TMI Blog2012 (12) TMI 529X X X X Extracts X X X X X X X X Extracts X X X X ..... d above the prescribed fee for the admission of students, the assessee would be entitled for exemption under S.11, even though the notification under S.10(23C)(vi) have not been received by it - in favour of revenue by way of remand. Depreciation claim denied - Held that:- AO directed to verify in respect of each asset on which depreciation claimed, whether the value of such asset was in fact allowed under S.11, and if it was so allowed, the depreciation would not be allowed in respect of such asset - Impugned order of the CIT(A) set aside and the matter restored to the file of the AO for fresh consideration - in favour of revenue by way of remand. Unrecorded capitation fees collected from the students admitted under the management qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he I.T. Act. 3. Whether the CIT(A) erred in appreciating the fact that section 10(23C) as such is not a replacement of Sec.10(22) and (22A) but only sub-clauses (iii)(ad) and (iii)(ac) are replacements of the erstwhile Sec.10(22) and 10(22A) respectively. 4. Whether the CIT(A) erred in appreciating the fact that it was sec.10(22) that provided for exemption of the educational income of the Trusts, Societies etc. and not Sec.11. 5. Whether the CIT(A) erred in appreciating the fact that the purchase of capital asset that could be used to promote the objectives of the systems run by the trust is allowed as application of income. Therefore, the depreciation is not allowable on the capital asset where entire cost of acquisition is either ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad Bench of the Tribunal in Director of Income-tax(Exemption) V/s. Vasavi Academy of Education in ITA No.1449/Hyd/2008, vide order dated 4.2.2010, has held that an educational institution is entitled for exemption under S.10(23C) or under S.11, if no donation was collected from the students. We being in agreement with the order of the coordinate Bench of the Tribunal in the case of Vasavi Academy of Education (supra), direct the assessing officer to verify the aspect of donation, capitation fee etc. if any collected by the assessee, and further direct that if it is found that besides fulfilling other prerequisites for exemption under S.11, the assessee has not charged any money by whatever name it is called, i.e. donation, building fund, au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. The next issue involved in these appeals relates to the addition made on account of depreciation claimed by the assessee. The Assessing Officer has observed that the trust had claimed expenditure on account of depreciation. He was of the view that since the purchase of capital asset used to promote the objective of the trust is allowed as application of income, depreciation is not allowable on capital asset where the entire cost of acquisition is either written off in the first year itself or the cost of acquisition is treated as application of income. The Assessing Officer has drawn support from the decision of the Apex Court in the case of Escorts Ltd. (199 ITR 44). The CIT(A), on appeal, has allowed the claim of the assessee. Against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted to verify in respect of each asset on which depreciation claimed, whether the value of such asset was in fact allowed under S.11, and if it was so allowed, the depreciation would not be allowed in respect of such asset. Only if the value of the asset was not allowed as expenditure under S.11, the Assessing Officer is required to allow depreciation thereon, as per the rate applicable to those assets, as held in the case of Mahila Sidh Nirman Yojna, cited supra. On this issue raised by the Revenue, impugned order of the CIT(A) for the years under appeal, is set aside and the matter is set aside to the file of the Assessing Officer for fresh consideration, in the light of the above observations. The Assessing Officer shall accordingly rede ..... X X X X Extracts X X X X X X X X Extracts X X X X
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