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2019 (5) TMI 1642 - AT - Income TaxExemption u/s 11 - charitable activity or not? - activities of the assessee is to facilitate accreditation and continuing supervision through inspection and charging inspection and accreditation fees from various organizations - why its receipt from fees subscription should not be hit by Proviso of section 2(15) ? - HELD THAT:- The main objectives of assessee society for assessment and accreditation carried out by the assessee society, the same are to assess and grade colleges and/or institutions of technical and professional education, the courses and programs offered by them, their various units, faculty, department etc.; to stimulate the academic environment and quality of teaching and research in the institutions; to make contribution to the sphere of knowledge in its discipline; to motivate colleges and/or institutions of technical and professional education for research, and adopt teaching practices that groom their students for the innovation and development of leadership qualities; to encourage innovations, self evaluation and accountability in higher education; to promote necessary changes, innovations and reforms all aspects of the working of the colleges/ institutions of technical and professional education for the above purpose; and to help institutions realize their academic objectives; it leads to the conclusion that the assessee society is into charitable activities, the objectives being incidental to the education. Whether receipts of the assessee from fees/ subscription are hit by Proviso to section 2(15)? - HELD THAT:- When the assessee society is receiving receipt of fees/ subscription as per norms laid down by Government of India, profit motive is not visible rather all the activities are centered around disciplining, promoting, improving and contributing to similar academic environment and quality of teaching and to enhance the knowledge and discipline of the educational institutions which are incidental to the education and cannot be kept under the objects of general public utility. Further examine the activities being carried out by the assessee society in the light of the fact that in the immediately preceding year i.e. AY 2012-13, assessee has been duly granted exemption u/s 11 by framing assessment u/s 143(3). Undisputedly, there is no change in the aims and objectives of the assessee society which are being carried out in accordance with the Memorandum of Association and Certificate of Registration under Societies Registration Act dated 07.01.2010. There is not an iota of material brought on record by AO if the facts of the year under assessment are distinguishable from AY 2012-13. In these circumstances, rule of consistency as laid down in Radhasoami Satsang vs. CIT [1991 (11) TMI 2 - SUPREME COURT] is applicable in this case. AO without proving on record that the activities of the assessee society are in the nature of trade, commerce or business proceeded to deny the benefit of section 11 which is not sustainable in the eyes of law. Rather assessee is carrying out its activities of accreditation as per All India Council for Technical Education (AICTE) Act, 1987 and there is no element of profit and as such First Proviso to section 2(15) is not applicable. We are of the considered view that CIT (A) has rightly allowed the exemption u/s 11 to the assessee by allowing the appeal. - Decided against revenue.
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