TMI Blog2010 (1) TMI 807X X X X Extracts X X X X X X X X Extracts X X X X ..... of Income-tax directed to grant approval under section 80G of the Act accordingly, appeal allowed. - ITA No. 4485/Del/2009 - - - Dated:- 29-1-2010 - I.P. Bansal, B.P. Jain, JJ. P.D. Mittal, CA for the Appellant H.K. Lal, Sr DR for the Respondent ORDER B.P. Jain: This appeal by the assessee is directed against the order of the learned Commissioner of Income-tax, Faridabad, dated 09.10.2009 under section 80G of the Income-tax Act, 1961 read with Rule 11AA(5) of the Income Tax Rules, 1962. 2. Since the issue involved is identical, all the grounds raised by the assessee are taken together. Ground Nos. 1 to 4 read as under:- "1. That the Learned Commissioner of Income Tax, Faridabad has failed to apprec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egistered under the Societies Registration Act for imparting education to the children under the name and style as Rajmala Senior Secondary School at Gurgaon. The assessee had been granted registration under section 12AA of the Act. The learned Commissioner of Income-tax observed that the assessee had utilized/applied funds towards charity during the financial years 2008-09, 2007-08 and 2006-07 only 64%, 34% and 54% respectively of the gross receipts of the funds. The surplus has been utilized mainly on capital account. The expenses incurred on capital account does not constitute the application/utilization of funds for charitable purpose. The assessee has invested in construction of school building and purchase of capital assets mainly the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . We have considered the rival submissions and perused the material available on record. As regards depreciation the learned counsel for the assessee pointed out at Pages 27, 19 and 9 for the F.Y. 2006-07, 2007-08 and 2008-09 as per schedule of fixed assets, depreciation claimed at Rs.11,83,149/-, Rs.18,04,040/-and Rs.40,42,958/- respectively. In view of the decisions of various Courts of law where depreciation has been considered as application of income in the hands of charitable institutions i.e. in the cases of (1) CIT vs. Manilal Ranchholddas Vishram Bhawan Trust, 190 ITR 598 (Guj.); (2) CIT vs. Institute of Banking Personnel Selection, 264 ITR 110 (Bom.); and (3) CIT vs. Raipur Pallottine Society, 180 ITR 579 (MP). Therefore, the depr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding and its expansion during the said financial years and for acquiring the bus for carrying the children from and to school and home. The findings of the learned CIT that such capital expenditure is not an application or utilization of funds cannot be accepted since without having the building of the school or bus, it is not possible for the society to run the school. Therefore, said activity is well within the aims and objects of the assessee education society. Therefore, if the depreciation and such capital expenditure is deducted out of the gross receipts shown in the chart reproduced by the learned CIT(A) herein before, the surplus comes to a negative figure and therefore, it cannot be said that the assessee has accumulated any amount ..... X X X X Extracts X X X X X X X X Extracts X X X X
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