AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2023 (5) TMI 1363
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....s well as on the facts of the case rejecting alternative claim under of S. 11(2) despite the facts that the assessee is registered u/s 12A for which the assessee is entitled as per law. 2. The appellant prays your Honor's indulgence to add, amend or alter all or any of the ground of the appeal on or before the date of hearing." 3. Succinctly, the fact as culled out from the records is that return of income was filed on 18/11/2014 declaring nil income. The case was selected for compulsory manual scrutiny. Notice u/s 143(2) was issued on 10/09/2015 by the ITO(E), Ward-1, Jaipur which was duly served upon the assessee on 14/09/2015 through registered post. Subsequently, this case has been received on transfer to this ward to complete scrutiny assessment in compliance to order u/s 127 of the I.T. Act, passed by CIT (Exemption), Jaipur dated 01/07/2016. Notice u/s 142(1) of the Income Tax Act, was issued on 08/07/2016 along with a detailed query letter by the undersigned. In response, Shri J. M. Vyas CA & AR of the academy attended the assessment proceedings from time to time and furnished requisite submissions which are placed on record. Books of account consisting of cash ....
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....ature of charitable and therefore, it is not entitled for claiming exemption 10(23C)(iiiab) and 10(23C)(iv) rws 2(15) of the Act. Therefore surplus of the assessee declared in the books of account was added to total income of the assessee. 3.4 Being aggrieved, the assessee carried the matter before the CIT(A) Id CIT(A) had confirmed the action of the AQ by observing assessment order, applicant's written submission, AO's remand report and appellant's rejoined and held that appellant is not eligible for exemption 10(23C) (iiiab). 3.5 Then the assessee preferred appeal before the ITAT, Jaipur, Hon'ble ITAT has confirmed action of the AO and CIT(A). Hon'ble TTAT stated in its decision vide ITA No.440/JP/2014 dated 08/09/2016 in the case of the present assessee for the AY 2010-11 that appellant's claim of exemption u/s 10(23C) (iv), the said exemption is available to any fund or is institution for charitable purposes which are approved by the prescribed authority. Therefore, it can be seen that for any institution to be eligible to be exempt under this clause. Two -the institution should be established for charitable purposes and the institution should be a....
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....r AY 2014-15. Against the order of Hon'ble ITAT for the AY 2010-11, decision of ld.CIT(Exemption) is pending whether further appeal before the Hon'ble High Court is to be preferred or otherwise? At this moment, decision of the Hon'ble ITAT is not final for the Department Hence, considering all the facts and circumstances of the case as well as above discussion, exemption claimed by the assessee u/s 10 of the IT Act as well as claim of benefit of section 11(2) of the IT Act is here by rejected and consequential surplus declared by the assessee itself amounting to Rs.98,70,134/- is hereby added to total income of the assessee. 4. Feeling aggrieved, the assessee carried the matter in appeal before the ld. CIT/NFAC. The appeal of the assessee was dismissed. Apropos to the issue on hand the relevant finding of the ld. CIT(A)/NFAC is reiterated here in below: "The Hon'ble Jurisdictional ITAT has allowed the alternate additional ground of the appellant in A.Y 2010-11 and directed the Assessing Officer to give the benefit to the appellant. First of all, that direction was for A.Y 2010-11 and not for the present assessment year. Further, any benefit u/s 11(2) o....
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.... that the activity of the trust are in the nature of trade, commerce or business and not educational. Thus the AO denies the exemption u/s 10(23C) (ab) as well as the benefit u/s 10,11 and 12 and added Rs. 9870134/- in the income of assessee. On appeal befor CIT Appeal, the ld CIT Appeal also rejected the claim of exemption u/s 10(23C)(iiiab) and also of alternative claime of exemption u/s 11 without considering facts and submission made during course of hearing hence this appeal before your honor. OUR SUBMISSIONS: 1. Directly Covered matter: That the similar issue has already been decided by Hon. HIGH COURT OF JUDICATURE FOR RAJASTHAN BENT AT JAIPUR, D.B, Income Tax, Appeal no 302/2016 in order dated 01-11-2017 in the case of assessee itself for the assessment year 2010-11. In the order. The Hon High Court clearly gives its opinion that this academy is running only with a view to publish educational books and accepted that this is only for purpose of academy which is educational in naure and will entitle for the benefit u/s 10(23)(iiiab). Copy of order enclosed(PB 1-18). Further the similar issue has been decided by this Hon ITAT Jaipur Bench Ap....
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....ducation & Social Welfare, Department of Education L-02, Section of Government of India. The Academy is registered as institution under Registrar of Sansthan vide Reg no 108 in 1969-70. For verification, copy of registration certificate and its constitution submitted (PB 25- 41). * The academy is functioning in public interest with no motive of profit under the arrangement, control and supervision of the Government of Rajasthan. The Academy is carrying on its activities under Centrally Sponsored Scheme of Production of Books at the University Level in different Languages, by the Creation of a Revolving Fund. For verification of facts,we have submitted various letter relating to scheme.( PB 43 to 46) * Its affairs are managed by a Director who is appointed through due process of selection by the State Govt. who is subject to superintendent, direction and control of a Governing Body consisting of Education Minister of the State of Rajasthan as Chairman, three or four Vice-Chancellors of university of the state and three or four persons possessing academic excellence in their respective field. The board is functioning under the arrangement, control and supervision of....
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.... period of three years. The said Hon' CIT. after examination recorded his satisfaction and granted registration which is still in force and valid. We want to say here that the nature of activities of the appellant, nature of income and expenditure and nature of transaction in the books of accounts and claim in the IT return etc are the same in the year and there is no change as the same were from starting and at the time of granting Registration u/s 12A (Copy of IT return and audited accounts enclosed (PB 49-68) 2.4 It is not necessary that the education can only be granted in school colleges and in class rooms. The books which is used in study in school, college and other palaces is also part of education. The meaning of education should be used in deep sense not in narrow it is wide Without books no course and education can easily possible or provided. As such the activity of the assessee trust are in the nature of educational. The AO has not appreciated the nature of the activity of the assessee trust in their true perspective and sense. 2.5 The activities of the Academy cannot be construed to be one of trade, commerce or business but it would only be as ed....
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.... the substantive amount out of receipts of Rs. 1,81,44,567/-, Rs. 1,24,10,000/- is received by the assessee from State Government by way of subsidy. Even if, name of the Institution i.e, Rajasthan Hindi Granth Academy is considered , it is established that it is for the purpose of publication of Hindi i.e for education. In that view of the matter, in our considered opinion, in vew of decisions referred by Mr Ranka, this is an educational institution activity. In that view of the matter, we are of the opinion that this academy is running only with a view to publish educational books and we have no hesitation in accepting the submissions of Mr. Ranka that this is only for the purpose of academy which is educational in nature. 12. In that view of the matter, the assessee will be entitled for the benefit u/s 10(23)(iiiab). Even from the table, looking to the turnover, the profit is negligible, therefore, it is clear that the institution has no profit motive. 13. In view of the above, the issue is required to be answered in favour of the assessee and against the department." 7. he ld. DR is heard who has relied on the findings of the lower authorities and d....
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....case may be, during the relevant previous year; or The ld. DR from the accounts of the assessee submitted the law for the year under consideration is required to be seen based on the financial performance of the assessee. In this year as it is evident that the assessee is not doing activity wholly and substantially for the purpose of the education activity and has earned substantial amount of the profit as it is evident from the receipt and payment account submitted by the assessee which is against the provision of the Act. The ld. DR also submitted that the assessee is not conducting any exam and merely publishing the books and that too on profit and therefore, the denial of the benefit by the lower authority is relied upon. In the earlier year the fact was different and in this year the profit is higher the benefit cannot be granted. Relying on the balance the ld. DR submitted that there is substantial amount of the money accumulated in the balance sheet and major part of the assessee trust is interest income this shows that the assessee is working for the profit motive and therefore, considering the definition given in the law the finding of the lower authority should be conf....