AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2015 (2) TMI 1030
X X X X Extracts X X X X
X X X X Extracts X X X X
....ng only coaching classes for students to enable them for the purpose of appearing in civil services examination does not come under the purview of education as defined in Section 2(15) of the IT Act, 1961. 4. The Ld. CIT(Appeals) ought to have appreciated that the activity of coaching conducted by the assessee to enable students for appearing in competitive examination does not come under the ambit of education, having regard to the decision of Hon'ble Patna High Court in Bihar Institute of Mining & Mine Surveying Vs. CIT (1994) 208 ITR 608, and hence the assessee is not entitled to exemption u/s.10(23C)(iiiad) of the IT Act, 1961. 5. The Ld. CIT(Appeals) erred in law in holding that the net income is to be taxed when the gross receipts from fee collection, in the hands of the assessee, which constitutes its total income is taxable, as it is not entitled for exemption for the grounds of appeal raised above. 6. The Ld. CIT(Appeals) is not justified in deleting the disallowance of depreciation, when the assessee has debited a sum of Rs. 3,64,941 in the Income & Expenditure Account and its income is not eligible for exemption u/s.10(23C)(iiiad) of the IT Act, 1961. 7. Any othe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ision of the Hon'ble Supreme Court in the case of Sole Trustee, Loka Shikshana Trust vs. CIT 101 ITR 234 and some other decisions of the Supreme Court as well as other High Courts. Accordingly, the A.O. held that the total fees collected of Rs. 17,28,070 from the students appearing for competitive examination is required to be brought to tax and treated it as income of the assessee for the impugned assessment year. 4. Being aggrieved of the addition made by the A.O. assessee preferred appeal before the Ld. CIT(A). In course of hearing of appeal before the First Appellate Authority, it was submitted by the assessee that the word 'Education' had not been defined in the Act, hence, should not be restricted to mere conventional or academic education. It was submitted, 'Education' includes vocational Education and training also. Assessee submitted, even as per the ratio laid down by the Hon'ble Supreme Court in the case of Sole Trustee, Loka Shikshana Trust vs. CIT (supra), the word 'Education' cannot be given a restrictive meaning. In support of such contention, assessee relied on number of decisions. Further, it was submitted by the assessee that as as....
X X X X Extracts X X X X
X X X X Extracts X X X X
....furnace and stone crushing activities, which made them self reliant, was considered as an educational activity. In the case of Gujarat State Co-op Union Vs. CIT [1992] 195 ITR 279 (Guj), an institution conducting Diploma Certificate and Orientation Courses in Cooperation and Banking was found by the Court to be eligible for exemption as an educational institution. Similarly, in the case of CIT Vs. Sri Ram Educational Foundation [2001] 250 ITR 504 (Del), a vocational training centre was considered as an educational institution, by placing reliance on the decision in the case of Addl. CIT Vs. Surat Art Silk cloth Manufacturers Association [1980] 121 ITR 1 (SC). 4.7. There is no dispute that the appellant is engaged in providing training and skills focused at enabling its 'students' to obtain jobs through cometitive examinations. The appellant is also doing it in a systematic and structured manner. Award of formal degrees or certificates at the culmination of the Training Programme is not a mandatory requirement for qualifying as 'education'. 4.8. I, therefore, hold that the activities of the appellant fall in the realm of 'education' as a result of which the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....13. ITO vs. SRM Foundation of India (1988) 30 TTJ 283 (ITAT) (Del.) 14. Spectra Shares & Scrips P. Ltd., vs. CIT (2013) 354 ITR 35 (A.P.) 15. CIT vs. Hindusthan Motors Ltd., (1991) 192 ITR 619 (Cal.) 16. CIT vs. Dalmia Dadri Cement Ltd., (1970) 77 ITR 410 (P & H). 17. DDIT (E)-I, Hyderabad vs. Kamineni Educational Society, Hyderabad ITAT, Hyderabad 'B' Bench ITA.No. 807 to 809/Hyd/2010 dated 03.09.2010. 6.1. Learned A.R. submitted, for that matter, assessee is also conducting MCA course. Learned A.R. further submitted that even otherwise also the objects of the assessee having been found to be of charitable nature, the assessee has been granted registration under section 12A of the Act from the date of its establishment which proves the fact that assessee is a charitable institution existing for charitable purpose as defined under section 2(15) of the Act. Therefore, till such registration continues and assessee carries on activities as per its objects, the A.O. cannot treat the assessee not to be a charitable institution. Further, the learned A.R. submitted that from the date of its inception, assessee has been granted exemption as a charitable institution in precedin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....iteracy activities. h. To establish, maintain, run, develop, improve, extend, grant donate, for and to aid in the establishment, maintenance, improvement and extension of Schools, colleges, polytechnics and other educational institutions, including Vocational training centers, research centers, foundations and adult education Centers and hostels for students. 8. The A.O. while examining the books of accounts and other information available on record has not found any material to suggest that assessee has undertaken activities contrary to its aims and objects. The only reason on which the A.O. has come to conclusion that it is not eligible for exemption under section 10(23C)(iiiad) is that since the assessee is engaged in coaching students for competitive examination, the said activity does not partake the nature of imparting education. Hence, is not within the meaning of charitable purpose under section 2(15) of the Act. The A.O. has also observed that assessee cannot be classified as charitable institution for that very reason. However, on examination of the definition 'charitable purpose', it is clear that education is one of the activity coming within the meaning of ch....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e case of Radhasoami Satsang (193 ITR 321) where a fundamental aspect permeating through the different assessment years has been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order it would not at all be appropriate to allow the position to change in a subsequent year. The Hon'ble jurisdictional High Court while following the aforecited principle laid down by the Hon'ble Supreme Court in case of Spectra Shares and Scrips vs. CIT (supra) held as under: "In view of the above, we hold that the respondent cannot under section 263 interfere on an issue which has been accepted by the Revenue for a number of years particularly, when the A.O. in the assessment order for the A.Y. 2006-07 takes the same view by terming it erroneous" 8.1. Though the same view has been expressed in other decisions referred to by the learned A.R. it is not necessary to refer to all of them as the principle in this regard is a well known. At this juncture, it will be pertinent to mention here that in A.Y. 2004-05 also while completing the assessment under section 143(3), the A.O. had accepted assessee's claim of exemption. Subsequ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rder of Ld. CIT(A). Grounds No. 2, 3, and 4 of the department are dismissed. 9. Ground No.5 is with regard to finding of the Ld. CIT(A) that only the net income is to be taxed. Having heard the parties though we agree in principle with the observations made by the Ld. CIT(A) but since it is purely of academic interest, there is no need to adjudicate this ground. Accordingly, ground No.5 of the department is dismissed. 10. Ground No.6 is with regard to CIT(A) deleting the addition made on account of disallowance of depreciation. While completing the assessment, the A.O. disallowed depreciation of Rs. 3,63,962 by observing that depreciation is not allowable for a capital asset whose entire cost of acquisition is either written off in the first year itself or the cost of acquisition is treated as application of income. Ld. CIT(A) deleted the addition by observing as under: "7.0 The eighth ground of appeal relates to the appellant's claim of depreciation. The AR, while agreeing in principle that depreciation is not allowable on capital assets the entire cost of acquisition of which has either been written off or been treated as application of income, has submitted that the appel....