TMI Blog2016 (5) TMI 873X X X X Extracts X X X X X X X X Extracts X X X X ..... he actual receipt for the purposes of Section 10(23C)(iiiad) is to be earned out from the educational activity. The case law referred by the assessee are squarely applicable. We have considered view that the capital subsidy received from the State Govt. is not part of total receipts. The assessee wrongly claimed deduction U/s 11 as he did not have registration U/s 12AA of the Act but the ld Assessing Officer has to calculate the real income on the basis of material available with him and is duty bound to assess the correct income as per law. - ITA No. 61/JP/2015 - - - Dated:- 8-4-2016 - SHRI R.P. TOLANI, JM SHRI T.R. MEENA, AM For The Assessee : Shri Rajiv Pandey (CA) and Ms. Dakshayani Pandey (Adv) For The Revenue : Shri Raj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The ld Assessing Officer observed that during the year under consideration, the Trust had shown annual receipts of ₹ 28,59,012/- against the exemption of ₹ 43,59,428/- was claimed U/s 11 of the Act by the assessee and net deficit of ₹ 15,00,416/- was shown. It was noticed by the Assessing Officer that the assessee had received ₹ 1,23,90,976/- from Government of Rajasthan as subsidy which had not been shown in the income and expenditure account and aggregate annual receipt after including such amount becomes more than ₹ 1.00 core. Therefore, the ld Assessing Officer gave reasonable opportunity of being heard on this issue. Further he held that the assessee had claimed exemption U/s 11 of the Act. Return of incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee U/s 11 is not applicable as the assessee did not have registration U/s 12AA of the Act at the relevant period. After considering the assessee s reply, the ld Assessing Officer has held that the assessee had claimed these expenses U/s 11 of the Act but it does not have registration U/s 12AA of the Act. The subsidy received by the assessee from the State Govt. is includable in total receipts. It is further observed that as per object of the Trust, according to the deed, some of the objects are general, charitable in nature not for education purpose. Thus the assessee is not existing solely for education purpose. Therefore, in view of the above discussion, the alternative claim made by the assessee was also not found acceptable. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and therefore do not form part of the total receipts of the society. The other receipts of the society were less than ₹ 1 crore and therefore exemption u/s 11 of the IT Act was claimed. 4.7 It is further-stated that in the alternative the claim of the assessee may be allowed u/s 10(23C)(iiiad) of the IT Act because after excluding the above receipts of ₹ 1.23 crores, the gross receipts are less than ₹ 1 crore. Therefore, the claim of the society u/s 10(23C)(iiiad) of the IT Act may be allowed. The appellant has cited certain case laws to support its contentions. 4.8 Having considered the - material available on record, I find that the appellant has failed to apply and obtain registration u/s 12AA of the IT Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mption claimed u/s 10(23C)(iiiad) of the IT Act, 1961 by the appellant. 4. Now the assessee is in appeal before us. The ld AR of the assessee has argued that the capital Subsidy grant received from State Government of Rajasthan amounting to ₹ 1,23,90,976/- by the Appellant Society on construction of building, which was reimbursement of expenses and deducted by the Society from its assets has been treated as Revenue Receipt and included in calculation of total receipts for calculation of the exemption limit prescribed u/s 10(23C)(iiiad) of the Act by the lower authorities. The legislative intention is not to include capital subsidy grant but revenue receipt on account of tuition fee and other fee etc. The amount given by the Stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y Vs ITO (2013) 36 CCH 0609 Del Trib, (2013) 60 SOT 0050 (Delhi (URO). (iv) Dy. Director of Income Tax (Exemptions)-III Vs Madarasa EBakhiyath- US-Salihath Arabic College (2013) 37 CCH 0521 Chen Trib (2014) 62 SOT 0001 (Chennai). (v) Tolani Education Society Vs. ITO 351 ITR 184 and 327 ITR 121. The assessee wrongly claimed deduction U/s 11 of the Act as there was no registration U/s 12AA of the Act. Therefore, he prayed to allow the appeal. 5. At the outset, the ld DR has vehemently supported the order of the ld CIT(A). 6. We have heard the rival contentions of both the parties and perused the material available on the record. It is undisputed fact that the assessee is a charitable institution covered U/s 10(23C)(iiiab) as we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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