TMI Blog1995 (12) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... ess. It was, however, later revised and a fresh return signed by the "Delegate and Chairman of the Finance Committee of the Oxford University Press" was filed. In the past, at the assessee's own request, it had been assessed to income-tax in respect of its income in the status of a company as per the notification issued by the Central Board of Revenue. However, in the course of the hearing for assessment before the Income-tax Officer, for the above assessment year the authorised representative of the assessee-press claimed that the press was a branch of the Oxford University and hence its income would be exempt from income-tax by virtue of section 10(22) of the Act. The Income-tax Officer rejected the above contention. While doing so, the Income-tax Officer took note of the fact that the assessee was being assessed to income-tax under the Income-tax Act right from the assessment year 1952-53 as a company. He also noted the submission made on behalf of the assessee, the Oxford University Press, that it was a branch of the Oxford University, London, constituted under a charter of the British Government and that there was a stipulation in its constitution that the earnings from its ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be regarded as a University. In this connection, the Tribunal referred to the provisions of section 10(22) of the Act and observed that the exemption granted thereunder in respect of the income of a University or other educational institution was subject only to the condition that such University or educational institution existed solely for educational purposes and not for purposes of profit. The Tribunal observed that the above two conditions were fulfilled in the case of the assessee-press be cause it was a part of the Oxford University which existed solely for the purpose of education and not for purposes of profits. According to the Tribunal, the fact that the assessee was printing and publishing books in India and/or making considerable money as profit by selling books, was not relevant for the purpose of deciding the claim of the assessee for exemption under section 10(22) of the Act. The Tribunal also turned down the submission of the Revenue that the University referred to in section 10(22) of the Act must be an Indian University on the ground that section 10(22) did not contain any such restriction. In view of its above opinion, the Tribunal held that the assessee, Oxfo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ur, learned counsel for the assessee, submits that the fact that the assessee, "Oxford University Press", is a part of the Oxford University cannot be disputed by the Revenue in this reference at this stage in view of the categorical finding of the Tribunal to that effect. Mr. Dastur further submits that section 10(22) does not envisage the existence of a University or an educational institution in India. According to him, even if a University or an educational institution exists outside India, any income of such University or educational institution from any source in India will be exempt under section 10(22) of the Act. The source of income, according to learned counsel for the assessee, is immaterial for deciding the claim for exemption under section 10(22) of the Act. What is material, according to him, is the description of the assessee. Counsel submits that once the assessee falls within the description of a person specified in section 10(22) of the Act, all income derived by it from any source or any activity would be exempt from tax. Reliance is placed in support of this submission on the decisions of the Andhra Pradesh High Court in Rangaraya Medical College (Governing Bod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ution exists solely for educational purposes and not for purposes of profit. It is clear from the above provision that for exemption under this provision, it is not necessary that the assessee itself should be a University or an educational institution. The character of the assessee is not material. He may be "any person" including a person engaged in business or profession. Even then, he would be entitled to exemption under section 10(22) of the Act in respect of any income falling within clause (22) of section 10 of the Act. In other words, what is exempt is "the income of a University or an educational institution existing solely for educational purposes and not for the purpose of profit". It is not necessary for the purpose of section 10(22) that the University or educational institution itself is an assessee. Nor that such University or educational institution be established or constituted in India. What is necessary for availing of the benefit of exemption under section 10(22) of the Act is that the income is the income of University or an, educational institution "existing solely for educational purposes and not for purposes of profit". The expression " existing solely for e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Oxford University which does not exist at all in India--not to speak of solely for educational purposes. If the Oxford University had existed in India solely for educational purposes, the position would have been different and it might have been possible for it at least to contend that the income of the assessee-press is ancillary to its activities as a University and hence it should be regarded as the income of the Oxford University. But when the Oxford University itself does not exist in India, the income of the press in India cannot be held to be the income of a University for the purposes of section 10(22) of the Act merely because the press is held to be a part of the University. We have also taken note of the fact that the assessee in the instant case had given an undertaking before the Income-tax Officer that 60 per cent. of its income would be applied for educational purposes in India and the balance only will be remitted to the United Kingdom. Such undertaking, in our view, does not in any way advance the case of the assessee for exemption under section 10(22) of the Act. On the other hand, in our opinion, it clearly goes to show that even the assessee-press does n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... character outside India or it being a part of a University existing outside India, in our view, is not relevant for deciding whether its income would be exempt under section 10(22) of the Act. We are supported in our above conclusion by the decision of the Gujarat High Court in CIT v. Sorabji Nusserwanji Parekh [1993] 201 ITR 939. In the above case, dealing with the claim of the assessee for exemption under section 10(22) of the Act, it was observed (page 950) : "....in order to earn total exemption under section 10(22) of the Act, an assessee should be an educational institution or an establishment which primarily engages itself in educational activities. Though the words 'educational activities' are words of very wide amplitude, we would like to add that the element of imparting education to students or the element of normal schooling where there are teachers and taught must be present so as to fall within the sweep of section 10(22) of the Act. We would, at the same time, like to add that such an institution may, incidentally, take other activities for the benefit of students or in furtherance of their education. It may invest its funds in any manner it likes or it may prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ist in India solely for educational purposes and if it so exists, then and then only its income would be exempt under section 10(22) of the Act. If it does not exist as a University or an educational institution solely for such purposes and does not carry on the primary activities of a University or educational institution, but merely runs the business of press in India for printing and publishing books and selling and supplying the same as well as books published by other publishers for the purpose of profit, it cannot be held to be a "University" within the meaning of section 10(22) of the Act merely by reason of the fact that it is run by a University existing outside India for educational purposes or that it is a part of such University. Moreover, as indicated earlier, the assessee in this case is the Oxford University Press which claims itself to be a part of the Oxford University and claims exemption of its income as income of a University. If the case of the assessee is that in the true sense of the term it is a part and parcel of the Oxford University and has no independent existence of its own, and all its income is the income of the said University, the "assessee" for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ional purposes and not for profit." Obviously, the ratio of this decision would not be applicable to the facts of the present case. In Rangaraya Medical College (Governing Body of) v. ITO [1979] 117 ITR 284 (AP), the controversy was whether the assessee-society was a medical college entitled to exemption from income-tax under section 10(22) of the Act. Considering the facts and circumstances of the case, the court came to the conclusion that the assessee-society, whose sole object was managing and maintaining the medical institution, was an educational institution without any profit motive or personal profit for the purposes of section 10(22) of the Act. The ratio of the above decision cannot be applied to the present case where the object of the assessee-press was not to manage or maintain the Oxford University or any other educational institution. Equally inapplicable is the ratio of the decision of the Kerala High Court in CIT v. Sree Narayana Chandrika Trust [1995] 212 ITR 456. In that case, the controversy was whether the assessee-trust, whose sole object was the establishment and running, etc., of hospitals, was entitled to exemption under section 10(22A) of the Act. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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