TaxTMI 
TaxTMI 
2010 (12) TMI 1374
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....engineering disciplines. As the Trust is running educational institutions, it claimed deduction u/s.10(23C) of the Income Tax Act, 1961. 3. The assessee was also enjoying the exemption provided u/s.80G(5)(vi). In the above background, the assessee has made an application for renewal of exemption granted u/s.80G. The Commissioner after verifying the necessary details and particulars came to the conclusion that the assessee is collecting fees from the students and in that way, assessee is engaged in commercial activities, which are not covered by Sec.11(1)(a) of the Income Tax Act. The Commissioner of Income Tax further held that the expenditure incurred by the assessee's trust related to commercial activities and therefore fall under sections 11(4)(a). While holding so, the Commissioner also did not consider the capital expenditure incurred by assessee in carrying on its activities. The application was accordingly rejected. The assessee is aggrieved and therefore, the appeal is before us. 4. Shri T. Banusekhar, learned Counsel appearing for the assessee's trust contended that the Commissioner of Income Tax has failed in not considering the crucial aspect of assessee's case tha....
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....25,000/-. The assessee had donated Rs..50,000/- and another amount of Rs..20,000/- to the General Secretary of DMK, a political party for which receipts were not available. The Commissioner has pointed out that these donations could not be treated given for charitable activities. But whether these donations might have been incurred in facilitating the running of the charitable activity, has not been considered. The remaining donations were made by the assessee trust to Dr.G.Gengusamy Matriculation School, Thiruvengadam, Anna University Calamity Relief fund, etc. That fund enjoys the benefits of Sec.12AA & Sec.80G of the Income Tax Act. Grievance of the Commissioner is that the two schools do not have such registration or benefit. We do not find force in the objection raised by the Commissioner. There is no rule that the beneficiary school also should have registration/benefit of exemption under Section 80G of the Income Tax Act, 1961. In their case, those issues may arise, if otherwise, they are liable to be income tax assessee. The nature of the donations has to be looked into in view of the activities carried on by the donees. Both the donees are schools. The assessee trust itsel....
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....renewal of exemption u/s.80G. We direct the Commissioner of Income Tax to grant exemption as prayed for by the assessee trust. 11. Next, we will consider the appeal filed by the Revenue for assessment year 2007-08. The assessee trust has obtained registration u/.12AA, but the Assessing Officer has denied the benefits of Sec.11 to the assessee trust for the impugned assessment year on various grounds enlisted by him in the assessment order. In the light of a survey carried out in the premises of the assessee trust, there was a direction to the Assessing Officer to examine the claim of exemption u/s.11 made by the trust. On the basis of the discussions made in the assessment order, the Assessing Officer held that the assessee is engaged in commercial activities and therefore, the benefit of Sec.11 would not be granted. He also made mention like the absence of identification of donations as corpus donation or not. Other defects in the books of accounts mainly related to expenditure. The benefit of Sec.11 was thus denied. 12. In the first appeal, the CIT(A) found that the assessment was framed in the light of the directions of the Additional Commissioner of Income Tax u/s.144A, i....
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.... not. Whether the trust is for charitable purpose or not, is to be determined on the basis of the objectives for which the trust has been brought into existence. In the present case, the main object of the trust is to establish, maintain and take over educational institutions. The Assessing Officer has not pointed out any violation in carrying out the above objects of the assessee trust. The CIT(A) held that the assessee has satisfied the conditions of exemption provided u/s.11(1)(a). That the income of the trust has been applied for charitable purposes; the property has been held wholly for charitable and the income has been applied in India. He accordingly granted exemption to the assessee u/s.11 and directed the Assessing Officer to delete the total income assessed in the hands of the assessee. 15. On hearing both sides, we find that the CIT(A) is justified in his finding and his direction. Assessee trust has been running educational institutions since long in the past. There is no case for assessing authority that the assessee trust is carrying on any other business or non-educational activities. There is no rule or law that a charitable educational institution should not co....