TaxTMI 
TaxTMI 
2018 (8) TMI 643
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....ow the assessee's depreciation claim on the capital expenditure holding that when the entire costs of assets have already been claimed as application of income towards objects of the Trust, the claim of depreciation on the cost of the very same assets results in double deduction, assessed the accumulated income in ay 2006-07 as it was not- applied in ay 2011-12, denied the benefits of exemption u/s 11 invoking the provisions of sections 13(1) (c) for ay 2011-11 & under sections 13(1) (c) & 13 (1) (d) for ay 2012-13 etc. 4. Aggrieved, the assessee filed appeals before the Ld. CIT(A) pleading, inter alia, that that the AO refused exemption without making any discussion on denial of exemption u/s 10(23) (c) for ay 2011-12 etc. The Ld. CIT (A) after considering all the pleas of the assessee , the assessment orders etc , relying on this tribunal order in the assessee's case in earlier year allowed the appeals on the issue of the disallowance of honorarium payments made to specified person , viz Ms. Meenakshi Sundararajan, u/s 13(3) for both the ays and confirmed the denial of exemptions on certain other issues for both the ays. Aggrieved , on the issues of denial of exemptions, the Ass....
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....anted to it by the CCIT for both the Asst. Years 2011-12 & 2012-13 and therefore, the A.O's action in denying exemption for the aforesaid reason is held to be valid and therefore confirmed. This ground is therefore dismissed for both the Asst. Years in appeal, e. 2011-12 & 2012-13". 6. Before us, the Ld. A R submitted that the order of the Commissioner of Income Tax (Appeals) is contrary to law, facts and circumstances of the case.The Commissioner of Income Tax (Appeals) ought to have appreciated that Hon'ble Apex Court in the case of M/s. Queens Educational Society Vs CIT in Civil Appeal No.5167 of 2008dated 16.03.2015 has categorically stated that realization of surplus in the course of operation of educational institution cannot mean that they are not for the purpose of profit, particularly when the entire income has been utilized for the purposes of education. The Commissioner of Income Tax (Appeals) ought to have appreciated that there has been no finding that the surplus has not been utilized for the purpose of education, he erred in confirming the denial of exemption u/s.10(23C)(vi) and hence his orders may be quashed and exemption u/s.10(23C)(vi) may be restored. Per cont....
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....urposes of profit". A five member bench of the Hon'ble SC in the case of Islamic Academy of Education and another vs. State of Karnataka and others decided on 14 August, 2003 in the context of the determination of the reasonable fees to be charged by private educational bodies held , inter alia , that a surplus of 6 to 15 % could be held as reasonable or permissible limit. The Jurisdictional High Court in the case of Madras Hotels Association vs Commissioner Of Income-Tax, Madras in 111 ITR 241, held , inter alia, thatthe best evidence to find out whether the purpose of the activity is to earn income or profit, is the very accounts of the association ie the person. In the light of these ratios and in the absence of any material to the contrary from the assessee , on the above facts ie when the assessee makes huge profits year after year, the findings recorded by the lower authorities that the assessee is running a profitable venture ,during the impugned years, is justified and hence the corresponding grounds of the assessee are dismissed for both the ays. 8. Onthe amount parked with sister concern : 8.1 From the account copy furnished by the assessee , the AO found that the asses....
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.... A.O in making the addition of the difference between the amount received and paid back to the sister concern is upheld and the addition confirmed. This ground is, therefore, dismissed." 8.3 Before us, the Ld. AR submitted that the same submissions made before the Ld. CIT(A) and relied on certain case laws. Per contra, the Ld. DR supported the orders of the lower authorities. 9. We heard the rival submissions and gone through relevant material. The impugned transactions have happened long before. The assessee has received the excess amount after a long gap. Though, the rationale is questioned at assessment stage itself, it has not laid any contemporaneous materialin support of its contentions, viz Minutes book, the facts and circumstances on which the alleged transactions happened, who and when took the alleged decisions etc , before the lower authorities and hence they have rejected assessee's claim of exemption. Before us also, the assessee has not laid any material to assail the findings recorded by them. Therefore, the corresponding grounds of the assessee are dismissed for this ay. 10. We have considered all other claims of the assessee. The A O has denied the claim of e....
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....ght to have appreciated that the Department has not accepted the relied on decision of the Hon'ble ITAT in ITA No.318/MDS/2014 dated 27.5.2014." 13. While making the assessments, the AO found that payment of Rs. 1,08,600 & Rs. 1,11,900/- was made to Ms. Meenakshi Sundararajan, the wife of the founder of the trust, in a ys 2011-12 & 2012-13, respectively , and after considering assessee's submissions etc disallowed them u/ss 13(1)(c), 13(2) and 13(3). Aggrieved , the assessee filed appeals before the Ld. CIT(A) , who relying on this tribunal decision, on the identical issue in the assessee's case in ITA No.318/Mds/2014 dated 27.5.14 for the asst. year 2010-11, allowed the appeals. Aggrieved the Revenue filed the above appeals. 14. The Ld DR presented on the lines of the grounds of appeal and the orders of the AO . Per contra, the Ld AR relied on the orders of this tribunal and the Ld. CIT(A). 15. We heard the rival submissions and gone through relevant material. The relevant portion of this Tribunal order, supra, is extracted as under: "7. First, let us consider, whether the assessee is eligible for deduction under sec.11 or not, in view of payment of Rs.,13,400/- made to Ms. ....