ITO, CHENNAI V. Alliance Francaise of Madras, CHENNAI

ITA 1238/CHNY/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 4073 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-07-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 05-07-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 05-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R RAJESWARI
• Assessee Lawyers: S SRIDHAR
• Keywords: Capital asset

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: CHENNAI , ! . , ' BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER , AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NOS.1237, 1238 & 1239/MDS/2016 /ASSESSMENT YEARS: 2010-11, 2011-12 & 2012-13 THE INCOME TAX OFFICER (EXEMPTIONS), WARD-1, AAYAKAR BHAVAN, ANNEXE BUILDING, III FLOOR, 121, M.G.ROAD, NUNGAMBAKKAM, CHENNAI-600 034. VS. M/S.ALLIANCE FRANCAISE OF MADRAS, NO.24 (OLD NO.40) COLLEGE ROAD, CHENNAI-600 006. [PAN: AABTA 2098 R ] ( & /APPELLANT) ( '( & /RESPONDENT) & ) / APPELLANT BY : SMT.R.RAJESWARI, JCIT '(& ) /RESPONDENT BY : SHRI S.SRIDHAR, ADV. ) /DATE OF HEARING : 10.07.2017 ) /DATE OF PRONOUNCEMENT : 10.07.2017 / O R D E R PER GEORGE MATHAN , JUDICIAL MEMBER : THESE ARE THREE APPEALS FILED BY THE REVENUE AGAIN ST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-17, CHENNAI, I N ITA NO.159/13-14 78/14-15 & 23/15-16 DATED 23.02.2016 FOR THE AYS 20 10-11, 2011-12 & 2012-13 . ITA NOS.1237 TO 1239/MDS/2016 :- 2 -: 2. SMT.R.RAJESWARI, JCIT, REPRESENTED ON BEHALF OF THE APPELLANT AND SHRI S.SRIDHAR, ADV., REPRESENTED ON BEHALF OF THE RESPONDENT. 3. AS THE ISSUES IN THE REVENUE APPEALS ARE IDENTIC AL, ALL THE THREE APPEALS ARE DISPOSED BY A COMMON ORDER. IT WAS SUBMITTED BY THE LD.DR THAT THE ASSESSEE IS REGISTERED U/S.12AA OF THE ACT. IN THE COURSE OF THE ASSESSME NT, IT WAS NOTICED THAT THE ASSESSEE WAS HAVING INCOME IN THE FORM OF MEMBE RSHIP FEE FROM THE STUDENTS, INCOME FROM SALE OF TEXT BOOKS & CASSETTE S, INCOME FROM TRANSLATION CHARGES AND CORPORATE TEACHING COURSES. IT WAS A SUBMISSION THAT THE SAID TRANSACTIONS WERE IN THE NATURE OF CO MMERCIAL BUSINESS OF RUNNING COACHING INSTITUTE AND WAS CONSEQUENTLY NOT ELIGIBLE FOR EXEMPTION U/S.11 OF THE ACT. IT WAS A SUBMISSION THAT THE PR INCIPAL AND PRIMARY ACTIVITY OF THE ASSESSEE WAS CLAIMED TO BE THE DIFF USION OF USEFUL KNOWLEDGE REGARDING FRENCH. IT WAS A SUBMISSION TH AT THE ASSESSEE RUNNING THE COACHING CLASSES IN FRENCH AND COLLECTI NG TUITION FEE AND ALSO INCOME FROM SALE OF TEXT BOOKS, TRANSLATION CHARGES AND MEMBERSHIP FEES WAS NOT ENTITLED TO THE BENEFIT OF THE EXEMPTION U/ S.11 OF THE ACT. IT WAS A SUBMISSION THAT LD.CIT(A) HAD ALLOWED THE CLAIM O F THE ASSESSEE. IT WAS THE SUBMISSION THAT THE ORDER OF THE LD.CIT(A) WAS LIABLE TO BE REVERSED. ITA NOS.1237 TO 1239/MDS/2016 :- 3 -: 4. IN REPLY, THE LD.AR VEHEMENTLY SUPPORTED THE ORD ER OF THE LD.CIT(A). IT WAS A SUBMISSION THAT BENEFIT OF REGI STRATION U/S.12A HAD NOT BEEN DISTURBED AND THERE WAS NO DENIAL OF EXEMPTION U/S.11 FOR ANY OF THE EARLIER YEARS IN RESPECT OF THE SAID INCOMES. HE D REW OUR ATTENTION TO PAGE NOS.5 & 6 OF THE ORDER OF LD.CIT(A). IT WAS A SUBMISSION THAT THE ORDER OF THE LD.CIT(A) MAY BE SUSTAINED. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PERU SAL OF THE ORDER OF LD.CIT(A) CLEARLY SHOWS THAT THE LD.CIT(A) HAS TAKE N INTO CONSIDERATION THE FACT THAT THE ASSESSEES SOCIETY IS CONDUCTING CLASSES AND EXAMINATION FOR THE STUDENTS LEADING TO OBTAIN DEGREES OR DIPLO MAS PRESCRIBED BY THE EDUCATION MINISTRY OF FRANCE. THE COURSE CONTENTS AND THE SYLLABUS AND THE CURRICULUM HAVE ALL BEEN PRESCRIBED BY THE FREN CH EDUCATION MINISTRY. IT HAS ALSO NOTICED THAT THE LD.CIT(A) HAS VERIFIED AND HAS COME TO THE CONCLUSION THAT THE FEES CHARGED IS NOT ON COMMERCI AL TERMS AND WAS ONLY TO RECOUP THE EXPENDITURE INCURRED ON STAFF SALARIE S, ADMINISTRATIVE EXPENSES, UPKEEP AND MAINTENANCE OF INFRASTRUCTURE, AND PURCHASES OF CAPITAL ASSETS TO EXPAND ITS ACTIVITIES. IT HAS AL SO NOTICED THAT THE LD.CIT(A) HAS GIVEN A CATEGORICAL FINDING THAT THE SURPLUS ARISING ON ACCOUNT OF THE ACTIVITIES OF THE ASSESSEE IS PLOUGH ED BACK INTO THE SOCIETY FOR MAINTAINING AND EXPANDING ITS INFRASTRUCTURE AN D NO PART OF SUCH SURPLUS IS DISTRIBUTED TO THE MEMBERS OR GIVEN TO T HE GOVERNING BODY OF THE MEMBERS AS REMUNERATION. THE REVENUE HAS NOT B EEN ABLE TO DISLODGE ANY OF THESE FINDINGS AS ARRIVED AT BY LD. CIT(A). THIS BEING SO, ITA NOS.1237 TO 1239/MDS/2016 :- 4 -: WE ARE OF THE VIEW THAT THE FINDINGS OF THE LD.CIT( A) ON THESE ISSUES ARE ON A RIGHT FOOTING AND DOES NOT CALL FOR ANY INTERF ERENCE. 6. IN THE RESULT, THE APPEALS FILED BY THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON JULY 10, 201 7, AT CHENNAI. SD/- SD/- ( . ) ( A. MOHAN ALANKAMONY ) ! /ACCOUNTANT MEMBER ( ) (GEORGE MATHAN) ! /JUDICIAL MEMBER /CHENNAI, 1 /DATED: JULY 10, 2017. TLN ) '23 43 /COPY TO: 1. & /APPELLANT 4. 5 /CIT 2. '(& /RESPONDENT 5. 3 ' /DR 3. 5 ( ) /CIT(A) 6. /GF