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2012 (11) TMI 348 - ITAT HYDERABADExemption u/s. 11 - denial of claim as sum had been paid to founder members out of the corpus fund - Held that :- The amount was paid to the non-founder members on account of a dispute between the assessee society and them and there was a practical problem to keep these recipients of the amount within the committee of office bearers and the situation so warranted that had the assessee not paid this amount, the society could not have continued affecting the interest of larger number of students of the assessee. Being so, the assessee refunded this portion of money contributed by these two persons, and that refund of money cannot be considered as a benefit given to these persons - The fact whether defaulting office bearers are the founder members of the assessee trust or not has to examined. Regarding allowability of exemption u/s. 10(23C)(iiiad)/(vi) there is no allegation that the assessee is not imparting education. Firstly, there is no evidence that such benefit has been given to the founder member of the trust. Secondly, even if it is so, such instances would only hit the case of the assessee within the meaning of sections 11 to 13 and cannot be imported to deny exemption u/s. 10(23C)(iiiad) provided a clear finding on the basis of material on record is given that the assessee trust is not solely for the purpose of imparting education. Some disallowances of expenses or payments claimed by the assessee cannot be held to be a separate object for which the trust is existing thereby holding that the trust is not existing solely for education purposes. Mere certain lapses and disallowances cannot become basis for denying exemption u/s. 10(23C)(iiiad) - matter is restored to the file of the AO to have a fresh look on the entire subject - in favour of assessee for statistical purposes.
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