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2020 (10) TMI 713 - AT - Income TaxExemption u/s 11 - charitable activity u/s 2(15) - extra fees collected over and above prescribed fees - AO further noted that the notwithstanding the fact that the surplus of funds arising out of receipts from students are utilized for expansion of infrastructure by the Trust, for carrying of educational activities cannot be considered solely for charitable purposes being education but for commercial activities where education is sold for a price - HELD THAT:- Undisputedly, assessee trust enjoys registration u/s.12AA of the Act and it is also not a case of the AO that the activities of the assessee are not in accordance with its objects stated in the trust deed or assessee is doing or conducting any activities beyond its objects which is in the nature of commercial activities for profit motive. In view of interim orders passed by Hon’ble High Court of Orissa, no hesitation to hold that the Hon’ble High Court has allowed the assessee to retain extra amount of fees from prescribed limit till disposal of writ petitions. Even if assessee does not succeed in the said writes, then also, excess or extra charged fees has to be adjusted towards the fees of the respective students from whom it has been collected during completion of their courses. We refrain from making any observations regarding allegation of the AO about charging of extra fees from prescribed limit as the issue is pending for adjudication before the Hon’ble High Court of Orissa in the respective writ petitions filed by the assessee. Therefore, benefit of section 11 of the Act cannot be denied to the assessee only on the allegation of charging of extra fees from prescribed limit by taking respectful cognizance of the interim orders of Hon’ble High Court of Orissa. Denial of benefit of section 11 is not correct and sustainable. Consequential disallowance of salary paid to Mrs Sujata cannot be held as justified and sustainable. - Decided in favour of assessee.
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