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2019 (4) TMI 194 - ITAT DELHIExemption u/s 11 - charitable activity or not? - Disallowance of boarding expenditure - use of hotel for residential accommodation for students with catering services - No allegation of excessive payment - No violation of section 13 - No violation of section 2 (15) - HELD THAT:- For provision of services, assessee has engaged Mars catering services, which is also part of Mars enterprises. There is an agreement also of assignment of original agreement from Mars enterprise to Mars catering services private limited. Expenditure has been incurred by assessee only for purpose of educational facilities to be given to student of lodging and boarding for staying in Mussoorie and studying in the assessee society. It is not denied or can be disputed that assessee is providing education to students and lodging and boarding facilities are incidental to education. No violation of section 13 has been pointed out by learned AO. It cannot be said that expenditure incurred by assessee is not for purpose of education. For all these considerations as stated above learned CIT-A has deleted addition. Merely because some celebrities are holding shareholding in one of entities to which assessee society has engaged for provision of services does not make any difference in allowance or disallowance of a particular expenditure for object of society. Merely because a hotel is rented by assessee society for using, as a hostel for student, does not make any difference, as far as student of the society exclusively uses the same. These facts do not exclude assessee from provision of section 2 (15). It is also not the case of AO that assessee is carrying on business activity, which is tainted with profit motives and is not an educational activity. The AO in this appeal does not dispute further repair expenditure of such hotel used as hostel by assessee. Hence, we do not find any infirmity in order of learned CIT – A in disallowing above claim. - Decided against revenue Defect in Form 36 - Appeal of revenue does not deserve any merit even for admission. By looking at form number 36 it is apparent that learned assessing officer has mentioned respondent as “Oil and natural gas Corp Ltd, Dehradun.” Here respondent is not ONGC but Woodstock school, Mussoorie. As AO wrongly shows respondent, and form number 36 is wrongly filled up, on this issue, defect notice was also issued to LD AO at time of filing of appeal. Registry of tribunal has mentioned this defect in notice itself on 14/07/2014. It is also surprising that learned assessing officer has filed this appeal in 2014, until 2019, no attempt has been made to even correct mistake. However, until now learned assessing officer has not even carried to correct error. Such callousness and carelessness on part of assessing officer who filed appeal shows complete non-application of mind. - Decided in favour of assessee.
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