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2022 (10) TMI 894 - AT - Income TaxExemption u/s 10(23C) - unaccounted money was generated in podar Group and same was rooted through sham companies - HELD THAT:- According to the provision of Section 10(23C)(vi) any University or any Educational Institutions solely existing for education purposes and not for purposes of profit will have its whole of the income exempt. The proviso to section 10(23C) of the Act provides that if an educational institute applies its income on other than objects of trust or for the purpose of profit, it may lose exemption. Admittedly Ramrao Adik Education Society is also an educational institute, therefore, donation to that society cannot be said to be utilized by assessee for non-educational purposes. This fact has not been denied by the AO at any time. Thus it is not the case of the assessee that ₹1 crores given as a donation by the assessee is utilization of the fund for non-educational purposes. Even otherwise, the disallowance under Section 10(23C) made by the AO is pursuant to search dated 9 January 2018. The impugned assessment year before us is 2012-13. Only evidence based on which the ld AO held that Rs 1 Cr of Donation is not eligible for exemption u/s 10 (23C) are the statements of those persons. For this year, original assessment is already completed u/s 143(3) of the Act on 27 March 2014 therefore, it clearly shows that impugned assessment is a concluded assessment at the time of search. Such retracted statement also cannot be said to be incriminating material found during the course of search, which can be used to enhance the income of assessee u/s 153A of the Act. Thus , there is no incriminating material existing pursuant to search, which could have disturbed the concluded assessment in case of the assessee. Therefore, even on this ground, the exemption u/s 10(23C) cannot be denied to the assessee. Accordingly, ground of the appeal of the learned Assessing Officer is dismissed and order of the CIT (A) is confirmed. Gratuity and leave encashment provision - HELD THAT:- We find that assessee runs educational institute and makes provision for gratuity and leave encashment of the staff on actuarial basis, which is ascertained liability, and not merely a provision. Merely because it is stated to be a provision, it is not disallowable. Even otherwise, the issue is squarely covered in favour of the assessee by the decision of co-ordinate Bench in assessee’s own case for A.Y. 2014-15. In the result, ground no. 6 of the appeal of the learned Assessing Officer is dismissed.
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