TMI Blog2017 (7) TMI 1129X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee were clearly the application of its income in nature which had been spent to achieve the objects of the assessee. The assessee had been granted approval under section 10(23C)(iv) of the Act and thus, there was no question of disallowing of any amount of this nature. As decided in the case of [Commissioner of Income-tax Versus Red Rose School 2007 (2) TMI 575 - ALLAHABAD HIGH COURT ] CIT has to satisfy himself about the genuineness of the activities of the trust or institution and also about the objects of the trust or the institution - on being satisfied he will either grant the certificate or would reject - thus Revenue has not been able to point out any error in the order passed by the Tribunal so no substantial question of law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenditure even when the exemption under section 10(23C)(iv) was denied by the Assessing Officer ? 2. A few facts necessary for adjudication of the controversy involved as narrated in the appeal may be noticed. The assessee-respondent filed return of income claiming exemption under section 10(23C)(iv) of the Act. The Assessing Officer (AO) framed assessment by denying the exemption under section 10(23C)(iv) of the Act as it was not approved by the prescribed authority. Credit for capital expenditure which was allowable to an exempted entity was also denied. The Assessing Officer made the additions of excess of income over expenditure of ₹ 15,15,89,376 apart from additions of capital expenditure of ₹ 1,52,03,549 (annexure A-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellant- Revenue. 4. Admittedly, the assessee filed return of income declaring nil income. During the year under consideration, the assessee was having income of ₹ 15,15,89,376, but after claiming exemption under section 10(23C)(iv) of the Act, the assessee showed nil income in the return of income. The Commissioner of Income-tax (Appeals) noticed that the Commissioner of Income-tax (Exemptions) vide order dated March 1, 2016 had granted exemption under section 10(23C)(iv) of the Act to the assessee with effect, from the assessment years 2006-07 to 2011-12. It was further observed that after considering the explanation of the assessee in the light of the Circular No. 7 of 2010, once the approval had been granted under section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esent case, capital expenditure had not been charged to profit and loss account. The third proviso to section 10(23C) of the Act provides for . . . applies its income or accumulates it for application, wholly or exclusively to the objects for which it is established . . . . Thus, the amount was spent by the assessee towards the object. It was further recorded by the Tribunal, after examining the matter that the amounts spent by the assessee were clearly the application of its income in nature which had been spent to achieve the objects of the assessee. The assessee had been granted approval under section 10(23C)(iv) of the Act and thus, there was no question of disallowing of any amount of this nature. 6. Adverting to the judgment relie ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
