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2014 (5) TMI 774 - AT - Income TaxScope of term charitable purpose u/s 2(15) of the Act – Educational institution - scope of imparting education - to pursue educational activities - improvement of educational standard of science students by making available superior course material and methodology for examination in this behalf – Held that:- Assesses books of accounts are audited and upheld by AO - No discrepancy or question about genuineness of the books and affairs of the assessee have been called into question - In earlier assessments u/s 143(3) assesses activities have been held to be educational and charitable activities and benefits of sec 11 have been allowed to the assessee - Registration u/s 12A has not been withdrawn – assessee demonstrated that nature of its educational activities, modalities of working, methodology of affiliation with CBSE and other Boards, fee structure, examination pattern remain same as in earlier year - AO has taken a divergent view on the assessee educational activities by holding that they are no more educational activities as regular classes are not held – Relying upon COUNCIL FOR THE INDIAN SCHOOL CERTIFICATE EXAMINATIONS Versus DIRECTOR GENERAL OF INCOME TAX [2012 (3) TMI 289 - DELHI HIGH COURT] - assessee though being only in conducting examinations is still to be regarded as educational institution. Also in Assam State Text Book Production and Publication Corporation Limited Versus Commissioner of Income Tax, Gauhati-I [2009 (10) TMI 60 - SUPREME COURT] it has been held that board though being only in the publication of books falls within the meaning of educational institution - It is not necessary to hold regular classes to be regarded as an educational institution – in AMERICAN HOTEL & LODGING ASSOCIATION EDUCATIONAL INSTITUTE Versus CBDT & OTHERS [2008 (5) TMI 17 - SUPREME COURT OF INDIA] publication of curriculum, reproduction of text books, faculty development programmes are to be held as educational activities. There was no merit in the order of AO to give a restricted meaning to the scope of meaning of term educational activities - AO's necessity of holding of regular classes or wholesome educational activities to be only eligible to be called educational activities eligible for benefits u/s 11 cannot be sustained - a charitable or educational institution can charge fees for rendering services, it is so as the surplus is accumulated which is further to be applied for charitable objects of the institution - in case of winding up, surplus has not dwell upon shareholders or relatives - the AO’s allegations in this behalf cannot be sustained - adverse inference drawn by AO is without any basis – thus, the order of the CIT(A) is upheld – Decided against Revenue.
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