2004 (7) TMI 48

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....ons. While filing nil return for the assessment year 1992-93, the respondent/assessee claimed exemption under sections 10(22) and 11 of the Income-tax Act (hereinafter referred to as the "Act") and the same was accepted by the Income-tax Officer under section 143(1)(a) of the Act. The case of the respondent/assessee (trust) was taken up for scrutiny and the assessment was completed under section 143(3) of the Act on March 20, 1995, by taxing the income and held that the respondent/assessee (trust) was not eligible for exemption under sections 11 and 12 of the Act, as the Assessment Officer has violated section 11(4A) of the Act. An appeal was preferred by the respondent/assessee (trust) before the Commissioner of Income-tax (Appeal....

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....d counsel for the petitioner restricts his arguments only with regard to substantial questions of law (ii) and (iii) referred to above. In this regard, it is apt to refer sections 10(22) and 11(4A) of the Act, which read as follows: "10. In computing the total income of a previous year of any person, any income falling within any of the following clauses shall not be included-... (22) any income of a university or other educational institution, existing solely for educational purposes and not for purposes of profit; 11. Income from property held for charitable or religious purposes.-... (4A) Sub-section (1) or sub-section (2) or sub-section (3) or subsection (3A) shall not apply in relation to any income of a trust or an inst....

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....n 11(4A) of the Act is not at all attracted to the instant case. The apex court in Aditanar Educational Institution v. Addl. CIT [1997] 224 ITR 310, interpreting the scope and applicability of section 10(22) the Act to the charitable institutions, held as follows: "It would be unreal and hypertechnical to hold that the assessee-society was only a financing body and would not come within the scope of 'other educational institution' as specified in section 10(22) of the Act. The object of the society was to establish, run, manage or assist colleges or schools or other educational institutions solely for educational purposes and in that regard to raise or collect funds, donations, gifts, etc. Colleges and schools were the media through w....