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2015 (12) TMI 694

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..... or part of the activity of the society is training of DTC drivers from grants received from Ministry of Shipping, Road Transport & Highways, Govt. of India (MORTH). Indisputably, substantial activity of the assessee revolves around providing training to drivers of buses and trucks. The training programmes are designed/ approved by the Ministry of Shipping, Road Transport and Highways which also gives grants to the assessee society from time to time. As such, the assessee cannot be equated with a private drivers’ training institute. There is no finding by the Department that any benefit of any kind has accrued to any individual member involved in the activities or day to day running of the society. Therefore, in our considered opinion and respectfully following the ratio of the judgments as laid down by the Hon’ble High Court of Gujarat in Gujarat State Co-operative Union vs. CIT (1992 (2) TMI 74 - GUJARAT High Court) and the Hon’ble High Court of Delhi in Institute of Chartered Accountants of India and Another v. DIT (Exemptions) and Others (2013 (7) TMI 205 - DELHI HIGH COURT ) we find no reason to interfere with the impugned order of the Ld. CIT (A). - Decided in favour of assess .....

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..... nature of fees for rendering services. As discussed above the activity carried out by the assessee is commercial in nature and squarely falls under the limb 'advancement of any other object of general public utility' with reference to definition of 'charitable purpose' u/s. 2(15) of the IT Act, 1961. The aggregate value of receipts are more than 10 lacs, hence conditions stipulated in both the above mentioned provisions to section 2(15) stand satisfied and assessee is hit by the proviso to section 2(15). It is evident that the dominant activities carried on by the assessee have to be considered under 'advancement of any other object of general public utility' as per the definition of 'charitable purpose' contained u/s. 2(15) of the IT Act, 1961. From the fact mentioned above, it is gathered that the assessee is in receipt of fees from rendering services. In view of above discussion, irrespective of use of fee, charging of fee for rendering services will lead to invocation of proviso to section 2(15). Such activities are in nature activity of rendering any services in relation to any trade, commerce or business, for a cess or fee. Such business .....

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..... l be only a mask or a device to hide the true purpose which is trade, commerce or business or the rendering of any service in relation to trade, commerce or business. Each case would, therefore, be decided on its own facts and no generalization is possible. Assesees, who claim that their object is 'charitable purpose within the meaning of Section 2(15) would be well advised to enchew any activity which is in the nature of trade, commerce or business or the rendering of any service in relation to any trade, commerce or business. As no generalization is possible and each case has to be decided on its own merit, so, it is held that activities fall under the last limb, i.e., any other object of general public utility, but, relying on the ratio of the judgment in the case of Bureau of Indian Standards, as discussed above, it is held that its activity do not have element of trade, commerce or business. Accordingly, grounds No. 1,2 and 6 are allowed. Ground No. 3:-The appellant has taken the ground that its activity falls under the category of education. For this appellant has relied on the judgment of Hon ble Gujarat High Court in the case of Gujarat State Co-operative .....

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..... iness profit for charitable purposes is of no relevance due to amendment in section 2 (15). He submitted that the order of the Ld. CIT (A) should be set aside. 5. The Ld. AR on the other hand submitted that the concept of education has undergone a complete change. He emphasised that the case of assessee falls under education and not under object of general public utility . He submitted that the proviso to section 2(15) is not applicable to the assesseee s case at all. He placed reliance on the decision of the Hon ble High Court of Gujarat in Gujarat State Cooperative Union vs. CIT 195 ITR 279 (Guj). He submitted that in view of the judgment of the Hon ble High Court of Gujarat the assessee society is a purely educational society and the proviso to section 2(15) is not applicable to the assesee society. 6. We have heard the rival submissions and have also perused the records. A reference may be made at this juncture to the decision of Hon ble High Court of Gujarat in the case of Gujarat State Co-operative Union vs. CIT (supra) wherein the Hon ble High Court has dealt with the judgment of Sole Trustee, Loka Shikshana Trust v. CIT (1975) 101 ITR 234 in which the Hon ble Apex .....

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..... #39; in the context of the provisions of section 2(15) of the Act. It will not be proper to construe these observations in a manner in which they are construed by the Tribunal when it infers from these 'observations, in Para 17 of its judgment, that the word 'education is limited to schools, colleges and similar institutions and does not extend to any other media for such acquisition of knowledge. The observations of the Supreme Court do not confine the word 'education' only to scholastic instructions but other forms of education also are included in the word 'education'. As noticed above; the word 'schooling' also means instructing or educating. It, therefore, cannot be said that the word 'education' has been given an unduly restricted meaning by the Supreme Court in the said decision. Though, in the context of the provisions of section 10(22), the concept of education need not be given any wide or extended meaning, it surely would encompass systematic dissemination of knowledge and training in specialized subjects as is done by the assessee. The changing times and the ever widening horizons of knowledge may bring in changes in the methodol .....

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..... struction, training on simulator models, field instructions, practical training and examination. The fee to be recovered for different courses is determined and prescribed by the Transport Department. For each course certificate is awarded to the successful candidates on completion of the course which is signed by the Authorized Signatory of the Transport Department, Govt. Of NCT of Delhi, the Instructor the Principal of the Driving Institute. The certificate issued is the Statutory basis on which driving license and PSV Badges are issued/renewed by the Transport Authority. A major part of the activity of the society is training of DTC drivers from grants received from Ministry of Shipping, Road Transport Highways, Govt. of India (MORTH). Indisputably, substantial activity of the assessee revolves around providing training to drivers of buses and trucks. The training programmes are designed/ approved by the Ministry of Shipping, Road Transport and Highways which also gives grants to the assessee society from time to time. As such, the assessee cannot be equated with a private drivers training institute. There is no finding by the Department that any benefit of any kind has acc .....

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