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2013 (7) TMI 367 - HC - Income TaxExemption u/s 10(23C)(iv) - Assessee society running inter college - Amendment made in Petitioner's object clause - CIT rejected claiming that society has not been formed with the sole object of imparting education, but its memorandum of association reflects that it has other aims and objects as well - Held that:- petitioner society is registered charitable society with the Registrar of Societies and is also registered under Section 12A with its objects of establishing, running and maintaining educational institutions. It has a school by the name of C.P. Vidya Niketan Inter College. At present the society does not have any activity other than running and maintaining educational institutions - There are adequate safeguards, that if the activities other than educational activities are undertaken, the exemption may be withdrawn, but in the absence of any such allegation it cannot be said merely on the enumeration of the activities, which are all primarily connected with education and charity that the society does not exist solely for the purpose of imparting education - in the absence of any allegation or material, the object clause providing for other charitable activities, would not disentitle the society from approval under Section 10 (23C) (vi) of exemption - mere possibility, that the society may in future pursue activities, which are not charitable, or closely connected with education for making profit, would not constitute the grounds to reject the approval under Section 10 (23C) (vi) - Following decision of AMERICAN HOTEL & LODGING ASSOCIATION EDUCATIONAL INSTITUTE Versus CBDT & OTHERS [2008 (5) TMI 17 - SUPREME COURT OF INDIA], Vanita Vishram Trust v. Chief Commissioner of Income Tax & Anr. [2010 (5) TMI 102 - BOMBAY HIGH COURT] and EWING CHRISTIAN COLLEGE SOCIETY Versus CHIEF COMMISSIONER OF INCOME-TAX [2009 (5) TMI 103 - ALLAHABAD HIGH COURT] - Decided in favour of assessee. Principal of natural justice - Held that:- Chief Commissioner of Income Tax did not give sufficient opportunity to the petitioner, to place documents relevant to the enquiry before rejecting the application - when the petitioner was required to produce the audit report under Rule 16CC in Form 10BB, and the petitioner was granted time to furnish the same within three days - there was no hurry to close the enquiry in as much as the rejection of the application will visit serious consequence on the petitioner in as much as having exceeded the aggregate receipts over and above Rupees One crore, the income of the society in the absence of the exemption under Section 10 (23C) (vi) would not qualify for exemption.
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