Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

The Commissioner of Income Tax, Rohtak Versus Jat Education Society, Rohtak

2015 (12) TMI 1071 - PUNJAB AND HARYANA HIGH COURT

Eligibility for exemption u/s 11 denied - CIT(A) held that the assessee was not eligible for exemption under Section 10(23C)(iiiab) - ITAT allowed assessee appeal holding that the institution/society run by the assessee had received substantial Government aid for the purpose of claiming exemption under Section 10(23C)(iiiab) - Held that:- In the present case, there has been financing by the Government when examined on individual institution basis to be ranging from 41% to 82% whereas when the pe .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

37.85% by the Government held the assessee to be entitled to eligible for exemption under Section 10(23C)(iiiab) - Decided against revenue. - ITA No. 133 and 140 of 2014 (O&M) - Dated:- 17-9-2015 - MR. AJAY KUMAR MITTAL AND MR. RAMENDRA JAIN, JJ. For The Appellant : Mr. Inderpreet Singh, Advocate For The Respondent : Mr. Pankaj Jain, Senior Advocate with Mr. Madhur Sharma, Advocate, Mr. Divya Suri, Advocate, Mr. Deepanshu Jain, Advocate and Mr. Sachin Bhardwaj, Advocate AJAY KUMAR MITTAL, J. 1. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the Tribunal ) in ITA No. 2543/Del/2011, relating to the assessment year 2007-08, claiming the following substantial questions of law:- a. Whether Hon'ble ITAT is justified in law in deleting the addition of ₹ 21,04,921/- made by the Assessing Officer by taxing the surplus as the assessee society viz. The Jat Education Society, which is the parent body of all the institutions, has not been granted registration u/s 12AA of the Act and thus was not eligible for exemption u/s 11; the Hon .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

aggregate receipts which fell far short of 'substantially' financed by the Government; the Hon'ble ITAT allowed the exemption u/s 10(23C)(iiiab) by relying upon the judgment of Hon'ble Karnataka High Court in ITA No. 1133 of 2008 wherein the grant of 34.33% was considered 'substantial' but the Revenue has not accepted this judgment and has filed appeal against the order in Hon'ble Supreme Court? 3. An application bearing CM No. 26348-CI of 2014 was filed by the learn .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

run by the assessee, by relying on an ispo facto erroneous non-contextual interpretation of the definition of the term 'Substantially financed by the Government' of the above section, by relying on unrelated statutory provisions of the Banking Regulation Act, 1949 and Section 40A(2)(a) of the Income Tax Act wherein the interpretation is qua an absolutely dis-similar fact of substantial interest of a person in a company or firm? 4. Put shortly, the facts necessary for adjudication of the .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d claimed exemption under Section 10(23C)(iiiab) of the Act on the entire income as per the return of income. Accordingly, the assessee was assessed at an income of ₹ 93,25,443/-. Feeling aggrieved, the assessee filed an appeal before the Commissioner of Income Tax (Appeals) [for brevity the CIT(A) ]. The CIT(A) vide order dated 10.3.2011 (Annexure A-II) dismissed the appeal holding that the assessee was not eligible for exemption under Section 10(23C)(iiiab) of the Act. Still dissatisfied .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e parties and perused the record. 6. After hearing learned counsel for the parties, in our opinion, the issue that arises for consideration in these two appeals is whether the Institution/Society run by the assessee received substantial contribution towards the corpus of the assessee or not so as to claim exemption under Section 10(23C)(iiiab) of the Act? 7. It would be expedient to reproduce clause (iiiab) of subsection (23C) of Section 10 of the Act which reads thus:- Income not included in to .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

existing for educational purposes and not for profit and is wholly or substantially financed by the Government is entitled to claim exemption from income tax under the Act. 9. Learned counsel for the assessee has relied upon the judgments of the Karnataka High Court in Commissioner of Income Tax v. National Education Society, ITA No. 808 of 2009, Commissioner of Income Tax v. Indian Institute of Management (2011) 196 Taxman 276 (Kar.) against which Special Leave Petitions have been dismissed by .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ssessee to be entitled to eligible for exemption under Section 10(23C)(iiiab) of the Act with the following observations:- 3. Learned counsel for the appellant assailing the impugned order contends that, admittedly, out of total receipt of ₹ 20.61 lakhs the grant from the Central Government is only ₹ 7.80 lakhs which works out to hardly 37.85 per cent. It does not exceed 50 per cent and, therefore, the assessee is not entitled to exemption. The Tribunal committed serious error in int .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

;substantial' portion of the finance have taken note of the statutory provisions contained in the Banking Regulation Act, 1949, where a person who has the beneficial interest of more than 10 per cent of the total capital subscribed by all the partners of the firm has been held to be having substantial interest. Similarly, 'substantial interest' has also been defined in Explanation to s. 40A(2)(a) of the IT Act, where a person who is having voting power of not less than 20 per cent in .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s substantial finance by the Government. 5. Applying the aforesaid law, in the instant case, the total income of the assessee from all sources is ₹ 20.61 lakhs. Out of which, a sum of ₹ 7.80 lakhs which represents only 37.85 per cent of the total income is financed by the Central Government, the other source of income being tuition fee, donations, etc. In that context, it is clear that this amount of ₹ 7,80,000/- given as grant by the Central Government to this assessee constit .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     bird's eye view     ↓  


|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version