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TMI Blog2018 (9) TMI 1400X X X X Extracts X X X X X X X X Extracts X X X X ..... 21/Chd/2016) of Commissioner of Income Tax (Exemptions), Chandigarh [hereinafter referred to as 'CIT(E)']. 2. Since certain common issues have been raised in both the appeals, hence these were heard together and are being disposed of by this common order. ITA No. 462/Chd/2017 is taken as lead case for narration of facts. ITA No. 462/Chd/2017 3. Though the assessee in this appeal has taken as many as 14 grounds of appeal, however, the effective issue raised in this appeal is against the denial of exemption to the assessee claimed u/s 10(23C)(iiiab) of the Income-tax Act, 1961 (in short 'the Act'). 4. The brief facts of the case are that assessee is a Society registered with Registrar of Societies, Chandigarh and the main object ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal before CIT(A). However, the Ld. CIT(A) confirmed the findings of the Assessing officer on the above issue. He further held that to claim exemption u/s 10(23C)(iiiab) of the Act, one of the requirement was that institution must be wholly or substantially financed by the Government. He further observed that even the assessee institution was not substantially financed by the Government which means that the grant received from the Government should be more than of 50% of the total receipts during the relevant year. However, in the case of the assessee, it was below 50%. He, therefore, held that assessee even otherwise did not satisfy the condition that it was substantially financed by the Government during the year. The Ld. CIT(A) theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ducational institute and the hotel. The Ld. counsel, therefore, submitted that assessee should be allowed exemption u/s 10(23C)(iiiab) of the Act in respect of the educational institution. 7. The Ld. DR, on the other hand, has submitted that since the assessee is also involved in a business activity of running a hotel, hence, the activities of the assessee cannot be said to be solely for educational purposes and not for profit and, therefore, the deduction has rightly been denied to the assessee by the lower authorities. 8. We have considered the rival contentions and have gone through the record. The Ld. counsel has relied upon the voluminous record to submit that the activity of the assessee in respect of the running of educational inst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isting solely for educational purposes and not for the purpose of profit which is wholly or substantially financed by the Government; meaning thereby that part of the income of a person which is received on behalf of any institute falling under the provisions of section 10(23C)(iiiab) of the Act will be exempt, it does not mean that entire income of the 'Person' should be from the institute solely existing for educational purposes and not for profit and substantially financed by the Government or that the 'person' is barred from entering into any business activity. Hence, in our view, as per the provisions of section 10(23C)(iiiab) of the Act, that part of the income of the person will be exempt which is received from an institution solely ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... afresh in the light of the observations made above and in accordance with law. This appeal of the assessee is accordingly treated as allowed for statistical purposes. ITA No. 1021/Chd/2016 10. This appeal is preferred by the assessee against the denial of registration to the assessee society u/s 12A of the Act. 11. Both the Ld. representatives of the parties have submitted that since the findings of the Ld. CIT(E)) in this case was based on the findings of the Assessing officer holding that the assessee was running a hotel business along with an educational institute and since the matter has been restored to the file of the Assessing officer, in respect of ITA No. 462/Chd/2017 (assessment year 2013-14), as observed above, the matter in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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