Pragathi Nagar Educational Society, Hyderabad Versus DIT (E) Hyderabad - 2013 (10) TMI 1077 - ITAT HYDERABAD - Income Tax
......... n 11 or section 13, then, the profits of such institution would be taxable. Further the fact that, only 75 percent of the income is to be applied for charitable purposes itself shows that element of profit is not excluded from the definition of charitable purpose for the purpose of sections 11 and 12. Because some profit has been earned by an educational institution registration u/s. 12AA cannot be denied so long as provisions of sections 11, 12 and 12AA are complied with. So long as it is established that income of the assessee society has been applied for the purpose of education in terms of section 11(2) and there is no violation of section 13, the assessee would be entitled to enjoy the benefit of registration u/s. 12AA of the Act . 18. Respectfully following the decision in the case of M/s. Saivani Educational Society, Hyderabad (supra), we allow the assessee s appeal. 19. In the result, appeal of the assessee is allowed. Order pronounced in the open Court on 27.09.2013.