TaxTMI 
TaxTMI 
TaxTMI 
1985 (7) TMI 135
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....erms and conditions as the trustees may deem fit or without any terms and conditions. III. To open, establish, maintain or support hostels and/or boarding houses and grant free or concessional boarding and lodging to students without any distinction of caste, creed, religion or sex studying in schools, colleges, vidyapith or other educational institutions whatsoever. IV. To give and grant monetary assistance to students or research scholars or workers either by way of scholarship, grant or loan or otherwise studying or working in schools, colleges, vidyapith, or other educational institutions or organisations whom the trustees may deem to be deserving thereof to enable them to receive such education and training and qualifications as the trustees may approve. V. To give or supply or distribute books, food, clothes, and other requirements of life and/or give school, college or tuition fees to poor or deserving students or scholars or grant all monetary assistance to them for the aforesaid purposes. VI. To promote education, research, and learning in all its branches. VII. To organise a comprehensive service and provide facilities which will help students, teachers, professional....
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....r such part of the income thereof for all or any of the aforesaid objects of this trust insofar as these objects relate to anything done or to be done within the taxable territories as defined in the Income-tax Act, 1961, or any statutory modifications or re-enactment for the time being thereof in force. " It was claimed before the ITO in the course of the assessment proceedings that the activities of the assessee-trust entitled the assessee-trust to claim of exemption under section 10(22) of the Income-tax Act, 1961 ('the Act') or alternatively under section 11 of the Act. The ITO, however, held that the assessee was conducting programmes for training in which the participants were only from a few limited companies, which had made donations for the purpose and this cannot be said to be either religious or charitable or even an object of general public utility. Another objection of the ITO was that clause IX of the objects of the trust deed, which was to organise a service and an information bureau for assistance to foreign students and scholars visiting India and to Indian students and scholars going abroad and clause XIII of the objects clause V to arrange exchanges of individua....
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....ceding assessment year. Proceeding further Shri Patel submitted that even for the assessment year 1977-78, the so-called income of Rs. 31,621 could not have arisen to the assessee-trust but for Rs. 30,255.70 collected for the course conducted in collaboration with the Iran Centre of Management Studies for which the Iran Centre of Management Studies waived their charges considering that the assessee-trust was a charitable institution. It was pointed out by Shri Patel that the assessee-trust was registered under the Bombay Public Trust Act, whose accounts were being regularly audited as required by law and where there was no possibility of the funds being misused for any personal needs of any of the trustees. Coming to the activities of the assessee-trust, Shri Patel mentioned that the main activities of the trust were counselling of Indian students who wanted admission in institutions abroad for which purpose the assessee-trust was also conducting some of the entrance examinations on behalf of the foreign institutions in order to save the Indian students the botheration of having to go abroad for entrance test and for all these services the assessee-trust charged a nominal amount, w....
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.... that the assessee is an institution/fund established in the taxable territories for a charitable purpose, it satisfies the requirements of section 80G and any sum within the prescribed limits paid by an assessee as donation to this institution/fund will be exempt under sub-section (1) of section 80G. Proceeding further he submitted that the objects of the trust were not only to help students get placements in institutions abroad and organise management courses in collaboration with foreign institutions but also undertake host of other activities for the benefit of the general public without distinction of caste, creed, religion, etc. In this connection he pointed out that apart from giving information to Indian students desiring placement in foreign institutions and even conducting admission tests for them on behalf of foreign institutions, in some cases, the assessee-trust was also providing financial assistance to needy students so that the students of merit, who could not afford these studies, were not denied the benefit of higher education. He then referred to the ruling of the Hon'ble Supreme Court in the case of Addl. CIT v. Surat Art Silk Cloth Mfrs. Association [1980] 121 ....
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....ddl. CIT v. Victoria Technical Institute [1979] 120 ITR 358 wherein even the activity to impart or assist in imparting instructions to persons in scientific or artistic principles which underlie the industrial and commercial occupations of the people as well as instructions in the manual and other practices involved in the application of such principles, etc., did not amount to the society carrying out such activities being an educational institution or having its objects as education. He, therefore, vehemently argued before us that the assessee's claim of being an educational institution or being an institution for educational purposes and, consequently, being entitled to the exemption as laid down under section 10(22) was not admissible and could not be allowed. 6. Shri Vohra then referred to the assessee's next claim of exemption as laid down under section 11. He submitted that the activity was to invite business management experts of international renown for programmes in India in which participants belonged to companies, who contributed to the cost of those programmes, i.e., in other words, this was an activity of a commercial nature. Proceeding further he submitted that even....