ADIT(Exemption)-III, Hyderabad V. Loyala Academy Society, Hyderabad

ITA 1892/HYD/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61920 (ITAT-HYDERABAD)
• Duration Of Justice: 7 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-06-2012
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 08-11-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Section: 12A; 2; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI D.KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO.1892/HYD/2011 : ASSESSMENT YEAR 2008- 09 ASSTT . DIRECTOR OF INCOME - TAX(EXEMPTION) II, HYDERABAD V/S M/.S. LOYOLA ACADEMY SOCIETY, HYDERABAD ( PAN - AAATL 1740 Q ) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI V.SRINIVAS RESPODNENT BY : NONE DATE OF HEARING 11.6.2012 DATE OF PRONOUNCEMENT 15.6.2012 O R D E R PER D.KARUNAKARA RAO, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAI NST THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS)-IV, HYDE RABAD DATED 30.8.2011 FOR THE ASSESSMENT YEAR 2008-09. 2. EFFECTIVE GROUNDS OF THE REVENUE IN THIS APPEAL READ AS FOLLOWS- 1. THE ORDER OF THE LD. CIT(A) IS ERRONEOUS BOTH O N FACTS AND IN LAW. 2. THE LD. CIT(APPEALS) ERRED TO HOLD THAT THE ASS ESSEE IS ELIGIBLE FOR CLAIM UNDER SECTION 11 IN ABSENCE OF A PPROVAL UNDER SUB-CLAUSE (VI) TO THE SECTION 10(23C). 3. THE LD. CIT(APPEALS) FAILED TO SEE THAT APPROVAL SUB-CLAUSE (VI) TO THE SECTION 10(23C) IS DISTINCT FROM REGIST RATION U/S. 12A OF THE ACT. 4. THE LD. CIT(A) FAILED TO SEE THAT SUB-CLAUSE (VI ) TO THE SECTION 10(23C) AS INSERTED BY THE FINANCE ACT, 199 8 W.E.F. 01.04.1999 STATES THAT THE UNIVERSITY OR OTHER EDUC ATIONAL INSTITUTION EXISTING SOLELY FOR EDUCATIONAL PURPOSE MAY BE APPROVED BY THE PRESCRIBED AUTHORITY. THE ISSUE IS EXPLICITLY DEALT WITH BY THE ACT ITSELF AND THE INTENTION OF T HE LEGISLATURE IS QUITE CLEAR FROM IT. ITA NO.1892/HYD/2011 LOYALA ACADEMY SOCIETY, SECUNDERABAD. 2 5. THE LD. CIT(APPEALS) FAILED TO APPRECIATE THAT THE DECISION OF THE APEX COURT IN THE CASE OF CIT V/S. BAR COUNC IL OF MAHARASHTRA WAS M ADE IN THE YEAR 1981 PRIOR TO INTRODUCTION OF THE SUB-CLAUSE (VI) TO THE SECTION 10(23C) [INSERTED BY THE FINANCE ACT, 1998 W.E.F. 01.04.199 9] 6. THE LD. CIT(APPEALS) FAILED TO SEE THAT IN THE C ITED CASE OF AMERICAN HOTEL AND LODGING ASSN./EDUCATIONAL INSTIT UTE VS. CBDT (2008) (170 TAXMAN 306)(SC), THE HONBLE SUPRE ME COURT SET ASIDE THE ORDER OF THE CBDT DECLINING APP ROVAL UNDER SECTION 10(23C) (VI) AND RESTORED THE APPLICA TION OF THE ASSESSEE FOR FRESH DISPOSAL AND DID NOT DISPENS E WITH THE REQUIREMENT OF APPROVAL UNDER SECTION 10(23C)(V I). IN THE CONTRARY, THE DECISION OF THE APEX COURT STREN GTHENED THE VIEW THAT THE APPROVAL UNDER SECTION 10(23C)(VI ), BY THE PRESCRIBED AUTHORITY, IS A PREREQUISITE FOR ENJOYIN G EXEMPTION BY ANY UNIVERSITY OR OTHER EDUCATIONAL INSTITUTION. 3. DESPITE NOTICE, NONE APPEARED ON BEHALF OF THE ASSESSEE- RESPONDENT. THERE IS NOT EVEN A PETITION FOR ADJOU RNMENT RECEIVED ROM THE ASSESSEE. IN THE CIRCUMSTANCES, WE HEARD THE L EARNED DEPARTMENTAL REPRESENTATIVE AND PROCEED TO DISPOSE OFF THIS APPE AL EX-PARTE QUA THE ASSESSEE- ON THE BASIS OF MATERIAL AVAILABLE ON REC ORD. 4. WE HEARD THE LEARNED DEPARTMENTAL REPRESENTATI VE AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THE ISSUE RAISED IN THE ABOVE GROUNDS OF APPEAL BY THE REVENUE IS IDENTICAL TO THE ONES ALREADY ADJUDICATED BY THIS TRIBUNAL IN SIMILAR MATTERS, AS IN THE CASE OF ADIT V/S. LINCOLNS EDUCATION SOCIETY, HYDERABAD, WHEREIN THE TRIBUNAL VIDE ORDER DATED 8 TH JULY, 2011 IN ITA NO.4/HYD/2011 FOR THE ASSESSMENT YEAR 2007-08, HAS HELD VIDE PARA 5 THEREOF AS FOLLOWS- 5. WE HOWEVER, FIND THAT THE HYDERABAD BENCH OF T HE TRIBUNAL IN DIRECTOR OF INCOME-TAX(EXEMPTION) V/S. VASAVI ACADE MY OF EDUCATION IN ITA NO.1449/HYD/2008, VIDE ORDER DATED 4.2.2010, HAS HELD THAT AN EDUCATIONAL INSTITUTION IS ENTITLED FO R EXEMPTION UNDER S.10(23C) OR UNDER S.11, IF NO DONATION WAS COLLECT ED FROM THE STUDENTS. WE BEING IN AGREEMENT WITH THE ORDER OF T HE COORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF VASAVI ACADEMY OF EDUCATION(SUPRA), DIRECT THE ASSESSING OFFICER TO V ERIFY THE ASPECT OF DONATION, CAPITATION FEE ETC. IF ANY COLLECTED BY T HE ASSESSEE, AND FURTHER DIRECT THAT IF IT IS FOUND THAT BESIDES FUL FILLING OTHER ITA NO.1892/HYD/2011 LOYALA ACADEMY SOCIETY, SECUNDERABAD. 3 PREREQUISITES FOR EXEMPTION UNDER S.11, THE ASSESSE E HAS NOT CHARGED ANY MONEY BY WHATEVER NAME IT IS CALLED, I. E. DONATION, BUILDING FUND, AUDITORIUM FEE ETC, OVER AND ABOVE T HE PRESCRIBED FEE FOR THE ADMISSION OF STUDENTS, THE ASSESSEE WOULD B E ENTITLED FOR EXEMPTION UNDER S.11, EVEN THOUGH THE NOTIFICATION UNDER S.10(23C)(VI) OF THE ACT HAVE NOT BEEN RECEIVED BY IT. WE DIRECT ACCORDINGLY. CONSISTENT WITH THE VIEW TAKEN BY THE COORDINATE BE NCHES OF THE TRIBUNAL IN SIMILAR MATTERS, WE SET ASIDE THE IMPUGNED ORDER OF THE CIT(A) AND RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFF ICER WITH A DIRECTION TO VERIFY THE ASPECT OF DONATION, CAPITATION FEE ETC. IF ANY COLLECTED BY THE ASSESSEE, AND FURTHER DIRECT THAT IF IT IS FOUND TH AT BESIDES FULFILLING OTHER PREREQUISITES FOR EXEMPTION UNDER S.11, THE ASSESSE E HAS NOT CHARGED ANY MONEY BY WHATEVER NAME IT IS CALLED, I.E. DONAT ION, BUILDING FUND, AUDITORIUM FEE ETC, OVER AND ABOVE THE PRESCRIBED F EE FOR THE ADMISSION OF STUDENTS, THE ASSESSEE WOULD BE ENTITLED FOR EXE MPTION UNDER S.11, EVEN THOUGH THE NOTIFICATION UNDER S.10(23C)(VI) OF THE ACT HAVE NOT BEEN RECEIVED BY IT. WE DIRECT ACCORDINGLY. 5. IN THE RESULT, REVENUES APPEAL IS PARTLY ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 15.6.2012 SD/- SD/- (SAKTIJIT DEY) (D.KARUNAKARA RAO) JUDICIAL MEMBER. ACCOUNTANT MEMBER. DT/- 15 JUNE, 2012 COPY FORWARDED TO: 1. 2. 3 M/.S. LOYOLA ACADEMY SOCIETY, ALWAL, SECUNDERABAD. ASSTT. DIRECTOR OF INCOME-TAX(EXEMPTION) II, HYDERA BAD COMMISSIONER OF INCOME - TAX(APPEALS) I V HYDERABAD 4. COMMISSIONER OF INCOME - TAX III , HYDERABAD 5. DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD B.V.S.