TaxTMI 
TaxTMI 
2019 (4) TMI 1579
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.... Briefly the facts, as taken from AY 2013-14 are, assessee, a society filed its return of income for AY 2013-14 on 11/10/2019 declaring total income of Rs. Nil after claiming exemption u/s 10(23) of the Income-tax Act, 1961 ( in short 'the Act'). Subsequently, the case was selected for scrutiny and notice u/s 143(2) was issued to the assessee on 22/09/2014 and 05/01/2015 and duly served on the assessee. As there was no proper representation/compliance from the assessee, the AO completed the assessment u/s 144 of the Act. He noticed that assessee has gross receipts of Rs. 40,52,238/- and arrived at taxable income of Rs. 17,56,053/- in the statement of total income. On the above income, assessee claimed exemption u/s 10(23C)(iii) of the Act a....
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....23C)(iiiad) of the I.T. Act. Secondly, the existence of the multifarious activities in the Memorandum of Association is enough for rejecting the claim of exemption u/s.10(23C)(iiiad) of the I.T. Act. There is no need to go into factual aspects of the case when the objectives are clear Memorandum of Association. The ratio of the case law cited by the AR of the appellant are not applicable to the facts of the case. The appellant also not obtained exemption u/s.12AA of the I.T. Act. Therefore, I confirm the action of the AO in rejecting the claim of exemption u/s.10(23C)(iiiad) of the I.T. Act, and taxing the income at maximum marginal rate." 4. Aggrieved by the order of CIT(A), the assessee is in appeal before us raising the following ground....
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....ole of the relevant AY. Thus, according to him, assessee was solely existing for educational purposes during the relevant AY. In support of this contention, he placed reliance upon the decision of Hon'ble Kerala High Court in the case of CIT Vs. Geetha Bhavan Trust [1995] 213 ITR 296 (Kerala). 6. On the other hand, ld. DR submitted that, the fact that the assessee has multiple objectives itself, is enough to reject the claim of exemption u/s 10(23) and further submitted that ld. AR has relied on the decision of Hon'ble Kerala High Court in the case of Geetha Bhavan Trust(supra), whereas the case is relevant to section 10(22). Thus, according to him, the case is not relevant to the case of assessee. 7. In the rejoinder, the ld. AR submitte....
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....or educational purpose and not for purpose of profit, is eligible to claim exemption if its gross are less than Rs. 1 crore. In the case before us, we find that the assessee has carried on only educational activities and its gross receipts were less than Rs. 1 crore during this year and particularly all the receipts are relating to educational activities only. Similar case had come up for consideration before the Hon'ble Kerala High Court in the case of Geetha Bhanu Trust (supra) wherein the Hon'ble High Court has held as under: "5. What section 10(22) speaks of is income of a university or other educational institutions existing only for educational purposes, and not for purpose of profit. Here is a trust running two educational institut....
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....' means 'to be present force, activity, or effect at a given time'. The above decision is no doubt on section 10(22), but, the said section was replaced by section 10(23C) and even in the given case, assessee was running an educational institution and carried on only educational activities during this AY and had not ventured into any other activity. Therefore, in our considered view, the decision of the Hon'ble Kerala High Court is very much relevant for this case. We find that the CIT(A) has rejected the contention of the assessee on the ground that the assessee has multiple objectives other than solely educational activities in the object clause. The tax authorities should apply the provisions of the Act as the Legislature intended to dev....