri K.T. Mahi in Andhra Bank. From here the cash deposited will be transferred into various school's accounts as per requirements. The CIT observed that Sri K.T. Mahi admitted the sum of Rs. 16.5 lakhs as additional income in his individual hands. The CIT was of the view that the collection of money by the trustee or the employees of the society have a direct relationship with the trust itself and the misdemeanor by the trustee and the employees i....
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....y Vs. CIT [2010] 44 DTR 97, (Lucknow Tribunal) 8. The second argument of the learned counsel for the assessee is that the amounts said to have been collected and added to the income of the assessee was actually owned up Shri K.T. Mahi, who happens to be the Secretary of the Society and the said amount was also assessed in his personal hands. A similar addition was also made in the assessment of the society. It is submitted that the amount said to have been collected was never its own income, it never reached the society and it had nothing to do with it and as such, the society has done no violation of any law including any provisions of the IT Act. It is submitted that if there was any impropriety done, it was done by Shri Mahi in his individual capacity and not by the society. It is also submitted that since the said amounts never reached the society in the first place there was no violation of section 13 of the Act nor was there any reason to cancel registration u/s 12AA of the Act. 9. The third argument of the learned counsel is that even if there is violation of section 13, it can only result in the assessing office making an addition in the year of violation but it canno....
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....34 TTJ (Ahd) 483, the Ahmedabad Bench held that "amendment of subsection (3) of s. 12AA w.e.f. 1st June, 2010 should not be applicable retrospectively and its operation has to be effective from the date it was introduced and onwards and therefore CIT was not justified in cancelling the registration granted to assessee u/s 12A, by invoking provisions of section 12AA(3); further, the trust being an educational institution and undisputedly imparting education, cancellation of registration was not in accordance with law." The same ratio has been followed by the Lucknow Bench of ITAT in the case of Kapoor Educational Society Vs. CIT, [2010] 134 TTJ (Lucknow) 250. 13. Further, we are of the opinion that Shri K.T. Mahi seems to have collected capitation fees on his own without any authority of the society, therefore, the society is not involved in collection of capitation fees in cash. The argument of the learned DR that the acts of the servant will bind the master cannot be applied to the facts of the present case for the reason that Shri K.T. Mahi was never authorized to collect the excess capitation fees. The authority to collect the excess fees should have been given by the society....