TMI Blog2013 (11) TMI 1594X X X X Extracts X X X X X X X X Extracts X X X X ..... and to avoid tax liability to have benefit of exemption, but that is a question of fact. The court has to decide on the material available on record, whether the said provision is abused in the aforesaid manner or not. In the absence of any material to show that the said provision is abused and if it is demonstrated that the educational institution has collected money in the form of voluntary contributions from public and may be from the parents of the students who are studying in the institution and when they have issued receipts acknowledging the said amount towards building fund and made requisite entries in the books and deposited the same in the bank, if the court is satisfied with the genuineness of the transaction, it is well within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses which is owned by the assessee trust. It is also making use of the assets of the trust for the purpose of education. 3. The assessee has collected donations from various persons and also issued receipts showing that the said amounts were received towards building fund. Therefore, they claimed exemption under Section 11 of the Act. The Assessing Officer denied the exemption on various grounds. He treated the said income from donations as taxable income and added under section 68 of the Act on the ground that the assessee was not able to give the particulars of the persons, who donated the amounts and brought the said donations to tax. 4. In appeal by the assessee, the First Appellate Authority held that the assessee is a public ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... five different years. 5. Learned counsel for the revenue assailing the impugned order contended that to get an order of exemption under Section 11 as a corpus fund, the assessee has to establish that the said voluntary contributions are made with a specific directions that they shall form part of the corpus fund of the trust or institution and then only the assessee is entitled to the benefit thereof. The material on record discloses that though donations are received by the assessee and receipts are issued, the assessee is not able to demonstrate who those donors are and what is the direction they have given and in the absence of these material particulars, merely because a receipt was issued showing that the amount was received towar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 21,46,033/- received by the assessee would not be brought to tax under section 68 of the I.T. Act as the assessee failed to disclose the names of the donors and further held that the said donations are utilized as corpus towards building fund? (b) Whether the Appellate Authorities were right in not taking into consideration the fact that the building had not been utilized by the assessee for running the school but the same has been let out for other society and thereby charitable activity being not conducted by the assessee to claim exemption in respect of the donations of ₹ 21,46,033/-? 7. Learned counsel for the revenue fairly submitted that it requires reframing and accordingly the only substantial question o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the amounts given for the building purpose, i.e., it was given towards the corpus of the trust. The reasons given are that the particulars of the donors are not mentioned and hence, the assessee is not able to give the full particulars of the donors. There is nothing to show that these donors have given any specific directions to utilize the fund as a part of the corpus of the Trust. The amount involved in few lakhs for each year. The assessee is running an educational institutions and if philanthropic persons voluntarily donate funds for educational purpose and they have paid it by way of cash, the assessee has received the same and issued a receipt acknowledging the said amount. After receipt of the said amount, an entry is made in the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avoid tax liability to have benefit of exemption, but that is a question of fact. The court has to decide on the material available on record, whether the said provision is abused in the aforesaid manner or not. In the absence of any material to show that the said provision is abused and if it is demonstrated that the educational institution has collected money in the form of voluntary contributions from public and may be from the parents of the students who are studying in the institution and when they have issued receipts acknowledging the said amount towards building fund and made requisite entries in the books and deposited the same in the bank, if the court is satisfied with the genuineness of the transaction, it is well within the pow ..... X X X X Extracts X X X X X X X X Extracts X X X X
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