TMI Blog2021 (7) TMI 905X X X X Extracts X X X X X X X X Extracts X X X X ..... r the UGC Guidelines which is an ancillary activity. In the absence of any evidence to show that the hostel facilities were provided to anybody other than students and staff of the trust, the hostel facilities provided by the educational institution shall be construed to be the intrinsic part of the educational activities of the assessee and they cannot be considered different than activities of the society of education - The addition amounting made by the AO and sustained by the CIT(A) is not correct. CIT(A) and the AO failed to consider that the hostel facility is incidental to achieve the object of providing education as per object of the trust and hence comes under the charitable purpose which is exempt under Section 11 - Appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g Guest Hostels) in the Ghaziabad area and not relate to the hostel facilities provided to its students by the colleges. 3. Whereas Ld. Commissioner (Appeal) erred in law as also in facts and circumstances of the case to confirm the addition of ₹ 3,92,25,432/- made by the AO to unjustifiably and arbitrarily invoke provisions of section 11(4A) of the I.T. Act, 1961 in the case of the assessee 3. The assessee Society is duly registered under Society Registration Act, 1860. The Society has been granted registration u/s 12AA of the Income Tax Act, 1961 vide order dated 15/6/1995. The Society has also been granted exemption u/s 80G of the Act vide order dated 18/6/2010 for the period from 1/4/2010. The Society is running various ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lus in consolidation of the Institute, receipts and expenditure, hostel activity maintain by an Educational Institute under statutory requirement is an integral activity. As per list of University Grant Commission (UGC) it has more than 600 Universities and out of those Universities, we are enclosing here with. Details of Hostel facilities enumerated by each U. P University on their web sites which clearly indicates that Hostel activity is not a incidental or ancillary activity or business activity but an integral activity required to required to regularize the functionality of Educational Institute. Therefore, it was because of the aforesaid guidelines, the assessee society was obliged to maintain hostel and assessee has fulfilled the requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tivity whereas the assessee is also running hostels for the students as per the UGC Guidelines which is an ancillary activity. In case of Krishna Charitable Society vs. Addl. CIT in ITA No. 4639/Del/2015 for AY 2011-12 dated 15.09.2017, the Tribunal held as under: 11. We have carefully considered the rival contentions and perused the orders of the lower authorities and other judicial pronouncement placed before us. In the grounds no. 1 - 3 assessee is contesting that addition made by the Ld. AO treating hostel places provided to college student as business of the society and text the alleged surplus of ₹ 98,87,873/- as business income of the assessee. It was not the case of the revenue that assessee has rented out these hostels t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Institute nor could the running of the hostel be treated as the principal activity of the Institute. The Institute could not be held to be doing business. Further means being supplied in a hostel to the scholars, visitors, guest faculty etc. cannot be eligible to sales tax where main activity is academics as held in scholars home Senior Secondary School 42 VST 530. Further, the reliance placed by the lower authorities on the decision of the Hon ble Madras High Court in case of DCIT vs. Wellington Charitable Trust is also misplaced because in that case, the only activity of that particular trust was renting out of the property and not education. We are also not averse to considering the latest legal developments too where in the recent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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