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2017 (12) TMI 1475 - ITAT JAIPURExemption u/s 10(23C)(vi) withdrawn - undue benefit to one person - expenditure incurred on this tour of group of teacher along with Director - payments as remuneration paid to the persons for rendering services and not merely payments for being the specified persons - Held that:- When the qualification and experience of the persons who were managing the affairs of the society and also involved in the day to day affairs and teaching work is not denied then salaries and allowances or remuneration paid to these persons cannot be held as unreasonable or excessive. Thus we hold that the payment is made on account of salary against the services rendered by these persons and not merely on account of their status then the same cannot be said to be a undue benefit to attract the provisions of Section 13(3) of the Income Tax Act. Except one person,all others are the teachers of the assessee society and not falling in the category of specified persons as per section 13(3). When the expenditure was incurred for the tour of the entire group then it cannot be considered as undue benefit only one i.e. Director. It is not a case of the Department that all 23 persons are falling in the category of the specified persons. We find that only the Director namely Shri Vaibhav Singh was considered by the ld. CIT(E) as specified persons while raising the objection of payment of salary. Therefore, out of the group of 23 persons, the Director cannot be picked out to invoke the provisions of section 13(3) of the Income Tax Act. Further it is not the finding of the ld. CIT(E) that the tour was undertaken for their personal trip then the education tour by the teaching staff along with the Director has to be considered as one event and expenditure. Hence, we are of the view that the expenditure incurred on this tour of group of teacher along with Director cannot be held as undue benefit to one person. In view of the above facts and circumstances of the case as discussed above the impugned order passed by the ld. CIT(E) is set aside and consequently the approval u/s 10(23C)(vi) granted to the assessee is restored. - Decided in favour of assessee.
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