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2024 (3) TMI 482 - HC - Income TaxExemption u/s 10 (23C) (vi) - generation of surplus from year to year - exemption denied as surplus being generated is not incidental to educational purposes - HELD THAT:- This Court observes that the Ministry of Finance, Department of Revenue, Central Board of Direct Tax issued a Circular bearing No. 14/2015 (F.No.197/38/2015-ITA-I) dated 17.08.2015, stating therein that representations have been received seeking clarification on certain issues relating to grant of approval and claim of exemption u/s 10 (23C) (vi) and vide the said circular, it was clarified that the mere generation of surplus from year to year cannot be a basis for rejection of application under Section 10(23C) (vi) of the Act of 1961. The petitioner is claiming that it is being run as a Trust solely for educational purposes, and thus, seeking the exemption under Section 10 (23C) (vi) of the Act of 1961, and the generation of surplus from year to year cannot be bar in seeking such exemption under the said provision of law. This Court further observes that after the judgment rendered by the Hon’ble Apex Court in case of Queen’s Educational Society [2015 (3) TMI 619 - SUPREME COURT] and issuance of the aforementioned clarificatory Circular, the case of the present petitioner needs to be duly considered by the respondents. Thus, in light of the aforesaid observations and looking into the factual matrix of the present case, particularly, the precedent of Queen’s Educational Society (supra) and the aforementioned clarificatory circular, the present petition is partly allowed; accordingly, while quashing and setting aside the impugned order matter is remanded back to the respondents with a direction to re-consider and decide the application in question preferred by the petitioner under Section 10 (23C) (vi).
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