2016 (12) TMI 357

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....u/s 12A (a) of the I.T. Act, 1961 by the Commissioner of Income Tax, Jaipur vide order dated 19.7.1998. Later on it has come to the notice that: "2.1. The institution is collecting fees under various head from the students in excess of actual expenditure. 2.2. The fees are being charged by the institution in commercialized manner with a motto of earning profits. 2.3. According to object, the society was to undertake help to poor children by way of free education and also providing hostel facilities to them. But no such help/assistance is being provided to poor children. 2.4. The institution is generating surplus amount year after year as reflected in the books of account." 3. In view of the above, the institution is not carryin....

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....es of the case and in law, the order of the Tribunal is perverse in reversing the order of CIT passed u/s.12AA(3) of the Income Tax Act?" "(ii) Whether under the facts and in the circumstances of the case, the ld. Tribunal is justified in holding that the object and purpose of assessee Samiti are charitable falling u/s.2 (15) of the IT Act and further directing the CIT to allow registration u/s.12A of the Income Tax Act?" 5. Counsel for the appellant contended that the assessee has not fulfilled the criteria which are required under Section 12AA and therefore, contended that the order passed by the Tribunal is contrary to law and required to be quashed and set aside. 6. We have heard counsel for the parties. 7. In view of the observa....

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....d the exemption vide the order of the CBDT dated 23.03.2007 for the assessment year 1999-2000 and onwards (PB 39). Now the question arises whether the assessee has achieved the objects for which the society has been registered under the Registrar of Societies Act. One of the object of the society is to open school and libraries which has been done is, not under dispute. As regards the objection of the ld. CIT that the assessee is having the surplus. Now the question arises, if the assessee society has a surplus, can an exemption already given since 19-7-88 as withdrawn. The ld. CIT has not whispered even a word in his order whether the assessee society has its objects for earning a profit, during the course of running the activities since i....

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....ts, income and expenditure, audited balance sheet and audit report for the financial year 1998-99 to financial year 2005- 06. The strength of the students at 876 during the F.Y. 1998-99 has risen to 1504 in the F.Y. 2005-06, fixed assets have risen from Rs. 31.53 lacs from F.Y. 1998-99 to Rs. 165.29 lacs in the F.Y.2005-06. The surplus arising each year have been used from the development of the school in incurring the capital expenditure as per fixed assets schedule for different years on record. The surplus as reflected in the F.Y.1998-99 at Rs. 20.95 lacs remained at minus Rs. 15.63 lacs in the F.Y.2005-06. The position of the surplus as per PB 16 is as under:- Financial Year Surplus (Rs. In Lacs) 1998-99 20,95,403 1999-00 42....