TaxTMI 
TaxTMI 
2018 (4) TMI 622
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....able institution in terms of Sec. 2(15) of the Income Tax Act, 1961 (in short 'the Act') and, thus held the assessee to be eligible for exemption under Sections 11 & 12 of the Act. The assessee, in its Cross-objection, seeks the claim of exemption u/s 10(23C) of the Act, whose denial has been affirmed by the CIT(A). 2. In the other three assessment years, assessee is in appeal urging the exemption under Sections 11 & 12 of the Act as also u/s 10(23C) of the Act, and in such years, the CIT(A) departed from his earlier stand of Assessment Year 2009-10, and instead upheld the action of the Assessing Officer in denying the exemption claimed by the assessee under Sections 11 & 12 of the Act as well as exemption claimed under Sec. 10(23C) of the Act. In this background, the rival counsels have made their submissions and the relevant material has been perused. 3. In sum and substance, the first substantive issue in the captioned appeals arises from the stand of the assessing authority, which is common for all the captioned assessment years, to the effect that the assessee is not an 'educational institution' so as to claim exemption in terms of Sections 11 & 12 of the Act and further....
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....augmentation and effective deployment of banks' resources including analytical and perspective studies of various sectors of the economy with a view to promoting national development. c. to provide consultancy services under its auspices or through its faculty to banks or any other institutions or individuals on matters having bearing on productivity in banking services, optimum use of financial resources or any other matter conducive to economic betterment; d. to award diplomas, certificates and other distinctions and to confer degrees on candidates and prescribe standards of proficiency for the award of such diplomas, certificates, degrees and other distinctions; e. to assist banking and financial institutions in matters such as designing measurement tests for employees selection, appraisal programmes, conducting morale and productivity studies, streamlining organizational structure and to review from time to time, the impact of educational, training and research activities and offer suggestions for filling the gaps in the banking and financial systems; f. to establish and maintain libraries and information services; g. to establis....
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....itution. For these reasons, the claim of exemption by the assessee under Sections 11 & 12 of the Act has been denied. The stand of the Assessing Officer is common for all the captioned assessment years. 5. So far as the position at the level of CIT(A) is concerned, we find that in Assessment Year 2009-10, the CIT(A) recorded that Assessing Officer had failed to establish "as to how the activities of the appellant are covered under proviso to Sec. 2(15) of the I.T Act". Secondly, he disagreed with the Assessing Officer that there was any profit motive present in the operations of the assessee so as to attract the proviso to Sec. 2(15) of the Act. Thirdly, the CIT(A) noted that there was no "commercial intent" in the activities of the assessee and, therefore, he held that the activities of the assessee are compliant with Sec. 2(15) of the Act even after the insertion of proviso w.e.f. 01.04.2009, and, thus upheld assessee's case for exemption under Sections 11 & 12 of the Act. Insofar as the assessment years 2010-11, 2011-12 and 2012-13 are concerned, the CIT(A) has disagreed with the assessee and upheld the ultimate conclusion of the Assessing Officer to the effect that the activ....
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....evant for our purpose, the expression 'charitable purpose' seeks to include 'education'. The case of the assessee is that its activities fall within the scope of the expression 'education' and, therefore, it is covered within the meaning of 'charitable purpose' contained in Sec. 2(15) of the Act. The stand of the Revenue is to the contrary as, according to it, the activities of the assessee are merely to carry out training, seminars, post-graduate training and, that too, against collection of fees and, therefore, cannot be considered as 'education'. Further, the expression 'charitable purpose' also includes the activity of 'advancement of any other object of general public utility'. According to the Revenue, even if the activities are to be considered as falling within the scope of Sec. 2(15) of the Act, it fits into the said expression 'advancement of any other object of general public utility'. The proviso to Sec. 2(15) of the Act was added w.e.f. 01.04.2009, which prescribes that the activity of 'advancement of any other object of general public utility' shall not be construed to be for 'charitable purpose' if it involves carrying on of any activity in the nature of trade, comme....
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....onal campus has more than 60,000 books. It was also pointed out that assessee offers programmes in collaboration with Kellogg School of Management, Northwestern University USA, The London School of Economics and Political (LSC), UK and CME Group, Chicago, etc. All these assertions of the assessee have not found any negation by the assessing authority or even by the Revenue before us. 10. Before us, it was argued by the ld. DR that fee is being charged and subscriptions are received from the member-banks which generates surplus in the course of activities, and thus, the activities are not for education. It is well understood that educational institutions are also required to generate funds for carrying out its activities, and the fact that assessee is collecting fees, by itself, will not make it a non-educational activity so as to go out of the definition of 'education' contained in Sec. 2(15) of the Act. In this context, we may refer to the judgment of the Hon'ble Supreme Court in the case of T.M.A. Pai Foundation vs State of Karnataka, (2002) 8 SCC 481, wherein the Hon'ble Supreme Court has also recognised the necessity for the educational institution to generate funds ....
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.... be confined only to scholastic instructions, but other forms of education are also included in the expression 'education'. Though the decision of the Hon'ble Gujarat High Court is in the context of Sec. 10(22) of the Act, yet, it is of relevance for us since it has explained the meaning of the expression 'education' which, in our view, is germane to decide the controversy before us. The assessee before us is indisputably engaged in conducting higher education training, coaching and research in the field of banking and finance, and the ratio of the judgment of the Hon'ble Gujarat High Court certainly goes to show that its activities are in the field of 'education' for the purposes of Sec. 2(15) of the Act. 12. Similarly, the decision of the Mumbai Bench of the Tribunal in the case of Indian Institute of Bankers vs DCIT (Exemption), (2002) 74 TTJ 523 (Mum) was also relied upon. The assessee before the Mumbai Bench of the Tribunal, i.e. Indian Institute of Bankers, was engaged in the activity of promoting the study of theory of banking and, for that purpose, it was conducting exams, lectures, etc. Notably, the activities of the assessee before us are also on the same lines....
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....ssee is engaged in 'education', therefore, on this basis, it will be in the fitness of things to deduce that assessee is not ousted from Sec. 2(15) of the Act because the proviso is not applicable to it. In any case, if one is to examine the applicability of the proviso on merit, even then we find that the same does not come into operation in the present case. Firstly, the CBDT in its Circular no. 11/2008 dated 19.12.2008 clarified that the proviso would apply only in situations where there is a profit motive in the activities undertaken. Secondly, the phraseology of the proviso itself lends credence to a premise that it comes into operation only in situations where profit is the motive in the activities undertaken. Pertinently, the proviso applies in a situation "if it involves carrying on of any activity in the nature of trade, commerce or business or any activity of rendering any services in relation to any trade, commerce or business..........". Ostensibly, the three expressions used therein, i.e., 'trade', 'commerce' or 'business' are to be understood as activities which are undertaken with a motive of earning profits. Therefore, the moot question to be examined is as to wheth....
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....ation and research in the field of banking and finance. Not elaborating further on this aspect, as we have already inferred earlier that assessee is in the field of education, at this stage it would suffice for us to note that there is no commercial intent behind setting-up of the assessee. In fact, the Assessing Officer has sought to draw a parallel with the case before the Hon'ble Patna High Court in Bihar Institute of Mining & Mine Surveying (supra) which, in our view, is wholly inappropriate. The Hon'ble Patna High Court was dealing with the claim of an entity for registration u/s 12A of the Act on the ground that its activity of coaching of students for particular examinations was to be viewed as imparting education. The Hon'ble Court noted that "the running of a private coaching institute for the purpose of training the students to appear at some specified examinations upon taking specified sum from the trainees would not bring the petitioner within the provisions of section 2(15) of the Act." The aforesaid observation of the Hon'ble Court clearly bring out the distinction between the entity before us and that was before the Hon'ble Patna High Court, which was a c....