TaxTMI 
TaxTMI 
2019 (12) TMI 862
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....icer erred and was not justified in alternatively allowing exemption u/s 10(23C)(iiiad) of the Act, and the Learned CIT(A) erred and was not justified in upholding the action of the Learned A.O. The appellant craves leave to add, amend, alter, substitute modify any of the above grounds on or before the final hearing. 2. Briefly stated facts are that case of the assessee was picked up for scrutiny assessment and the assessment u/s 143(3) of the Income Tax Act, 1961 (hereinafter called as 'the Act') was framed vide order dated 28.3.2013. The assessee society is duly registered u/s 12AA of the Act. While framing the assessment, the A.O. observed that during the year under appeal, the assessee had declared income from other sources of Rs. 20,20,000/- and claimed application of money of Rs. 42,332/-. The assessee also claimed Rs. 3,03,000/- as the amount set out. The assessee claimed Rs. 16,74,668/- as amount accumulated u/s 11(2) of the Act. The A.O. did not allow this claim and treated the same as income of the assessee. Aggrieved by this, the assessee preferred an appeal before Ld. CIT(A), who after considering the submissions, dismissed the appeal. Now the assessee is....
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....09 ITR 441 (Bom.) The reliance was also placed upon the decision of Hon'ble Gujarat High Court rendered in the case of ACIT Vs. Stock Exchange Ahmedabad (Tax appeal No.207 to 213 of 2000). 6. Ld. D.R. opposed these submissions and supported the orders of the authorities below. 7. We have heard the rival submissions, perused the materials available on record and gone through the orders of the authorities below. Ld. CIT(A) rejected the claim of accumulation of fund u/s 11(2) of the Act by observing as under: 8. The contention of the assessee is that merely furnishing the requisite form belatedly should not be the reason for rejection of claim for accumulation of funds. In this regard, the assessee has relied upon the judgement of the Hon'ble Bombay High Court in the case of CIT Vs. Nagpur Hotel Owners Association (supra), wherein the Hon'ble High Court has held as under: 9. It is pertinent to note that as per section 11 of the Act, the assessee is required to exercise option for accumulation of funds in a prescribed format as prescribed under rule 17 of the Income Tax Rules (in short 'the Rules'). The time limit prescribed under the rule 17 for exercising such....
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....ourt in the case of Council for Indian School Certificate Examination Vs. DGIT (supra), the Hon'ble Delhi High Court held as under: 14. Respectfully following the judgement of the Hon'ble Delhi High Court, we hereby direct the A.O. to grant exemption u/s 10(23C) of the Act and delete the addition. 15. In the result, appeal of the assessee is partly allowed. Order was pronounced in the open court on 17.12.2019. ============= Document 1 4.4 I have considered the facts of case and the written submission filed by the appellant. Any notice of accumulation u/s 11(2) must be supported by a Resolution to the effect. This is also clear from the format of Form No. 10. Further, as per section 11(2)(a), where 85% of the income is not applied during the previous year but is accumulated or set apart, it will be excluded from the total income of the previous year provided the appellant specifies by a notice in writing given to the A.O. in the prescribed manner i.e., in Form No. 10 as per Rule 17, the purpose for which the income is being accumulated or set apart and the period for which the income is being accumulated and such period shall not exceed ....
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.... v. Trustees of Shri Teckchand Chandiram Trust [1990] 184 ITR 537. The Revenue contends that the ratio of these decisions will have no application to the amended rule 17 by which limitation is prescribed in the body of the rule and not in the body of Form No. 10. These decisions proceed only on the basis that limitation is neither prescribed in the Act nor the Rules, which, according to the Revenue, means by implication that if limitation is prescribed by the rule it would be valid. This submission is not correct. A close examination of these judgments will reveal that reference to the absence of limitation in the rule so only factual. There is no scope to read in those judgments a ratio that limitation could have been legally prescribed in the rule in the absence of any specific power to that effect. The Supreme Court decisions referred to above are clear. They specifically speak of the rules and not the form. In principle also no distinction between the form and the rule can be drawn to judge the extent of delegation under section 11(2)(q) where the language does not permit delegation of power to prescribe limitation to give notice. 9. The cont....
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....the case of Oxford University Press v. CIT [2001] 247 ITR 658/115 Taxman 69 (SC) and held that the American Hotel and Lodging Association was entitled to exemption as an educational institute under Section 10(23C) (vi) of the Act. We may only record here that the aforesaid institute was not directly imparting education and had not employed teachers who were teaching or giving lectures to the students. Decision in Oxford University Press (supra) is distinguishable as the said assessee was in publication business and engaged in sale of books as a business venture. The assessee had therefore claimed exemption on the ground that it was a university and not on the ground that it is an educational institution. For reasons set out in the majority decision, the claim of the assessee was rejected. 7. Recently, the Madhya Pradesh High Court in CIT v. M.P. Rajya Pathya Pustak Nigam, [2009] 181 Taxman 50/318 ITR 497 (MP) examined a similar question and after referring to several decisions has held that the term educational purpose was not restricted merely to holding of teaching class or lectures but educational purpose was equally....