TaxTMI 
TaxTMI 
2015 (9) TMI 232
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.... also registered under Section 12-AA and was granted exemption certificate under Section 80-G of the Income Tax Act. Petitioner has applied on the prescribed form no. 56-D on 30.09.2013 for grant of approval under section 10(23-C)(VI). Application, so moved by the petitioner, was rejected vide order dated 23.09.2014 on the ground that petitioner has other objects apart from imparting education and petitioner has disproportionate fee structure as to maximum fee simply to invest for expansion of the institution which may not fall into the ambit of charitable activity; petitioner has spent huge amount of Rs. 39,00,000/- odd on advertisement; case seems to be covered by the judgment of this Court passed in the case of M/S Queen's Educationa....
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....ch institutions be looked at carefully. If they are not genuine, or are not being carried out in accordance with all or any of the conditions subject to which approval has been given, such approval and exemption must forthwith be withdrawn." Hon'ble Apex Court in the case of CIT v. Surat Art Silk Cloth Manufacturers' Assn. [(1980) 2 SCC 31 , has held as under: "that test of predominant object of the activity is to be seen whether it exists solely for education and not to earn profit. However, the purpose would not lose its character merely because some profit arises from the activity. That, it is not possible to carry on educational activity in such a way that the expenditure exactly balances the income and there is no r....
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...., the objects and the powers of the concerned entity." The Hon'ble Apex Court in the case of American Hotel & lodging Association Educational Institute v. CBDT [2008] 10 SCC 509 , has held as under: 38. In deciding the character of the recipient, it is not necessary to look at the profits of each year, but to consider the nature of the activities undertaken in India. If the Indian activity has no co-relation to education, exemption has to be denied, [judgment of this Court in Oxford University Press (supra)]. Therefore, the character of the recipient of income must have character of educational institution in India to be ascertained from the nature of the activities. If after meeting expenditure, surplus remains incidentally....
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....ial approval. 51. For the sake of clarity, we may reiterate that items such as application of income or accumulation of income or investment in specified assets indicated in clauses (a) and (b) in the third proviso are a part of compliance/monitoring conditions. As stated, however, there is a difference between application/utilization of income and outward remittance of income out of India. As discussed above, with the insertion of the provisos in section 10(23C)(vi) of the 1961 Act, it is open to the prescribed authority (PA) to stipulate, while granting approval, that the approval is being given subject to utilization/application of certain percentage of income, in the accounting sense, towards impartation of education in India. ....