TaxTMI 
TaxTMI 
2012 (4) TMI 635
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....eals concerning six educational institutions. Since common issues are involved, all these appeals are being disposed off with this consolidated order for the same of convenience. REVENUE'S APPEALS CONCERNING SRI VENKATA SAI EDUCATIONAL SOCIETY, HYDERABAD: ITA No.1440/Hyd/2011 Assessment year 2003-04 ITA No.1441/Hyd/2011 Assessment year 2003-04 ITA No.1442/Hyd/2011 Assessment year 2003-04 2. Let us first take up for consideration the appeals concerning Sri Venkata Sai Educational Society, which are directed against common order of the CIT(A)-I, Hyderabad dated 8.6.2011 for the assessment years 2003- 04, 2004-05 and 2006-07. 3. Though common issues are involved in these three appeals, assessee raised elaborate grounds in the appeal for assessment year 2003- 04, whereas common concise grounds in the appeals for the assessment years 2004-05 and 2006-07, and as such, we prefer to reproduce hereunder, the grounds taken in the appeal for the assessment year 2004- 05, which read as under- "1. Whether the CIT(A) erred in appreciating the fact that obtaining approval of the prescribed authority is mandatory as per the plain meaning of the provisions of....
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....s Vs. State of Karnataka & Others (2002) 8 SCC 481 examined the issue of collection of capitation fees for the admission of students over and above fees prescribed by the private institution and held that the institution which are collecting capitation fees for admission of students over and above the fees prescribed cannot be construed as charitable/education institution. Apex Court further observed that the fees collected over and above the prescribed fee for admission of the student has to be constructed as capitation fee. The Apex Court, further observed that the concerned university and regulated body has to take action for withdrawal of the recognition in case it is found that the educational institution received any money over and above the fees prescribed for the courses. Same view was taken by Apex Court in the case of Islamic Academy of Education and another Vs. State of Karnataka & another (2003) 6 SCC 697. If the donations were received compulsorily for admission of students, the assessee is not entitled for exemption either u/s 10(23C) or u/s 11 of the IT Act. Since the lower authorities have not examined the collection of capitation fees in this case, in our opinion, ....
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.... Tribunal is not supposed to make out a third case arbitrarily. We have carefully gone through this judgment. This judgment is delivered in the context, wherein the issue is whether the sale transactions were genuine or not and not relating to the quantum of sale price. However, the Tribunal on appeal reduced the sale price to half of the amount claimed by the assessee, instead of deciding on the genuineness of the transaction, without any documentary evidence. In that circumstance, the Hon'ble High Court has held as above. In the present case, the issue is relating to allowability of exemption under S.11 or under S.10(23C), and while adjudicating on this issue one has to see the eligibility of claiming of deduction under S.11. This aspect has not been proper addressed by the CIT(A) while granting the alternative claim of the assessee for exemption under S.11. Since the Assessing Officer has no occasion to examine the claim of the assessee under S.11, we have given suitable directions, in the preceding para, to the Assessing Officer for verification. That being so, the ratio laid down by the jurisdictional High Court in the case noted above, has no application to the facts of the p....
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....ct allowed under S.11, and if it was so allowed, the depreciation would not be allowed in respect of such asset. Only if the value of the asset was not allowed as expenditure under S.11, the Assessing Officer is required to allow depreciation thereon, as per the rate applicable to those assets, as held in the case of Mahila Sidh Nirman Yojna, cited supra. This issue raised by the Revenue is set aside to the file of the Assessing Officer for fresh consideration, in the light of the above observations. The Assessing Officer shall accordingly redecide the issue in accordance with law and after giving reasonable opportunity of hearing to the assessee. 8. In the result, Revenue's appeals are allowed for statistical purposes. Revenue's appeal concerning KMR Educational Society: ITA No.1418/Hyd/2011 Assessment year 2009-10 9. Now, we may take up the Revenue's appeal, ITA No.1418/Hyd/2011, concerning KMR Educational Society, which is directed against the order fo the CIT(A)-I, Hyderabad dated 16.5.2011 for the assessment year 2009-10. 10. First issue involved in this appeal is whether recognition under S.10(23C) (vi) is mandatory when receipts exceed Rs. 1 crore or whether a....
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....e to the file of the Assessing Officer for fresh consideration, in the light of the above observations. The Assessing Officer shall accordingly redecide the issue in accordance with law and after giving reasonable opportunity of hearing to the assessee. 12. In the result, this appeal of the Revenue, is allowed for statistical purposes. APPEALS CONCERNING MALLAREDDY EDUCATIONAL SOCIETY Revenue's Appeals: ITA No.1595/Hyd/201 1 Assessment year 2006-07 ITA No.1596/Hyd/2011 Assessment year 2007-08 ITA No.1597/Hyd/2011 Assessment year 2008-09 ITA No.1598/Hyd/2011 Assessment year 2009-10 AND Assessee's Appeal: ITA No.1586/Hyd/2011 Assessment year 2006-07 13. Now, we may take up the five appeals concerning Mallareddy Educational Society. Out of them, four are by the Revenue and one is by the assessee, there being cross-appeals for assessment year 2006-07. All these appeals are directed against similar but separate orders of the CIT(A)-I, Hyderabad, all dated 4.7.2011 Revenue's appeals: 14. The only first issue involved in appeals ITA No.1595/Hyd/2011 for assessment year 2006-07 and ITA No.1596/Hyd/2011 for assessment year 2007....
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....would not be allowed in respect of such asset. Only if the value of the asset was not allowed as expenditure under S.11, the Assessing Officer is required to allow depreciation thereon, as per the rate applicable to those assets, as held in the case of Mahila Sidh Nirman Yojna, cited supra. This issue raised by the Revenue in all these appeals, is set aside to the file of the Assessing Officer for fresh consideration, in the light of the above observations. The Assessing Officer shall accordingly redecide the issue in accordance with law and after giving reasonable opportunity of hearing to the assessee. 16. In the result, these appeal of the Revenue, are allowed for statistical purposes. Assessee's Appeal: ITA No.1586/Hyd/2011 17. The only issue involved in this appeal relates to assessment of contributions received by the society towards corpus of the trust, and effective ground taken by the assessee in this behalf reads as follows-. "1. The order of the Commissioner of Income-tax (Appeals) is erroneous to the extent it is prejudicial to the appellant. 2. The learned Commissioner of Income-tax (Appeals) erred in confirming the action of the Assessing Of....
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....nt year 2006-07 ITA No.1600/Hyd/2011 Assessment year 2007-08 ITA No.1601/Hyd/2011 Assessment year 2008-09 ITA No.1602/Hyd/2011 Assessment year 2009-10 & Assessee's Appeal: ITA No.1587/Hyd/2011 Assessment year 2007-08 ITA No.1588/Hyd/2011 Assessment year 2008-09 ITA No.1589/Hyd/2011 Assessment year 2009-10 20. Now, we may take up the seven appeals concerning Chandramma Educational Society, Hyderabad. Out of them, four are by the Revenue and three are by the assessee, there being cross-appeals for assessment years 2007-08 to 2009-10. All these appeals are directed against a common order of the CIT(A)-I, Hyderabad dated 5.7.2011 Revenue's appeals: 21. The first issue involved in the appeals for assessment years 2007-08 to 2009-10, being ITA Nos. 1600 to 1602/Hyd/2011 respectively, is whether recognition under S.10(23C) (vi) is mandatory when receipts exceed Rs. 1 crore or whether alternative relief u/s. 11 is automatically available to assessee registered under S.12AA of the Act. We have dealt with this issue hereinabove, while dealing with the corresponding grounds of the Revenue in the appeals ITA Nos.1440 to1442/Hyd/2011 con....
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....sing Officer for fresh consideration, in the light of the above observations. The Assessing Officer shall accordingly redecide the issue in accordance with law and after giving reasonable opportunity of hearing to the assessee. 23. In the result, these appeal of the Revenue, are allowed for statistical purposes. Assessee's Appeals ITA No.1587 to 1589/Hyd/2011: 24. The only issue involved in these appeal relates to assessment of contributions received by the society towards corpus of the trust, and effective ground taken by the assessee in this behalf, as taken from appeal, ITA No.1587/Hyd/2011 for assessment year 2007-08 reads as follows- . "1. The order of the Commissioner of Income-tax (Appeals) is erroneous to the extent it is prejudicial to the appellant. 2. The learned Commissioner of Income-tax (Appeals) erred in confirming the action of the Assessing Officer in treating the contributions received of Rs. 55,58,000/- as the income of the appellant. The learned Commissioner of Income-tax (Appeals) ought to have considered the fact that the said amount was utilized for the purpose of objective of the society and therefore, the receipt is exempt from....
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....he CIT(A)-I, Hyderabad both dated 1.7.2011 for the assessment year 2003-04 and 2004-05 and 2006-07 to 2009-10; and one order of that very date for the assessment year 2005-06. Revenue's appeals: 28. The first issue involved in all the appeals of the Revenue, except ITA No.1657/Hyd/2011 for assessment year 2005-06, is whether recognition under S.10(23C) (vi) is mandatory when receipts exceed Rs. 1 crore or whether alternative relief u/s. 11 is automatically available to assessee registered under S.12AA of the Act. We have dealt with this issue hereinabove, while dealing with the corresponding grounds of the Revenue in the appeals ITA Nos.1440 to1442/Hyd/2011 concerning Sri Venkata Sai Educational Society. For the detailed reasons discussed in that context, in paras 4 and 5 hereinabove, we set aside the impugned orders of the lower authorities in this case also for all the years under appeal and remit back the matter to the file of assessing officer with a direction to assessing officer that he shall reconsider the entire issue in the light of judgment of Supreme Court in the case of M/s Islamic Academy of Education & Another Vs. State of Karnataka and Another (supra), and in t....
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....wards corpus of the trust, and effective grounds taken by the assessee in this behalf, as taken from appeal, ITA No.1583/Hyd/2011 for assessment year 2003-04 reads as follows-. "1. The order of the Commissioner of Income-tax (Appeals) is erroneous to the extent it is prejudicial to the appellant. 2. The learned Commissioner of Income-tax (Appeals) erred in confirming the action of the Assessing Officer in treating the contributions received of Rs. 28,00,000/- as the income of the appellant. The learned Commissioner of Income-tax (Appeals) ought to have considered the fact that the said amount was utilized for the purpose of objective of the society and therefore, the receipt is exempt from tax." But for the amount mentioned in ground No.2 above, grounds of appeal are identical in the appeal for the assessment year 2004-05 as well, and the amount mentioned for that year is Rs. 4,50,000. 32. We heard both the parties and perused the material on record. We have dealt with identical issue while dealing with the appeal of the assessee in the case of Malla Reddy Educational Society, viz. ITA No.1586/Hyd/2011, in para 18 hereinabove. The circumstances leading to th....
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....r the detailed reasons discussed in that context, in paras 4 and 5 hereinabove, we set aside the impugned orders of the lower authorities in this case also for all the years under appeal and remit back the matter to the file of assessing officer with a direction to assessing officer that he shall reconsider the entire issue in the light of judgment of Supreme Court in the case of M/s Islamic Academy of Education & Another Vs. State of Karnataka and Another (supra), and in the cased of T.M.A. Pai Foundation and Others Vs. State of Karnataka and Others (Supra), and find out whether the assessee has received any money over and above the fees prescribed and thereafter decide the issue afresh in accordance with law after giving reasonable opportunity of hearing to the assessee. We make it clear that the assessee is not entitled for exemption u/s 11 in case it collected any money by whatever name it is called i.e., donation, building fund, auditorium fund etc. etc., over and above the prescribed fee for admission of students. 36. The next issue involved in all these appeals of the Revenue relates to the additions made on account of depreciation claimed by the assessee. We have dealt w....