TMI Blog2018 (5) TMI 1770X X X X Extracts X X X X X X X X Extracts X X X X ..... be said that the said educational institution exists solely for (the purpose of) education. The same also contravenes the third proviso to section 10(23C)(vi). As perused the balance-sheets as at 31. 3. 2015 to 31. 03. 2017 to find no such diversion. The same being in the nature of a continuing condition could be stipulated by the competent authority while granting the approval. Subject to this, we find no valid reason not to grant approval to the assessee trust qua the Sutlej Public Senior Secondary School at Village Hawas, District Ludhiana. We, vacating the findings by the CIT(E), direct the grant of approval under section 10(23C)(vi) to the assessee trust qua SPSSS, an educational institution existing solely for the purposes of educ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l, presently up to Class XII (PB pg. 78), has been, subject to the conditions specified by it, vide its letter dated 03. 05. 2015, and the further conditions as may be intimated from time to time, granted provisional affiliation up to 31. 03. 2020 by the Central Board of Secondary Education, Delhi (CBSE) (PB pgs. 76-77. ) There is nothing on record to suggest the withdrawal of the said affiliation, nor, again, of it being regularized. Prior to its application under section 10(23C)(vi), made on 23. 09. 2016, the appellant-trust had been availing exemption u/s. 10(23C)(iiiad) in respect of the income of the said school. 3. A perusal of the impugned order reveals that the following reasons prevailed with the competent authority in rejectin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rused the material on record. 4.1 Section 10(23C)(vi) reads as under: Incomes not included in total income . 10 . In computing the total income of a previous year of any person, any income falling within any of the following clauses shall not be included- (23C) any income received by any person on behalf of- ( vi) any university or other educational institution existing solely for educational purposes and not for purposes of profit, other than those mentioned in sub-clause (iiiab) or sub-clause (iiiad) and which may be approved by the prescribed authority; or The provision is followed by several provisos , (below sec. 10(23C)(via)) which, inter alia, provide for the various monitoring conditions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wer to such a situation would normally depend on the factual implication of such an arrangement, the same should generally not be a ground for denying exemption, i. e. , unless the nature of the activities of the trust/institution get changed or modified or no longer remain as existing solely for the purposes of education and not for the purposes of profit. No such finding, the assessee s counsel, Sh. Goyal, would argue, stands issued by the ld. CIT(E), so that his inference that the said restrictive clauses in the trust deed impinge adversely on the condition of not for profit is not valid. 4.3 We shall examine each of the two objections raised per the impugned order, i. e. , in light of the requirement of law, coupled with the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llabi, the course curriculum, including facilities, viz. for sports, science labs, music, etc. to be provided to its students. It, as it appears, under its guidelines (or the Right to Education Act), is extending concession in fee to the economically backward students, etc. (PB pg. 34). How could, then, one may ask, it be said or regarded as not existing solely for education? Why, the motto of the trust itself so suggests (cl. 2 of the trust deed). 4.5 The next objection is qua the condition of not for the purposes of profit . We, again, find no correspondence between the restrictive clauses of the deed, confining the management of the trust/school effectively to the members of the settler or his immediate family, including their des ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... survives is that the funds (or income) of the educational institution are (or, is) not to be utilized by the assessee-trust, owning and managing it, for any other (non-educational) object/purpose, which, as aforenoted, there are several (also refer para 2 of the impugned order/cl. 3 of the trust deed). That is as where the funds of an educational institution are used by the person in receipt thereof for any other purpose, even if charitable, it cannot be said that the said educational institution exists solely for (the purpose of) education. The same also contravenes the third proviso to section 10(23C)(vi). We have perused the balance-sheets as at 31. 3. 2015 to 31. 03. 2017 (at PB pages 21 33), to find no such diversion. The same bein ..... X X X X Extracts X X X X X X X X Extracts X X X X
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