TaxTMI 
TaxTMI 
TaxTMI 
2019 (1) TMI 92
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....as not raised by the Appellant before the Commissioner (Appeals) while filing the Appeal, it may be considered and decided by the CIT (Appeals) even if, it was not put up at the assessment stage. The powers conferred in the Section 251 allows the CIT(A) to play around the issues taken up in the Assessment Order and not to move outside the Assessment Order, ie, not to raise the fresh issues but he can decide any issue if, raised by the Appellant at the Appeal stage afresh. In this case the Hon'ble CIT(A) embedded the soul of above explanation under the powers conferred to him in section 251(1) of I.T. Act, 1961. 2. Because the Hon'ble CIT(Appeals) has failed in raising any specific query to justify his finding that there was violation of provisions of sections 11,12 and 13 of l.T. Act, 1961 without appreciating the fact that the Appellant is a charitable (Society) Trust within the meaning of section 2(15) of I.T. Act and which has already been granted exemption under section 12A of I.T. Act by the Hon'ble Commissioner of Income tax. 3. Because the Hon'ble CIT(Appeals) has erred in law and on facts in treating the Hostel & Transport facility to the students as purely commerci....
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....ins of business, unless the business is incidental to the attainment of the objectives of the (Society) trust but in the case of the Appellant the facility of Transport and Hostel is not incidental, but a regular facility being integral part of the trust which cannot be taxed. 10. Because the Hon'ble CIT(A) has erred in law and on facts in separating the educational institution and the Trust while both are part and parcel of each other, the (Society) Trust runs the school and provide the transport & Hostel Facility to the students. Therefore, the provision of Transport and Hostel facility to the students are the integral part of the (Society) Trust and not the incidental business. 11. Because the Hon'ble CIT(A) has erred in law and on facts who opined that the income of Universities or the other educational institutions is to be dealt with for exemption from the incidence of tax u/s 10(23C)(iv) 86 10(23C)(vi) of I.T. Act, 1961 and cannot be claimed under the provisions of sections 11 8& 12 of I.T. Act, 1961, but the Appellant is not an University or Other Educational Institution, but is a (Society) Trust within the meaning of Section 2(15) of I.T. Act, which runs an Education....
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.... of Hostel and Vehicle running expenses though it was clarified that the books of accounts were maintained on the basis of which the surplus from both the heads has been demarcated and declared in the Income & Expenditure Account. 5. Because the Hon'ble CIT(A) has erred in law & on fact that "If the profits must necessarily feed a charitable purpose, under the terms of the trust, the mere fact that the activities of the trust yield profit will not alter the charitable character of the trust. The test is very clear that, the genuineness of the purpose tested by the obligation created to spend the money exclusively or essentially on "charity". This view is supported by Sole Trustee, Lok shikshana Trust Vs. CIT, Mysore, 1976 1 SCC 254 that: ( SCC pp. 274-75, para 41) 6. Because the Hon'ble CIT(A) has erred in law and on fact igr. me ITAT decision that Transport & Hostel Facilities surplus cam.:: t-e considered as Business Income of the Society if the same was an internal part of its objects.(ITANO.4639/Del/2015 Addl. CIT, Range- 1, Ghaziabad Vs. Krishna Charitable Trust, Ghaziabad. 7. Because the Hon'ble CIT(A) has erred in law and on facts in not allowing the exemption u/s 11....
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....is common order. 5. First, we state the facts for assessment year 2006 - 07 and the facts for assessment year 2007 - 2008 are similar. The assessee filed its return of income for assessment year 2006 - 2007 on 31/10/2006 declaring nil income in the status of Association of the person in the assessment was completed under section 143 (3) of the act on the returned income vide order dated 12/11/2008. Subsequently it was noticed that the assessee is engaged in providing of hostel facilities and transportation facilities to the students during the year but has not maintained separate books of accounts for these business activities as per the provisions of section 11 (4A) of the act and therefore assessee was not eligible for exemption under section 11 on receipt from these activities and as such the assessee should have disclosed surplus generated from these activities for taxation in the return of income. such omission on failure on the part of the assessee to disclose truly and fully all material facts necessary for the assessment has necessitated the initiation of proceedings under section 147 of the act. Consequently notice under section 148 was issued to the assessee after obtain....
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....the income of the assessee by applying the provisions of section 251 of the income tax act holding that the assessee is neither entitled to the benefit of exemption from incidence of tax under section 11 (1) (a) of the income tax act, 1961 nor under section 11 (1) (b) nor under section 12 of the income tax act in any manner. He therefore held that once the exception is withdrawn the entire income of the appellant was to be treated as taxable under the head income from other sources and not under the head business and profession. Accordingly he upheld that the gross receipt of the assessee of Rs. 3 44200 for assessment year 2006 - 07 and Rs. 9 31950/- for assessment year 2007 - 08 respectively has to be treated to be the income of the appellant liable to tax and not liable to the benefit of exemption from the incidence of tax under the provisions of section 251 (1) (a) read with the provisions of section 251 (2) of the income tax act 1961 and no further consideration of the action of the learned assessing officer as detailed in the impugned assessment order is required. Therefore, he enhanced the income of the assessee by determining the total income at the gross receipt of the ass....
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.... the lower authorities. The brief facts of the assessee trust shows that it is a charitable society within the meaning of section 2 (15) of the income tax act 1961 which has been granted exemption under section 12 A of the income tax act. The assessee society runs an institute namely RV Northland Inst pharmacy and provides hostel and transport facilities to the students of R V Northland Inst pharmacy which is an integral part of the main activities of education but were not commercial activities rather than this were the necessary activities ancillary to the attainment of the main objectives , receipts for the respective year in the books of accounts were disclosed. It is not the case of the learned assessing officer that the hostel facilities and the transport facilities are provided to the persons who are neither the students nor the staff of the assessee trust. The identical issue has been decided by the coordinate bench in ITA No ITA No. 4639/Del/2015 Assessment Year: 2011-12) where one of us was the author holding that transport facilities and hostel facilities provided by the educational institutes to the students of that particular society and staff of the educational Instit....
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....rther meals being supplied in a hostel to the scholars, visitors, guest faculty etc. cannot be exigible to sales tax where main activity is academics as held in Scholars home Senior Secondary School 42 VST 530. Further, the reliance placed by the lower authorities on the decision of the Hon'ble Madras High Court in case of DCIT versus Wellington charitable trust is also misplaced because in that case, the only activity of that particular trust was renting out of the property and not education. We are also not averse to considering the latest legal developments too where in the recently introduced new legislation of Goods and service tax it is provided that no GST would be chargeable on the hostel fees etc recovered from the Students , faculties and other staff for lodging and boarding as they are engaged in education activities . Therefore, we reverse the finding of the lower authorities and held that transport and hostel facilities surplus cannot be considered as business income of the assessee society, which is mainly engaged in educational activities, and these activities are subservient to the main object of education of the trust. In the result 1 - 3 of the appeal of the ass....