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2019 (9) TMI 809 - AT - Income TaxExemption u/s 11 - charitable activity u/s 2(15) - carrying on the activities of establishment of educational institute for strengthening the cause of education by providing the didactical (designed or intended to teach) facilities etc. - HELD THAT:- The assessee is carrying on object of establishing and helping universities, colleges, schools and other institutions for strengthening the cause of education by providing didactical facilities provide consultancy support in the area of educational planning and administration for opening, diversifying and developing the existing or new institutions. It also provides mutual and technical cooperation for implementing and supplementing for establishment of universities. It has entered into an MOU with the Global Open University, Nagaland for helping the university in the areas of instructional material and resource development, research design, publications and collaborative programme development. As assigned duty of preparation and publication of study material including its distribution to the students from time to time. It was also helping in coordinating the development activities of the universities. The trust has appointed 200 teachers who guide the students in studying course material and their queries of study material. It also helps the students in preparation for examination. Such facts are stated before the ld AO per letter dated 08.06.2016. The assessee also submitted the details of course material expenses of ₹ 72.37 lakhs, which was for the course material, it can be said to be an educational activity or not. Admittedly, in the earlier years the claim of the assessee is accepted. The issue is discussed in case of DIT Vs. The Delhi Public School Society [2018 (4) TMI 714 - DELHI HIGH COURT] , wherein, the issue is examined that when the assessee is carrying out opening and running around 120 schools through franchise agreement and franchise charges received with the assessee for using the name of Delhi Public School by the satellite schools in and outside India and assessee earned franchisee fees is an educational activity or business activity. The memorandum of association of DPS society as well as the joint venture agreement entered by DPS society with the satellite schools is having motive of an educational purpose. It is an educational activity which qualifies as a charitable purpose within the meaning of section 2(15) of the Act. It further held that the objected activity were an activity incidental to the dominant educational purposes. Further, in ITO (E), TRUST WARD II, DELHI VERSUS SOCIETY FOR ESSENTIAL HEALTH ACTION & TRAINING [2014 (3) TMI 101 - ITAT DELHI] for Assessment Year 2009-10, the coordinate bench also held that when a trust entered into an agreement with the assessee society in providing research services is also engaged in charitable purpose even if it incidentally involves the carrying on of commercial activity. Admittedly, the assessee is also receiving examination fees, conducting such examination, providing help to the university, and incurring expenses on them. Admittedly, it is not shown by the ld AO that the revenue surplus generated by the assessee is not utilized for the purposes of educational activities. Thus, prima facie assessee is carrying on the educational activities and not the business as facilitator. Accordingly, orders of the lower authorities are reversed and appeal of the assessee is allowed.
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