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2013 (7) TMI 261 - HC - Income TaxExemption u/s 10(23C)(vi) - educational society - CIT rejected the application on the ground that collection of donations from pupils would amount to an act for the purpose of profit and therefore does not fulfill the objectives mentioned in Section 10(23C)(vi) of the Act. - Held that:- Petitioner having not explained the rules and regulations more appropriately, relating to the collection of donations from pupils contrary to provisions of Karnataka Educational Institutions (Prohibition of Capitation Fee) Act, 1984, coupled with the failure to explain, with material particulars, over the discretion to be exercised by the Executive Committee over such donations, no exception can be taken to the reasons findings and conclusions arrived at by the CCIT’s in the order Annexure-A. In the absence of explanation, it cannot be said that it is not the actual user but the likelihood and the capacity of the trustees to do so which is important, the exercise of discretion by the Executive Committee to put to use the donation is of primary concern - Following the decision of Reliance Motor Company Private Limited -vs- Commissioner of Income Tax [1994 (8) TMI 22 - MADRAS High Court] - Decided against the assessee.
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