M/s. Bhartiya Gram Sewa Niketan Udyog Mandal, New Delhi V. CCIT, Dehradun

ITA 3708/DEL/2015

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3881 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 15-05-2017
• Assessment Year: 2013-2014
• Appeal Filed On: 08-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJA RAM SAH
• Assessee Lawyers: ASHWANI TANEJA; SHANTANU JAIN ADVS
• Keywords: Principle of natural justice; Opportunity of cross examination; Capital expenditure
• Section: 11

Judgement Text

1 ITA NO. 3708/DEL/2015 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: C NEW DELHI BEFORE SHRI G. D. AGRAWAL, PRESIDENT AND MS SUCHITRA KAMBLE, JUDICIAL MEMBER I.T.A .NO. 3708/DEL/2015 (A.Y 2013-14) BHARTIYA GRAM SEWA NIKETAN UDYOG MANDAL C/O. M/S. RRA TAX INDIA, D-28, SOUTH EXTENSION, PART-1 NEW DELHI AABAB4919P (APPELLANT) VS CCIT DEHRADUN (RESPONDENT) APPELLANT BY SH. ASHWANI TANEJA & SH. SHANTANU JAIN, ADVS. RESPONDENT BY SH. RAJA RAM SAH, CIT DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 5/9/2014 PASSED BY CCIT-DEHRADUN FOR ASSESSMENT YEAR 2013-14 . 2. THE GROUNDS OF APPEAL ARE AS UNDER:- 1. THAT HAVING REGARD TO THE FACTS AND CIRCUMS TANCES OF THE CASE, LD. CCIT HAS ERRED IN LAW AND ON FACTS IN CANCELLING TH E APPROVAL U/S 10(23C)(VI) BY MAKING FOLLOWING OBSERVATIONS:- (A) THAT THERE IS NO ELEMENT OF CHARITY AND THE ACTIVIT IES ARE PURELY COMMERCIAL DATE OF HEARING 07.12.2017 DATE OF PRONOUNCEMENT .01.2018 2 ITA NO. 3708/DEL/2015 IN CHARACTER. (B) THAT THE MAIN AIM OF THE ASSESSEE SEEMS TO BE TO EA RN HUGE SURPLUS EVERY YEAR AND INVEST IT IN THE FORM OF ADDITION TO SCHOO L BUILDING AND OTHER INFRASTRUCTURE. 2. THAT IN ANY CASE AND IN ANY VIEW OF THE MATTER , ACTION OF LD. CCIT IN CANCELING THE APPROVAL UNDER SECTION 10(23C)(VI) IS BAD IN LAW AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE AND IS CONTRARY TO THE PRINCIPLES OF NATURAL JUSTICE AS THE IMPUGNED ORDER HAS BEEN PASSED WITHO UT GRANTING ADEQUATE OPPORTUNITY OF HEARING, BY RECORDING INCORRECT FACT S AND FINDINGS AND WITHOUT PROVIDING THE OPPORTUNITY OF CROSS EXAMINATION AND THE APPELLANT OUGHT TO HAVE BEEN GRANTED BENEFIT OF APPROVAL UNDER THE LAW . 3. THAT THE APPELLANT CRAVES THE LEAVE TO ADD, MO DIFY, AMEND OR DELETE ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING AND ALL THE ABOVE GROUNDS ARE WITHOUT PREJUDICE TO EACH OTHER. 3. THE ASSESSEE APPLIED FOR GRANT OF APPROVAL U/S 1 0(23C)(VI) OF THE INCOME TAX ACT, 1961 BY FILING APPLICATION IN FORM NO. 56D ON 30.09.2013. THE ASSESSEE IS REGISTERED UNDER THE SOCIETY REGISTRATI ON ACT, 1860, AND RUNS A COLLEGE IN THE NAME OF COLLAGE OF ADVANCED TECHNOLO GY AT PUHANA, ROORKEE. THE COLLEGE OFFERS DIPLOMA COURSES IN POLYTECHNIC A ND ENGINEERING WHICH ARE APPROVED BY AICTE. THE CHIEF COMMISSIONER OBSERVED THAT THE ASSESSEES OBJECTS INCLUDE MANY OTHER ACTIVITIES APART FROM ED UCATION. AS SUCH, THE CHIEF COMMISSIONER HELD THAT THE ASSESSEE CANNOT BE CONSI DERED TO BE EXISTING SOLELY FOR EDUCATIONAL PURPOSES AND WHICH IS AGAINST THE S OUL OF SEC. 10(23C)(VI) OF THE ACT SINCE THE BASIC REQUIREMENT OF THE SECTION IS T HAT THE EDUCATION INSTITUTION MUST EXIST SOLELY FOR THE PURPOSE OF EDUCATION AND NOT FOR THE PURPOSE OF MAKING PROFIT. THE CHIEF COMMISSIONER RELYING ON TH E JUDGMENT OF THE HONBLE UTTARAKHAND HIGH COURT IN CASE OF CIT VS. QUEENS E DUCATION SOCIETY 177 3 ITA NO. 3708/DEL/2015 TAXMANN 321, HELD THAT THOUGH THE HONBLE HIGH COUR T WAS DEALING WITH EXEMPTION U/S 10(23C)(IIIAD),WHAT IS PROPOUNDED BY THEM APPLIES EQUALLY FOR TESTING THE CLAIM OF APPROVAL U/S 10(23C)(VI) IN TH E PRESENT CASE FOR SECTION 10(23C)(VI) ALSO, THE EDUCATIONAL INSTITUTION SHOUL D NOT EXIST FOR MAKING PROFIT. THUS, THE CHIEF COMMISSIONER REJECTED THE APPLICATI ON SEEKING APPROVAL U/S 10(23C)(VI) OF THE ASSESSEE. 4. BEING AGGRIEVED BY THE SAME, THE ASSESSEE IS BEF ORE US. 5. THE LD. AR SUBMITTED THAT THE SOCIETY GOT REGIST ERED UNDER THE SOCIETY REGISTRATION ACT, 1860 ON 07.03.1987 AND APPLIED FO R APPROVAL U/S 10(23C)(VI) BY FILING AN APPLICATION AFTER COMPLETING ALL THE L EGAL FORMALITIES IN PRESCRIBED FORM NO. 56D ON 30.09.2013 IN THE OFFICE OF CCIT, D EHRADUN, WHICH WERE REJECTED VIDE ORDER DATED 05.09.2014 WITHOUT CONSID ERING THE FACTS AND CIRCUMSTANCES OF THE CASE. THE LD. AR FURTHER SUBMI TTED THAT THE MAIN OBJECTS OF THE TRUST ARE TO ENCOURAGE BACKWARD AND DISCARDE D PEOPLE TOWARDS EDUCATION AND SOCIAL DEVELOPMENT WORKS, HELPING CHI LDREN BY PROVIDING EDUCATION AND LIVELIHOOD TO THEM ETC. ALSO THE TRUS T RUNS A COLLEGE THAT HELPS IN ENHANCING THE FUTURE OF STUDENTS BY PROVIDING THE E DUCATION AND MAKING AVAILABLE THE DIPLOMA COURSES IN POLYTECHNIC AND EN GINEERING WHICH ARE DULY APPROVED BY AICTE. HENCE ALL OBJECTS ARE IN CONSIDE RATION FOR GRANTING THE APPROVAL U/S 10(23C)(VI) OF THE ACT. THE LD. AR FUR THER SUBMITTED THAT WHILE REJECTING THE EXEMPTION U/S 10(23C)(VI) AS CLAIMED BY THE ASSESSEE, THE CHIEF COMMISSIONER PLACED RELIANCE ON THE JUDGMENT OF CIT VS. QUEENS EDUCATION SOCIETY (SUPRA) WHICH IS OVERRULED BY THE HONBLE A PEX COURT IN 372 ITR 699 AND THEREFORE, THE ISSUE IS SQUARELY COVERED IN FAV OUR OF THE ASSESSEE. 6. THE LD. DR RELIED UPON THE ORDER OF THE CHIEF CO MMISSIONER BUT COULD NOT REFUTE THE JUDGMENT OF THE HONBLE APEX COURT ( SUPRA). 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED ALL T HE RECORDS PLACED BEFORE US. THE HONBLE UTTARAKHAND HIGH COURT DECISION IN CASE OF CIT VS. QUEENS 4 ITA NO. 3708/DEL/2015 EDUCATION SOCIETY WAS OVERRULED BY THE HONBLE SUPR EME COURT WHEREIN IT IS HELD THAT: 23. THE PUNJAB AND HARYANA HIGH COURT, BY THE IMPUGNED JUDGMENT DATED 29 TH JANUARY, 2010 EXPRESSED ITS DISSATISFACTION WITH T HE VIEW TAKEN BY THE UTTARAKHAND HIGH COURT IN THE CASE OF QUEENS EDUCA TIONAL SOCIETY AS FOLLOWS: 8.8 WE HAVE NOT BEEN ABLE TO PERSUADE OURSELVES TO ACCEPT THE VIEW EXPRESSED BY THE DIVISION BENCH OF THE UTTRAKHAND H IGH COURT IN THE CASE OF QUEENS EDUCATIONAL SOCIETY (SUPRA). THERE ARE VARIETY OF REASONS TO SUPPORT OUR OPINION. FIRSTLY, THE SCOPE OF THE THIRD PROVISO WAS NOT UNDER CONSIDERATION, INASMUCH AS, THE CASE BEFORE THE UTTRAKHAND HIGH COURT PERTAINED TO SECTION 10(23C)( IIIAD) OF THE ACT. THE THIRD PROVISO TO SECTION 10(23C)(VI) IS NOT APP LICABLE TO THE CASES FALLING WITHIN THE PURVIEW OF SECTION 10(23C)(IIIAD ). SECONDLY, THE JUDGMENT RENDERED BY THE UTTARKHAND HIGH COURT RUNS CONTRARY TO THE PROVISIONS OF SECTION 10(23C)(VI) OF THE ACT INCLUD ING THE PROVISOS THEREUNDER. SECTION 10(23C)(VI) OF THE ACT IS EQUIV ALENT TO THE PROVISIONS OF SECTION 10(22) EXISTING EARLIER, WHICH WERE INTR ODUCED WITH EFFECT FROM 1ST APRIL, 1999 AND IT IGNORES THE SPEECH OF T HE FINANCE MINISTER MADE BEFORE THE INTRODUCTION OF THE SAID PROVISIONS , NAMELY. SECTION 10(23C) OF THE ACT [SEE OBSERVATIONS IN AMERICAN HOTEL AND LODGING ASSOCIATION EDUCATIONAL INSTITUTE'S CASE (SUPRA)]. THIRDLY, THE UTTRAKHAND HIGH COURT HAS NOT APPRECIATED CORRECTLY THE RATIO OF THE JUDGMENT RENDERED BY HON'BLE THE SUPREME COURT IN T HE CASE OF ADITANAR EDUCATIONAL INSTITUTION (SUPRA) AND WHILE APPLYING THE SAID JUDGMENT INCLUDING THE JUDGMENT WHICH HAD BEEN REND ERED BY HON'BLE THE SUPREME COURT IN THE CASE OF CHILDREN BOOK TRUST (SUPRA), IT LOST SIGHT OF THE AMENDMENT WHICH HAD BEEN CARRIED OUT W ITH EFFECT FROM 1ST APRIL, 1999 LEADING TO THE INTRODUCTION OF THE PROV ISIONS OF SECTION 10(23C) OF THE ACT. LASTLY, THAT VIEW IS NOT CONSIS TENT WITH THE LAW LAID DOWN BY HON'BLE THE SUPREME COURT IN AMERICAN HOTEL AND LODGING ASSOCIATION EDUCATIONAL INSTITUTE (SURPA). IT THEN SUMMED UP ITS CONCLUSIONS AS FOLLOWS: 8.13 FROM THE AFORESAID DISCUSSION, THE FOLLOWING PRINCIPLES OF LAW CAN BE SUMMED UP: (1) IT IS OBLIGATORY ON THE PART OF THE CHIEF COMMISSI ONER OF INCOME TAX OR THE DIRECTOR, WHICH ARE THE PRESCRIBED AUTHORITI ES, TO COMPLY WITH PROVISO THIRTEEN (UN-NUMBERED). ACCORDINGLY, IT HAS TO BE ASCERTAINED WHETHER THE EDUCATIONAL INSTITUTION HAS BEEN APPLYI NG ITS PROFIT WHOLLY 5 ITA NO. 3708/DEL/2015 AND EXCLUSIVELY TO THE OBJECT FOR WHICH THE INSTITU TION IS ESTABLISHED. MERELY BECAUSE AN INSTITUTION HAS EARNED PROFIT WOU LD NOT BE DECIDING FACTOR TO CONCLUDE THAT THE EDUCATIONAL INSTITUTION EXISTS FOR PROFIT. (2) THE PROVISIONS OF SECTION 10(23C)(VI) OF THE ACT A RE ANALOGOUS TO THE ERSTWHILE SECTION 10(22) OF THE ACT, AS HAS BEEN LA ID DOWN BY HON'BLE THE SUPREME COURT IN THE CASE OF AMERICAN HOTEL AND LODGING ASSOCIATION (SUPRA). TO DECIDE THE ENTITLEMENT OF AN INSTITUTI ON FOR EXEMPTION UNDER SECTION 10(23C)(VI) OF THE ACT, THE TEST OF PREDOMINANT OBJECT OF THE ACTIVITY HAS TO BE APPLIED BY POSING THE QUESTION WHETHER IT EXISTS SOLELY FOR EDUCATION AND NOT TO EARN PROF IT [SEE 5-JUDGES CONSTITUTION BENCH JUDGMENT IN THE CASE OF SURAT ART SILK CLOTH MANUFACTURERS ASSOCIATION (SUPRA)]. IT HAS TO BE BORNE IN MIND THAT MERELY BECAUSE PROFITS HAVE RESULTED FROM THE ACTIV ITY OF IMPARTING EDUCATION WOULD NOT RESULT IN CHANGE OF CHARACTER O F THE INSTITUTION THAT IT EXISTS SOLELY FOR EDUCATIONAL PURPOSE. A WORKABL E SOLUTION HAS BEEN PROVIDED BY HON'BLE THE SUPREME COURT IN PARA 33 OF ITS JUDGMENT IN AMERICAN HOTEL AND LODGING ASSOCIATION'S CASE (SUPRA). THUS, ON AN APPLICATION MADE BY AN INSTITUTION, THE PRESCRIBED AUTHORITY CAN GRANT APPROVAL SUBJECT TO SUCH TERMS AND CONDITIONS AS IT MAY DEEMS FIT PROVIDED THAT THEY ARE NOT IN CONFLICT WITH THE PRO VISIONS OF THE ACT. THE PARAMETERS OF EARNING PROFIT BEYOND 15% AND ITS INV ESTMENT WHOLLY FOR EDUCATIONAL PURPOSES MAY BE EXPRESSLY STIPULATED AS PER THE STATUTORY REQUIREMENT. THEREAFTER THE ASSESSING AUTHORITY MAY ENSURE COMPLIANCE OF THOSE CONDITIONS. THE CASES WHERE EXE MPTION HAS BEEN GRANTED EARLIER AND THE ASSESSMENTS ARE COMPLETE WI TH THE FINDING THAT THERE IS NO CONTRAVENTION OF THE STATUTORY PROVISIO NS, NEED NOT BE REOPENED. HOWEVER, ALTER GRANT OF APPROVAL IF IT CO MES TO THE NOTICE OF THE PRESCRIBED AUTHORITY THAT THE CONDITIONS ON WHI CH APPROVAL WAS GIVEN, HAVE BEEN VIOLATED OR THE CIRCUMSTANCES MENT IONED IN 13TH PROVISO EXISTS, THEN BY FOLLOWING THE PROCEDURE ENV ISAGED IN 13TH PROVISO, THE PRESCRIBED AUTHORITY CAN WITHDRAW THE APPROVAL. (3) THE CAPITAL EXPENDITURE WHOLLY AND EXCLUSIVELY TO THE OBJECTS OF EDUCATION IS ENTITLED TO EXEMPTION AND WOULD NOT CO NSTITUTE PART OF THE TOTAL INCOME. (4) THE EDUCATIONAL INSTITUTIONS, WHICH ARE REGISTERED AS A SOCIETY, WOULD CONTINUE TO RETAIN THEIR CHARACTER AS SUCH AN D WOULD BE ELIGIBLE TO APPLY FOR EXEMPTION UNDER SECTION 10(23C)(VI) OF THE ACT. [SEE PARA 8.7 OF THE JUDGMENT-ADITANAR EDUCATIONAL INSTITUTION CASE (SUPRA)] 6 ITA NO. 3708/DEL/2015 (5) WHERE MORE THAN 15% OF INCOME OF AN EDUCATIONAL IN STITUTION IS ACCUMULATED ON OR AFTER 1ST APRIL, 2002, THE PERIOD OF ACCUMULATION OF THE AMOUNT EXCEEDING 15% IS NOT PERMISSIBLE BEYOND FIVE YEARS, PROVIDED THE EXCESS INCOME HAS BEEN APPLIED OR ACCU MULATED FOR APPLICATION WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF EDUCATION. 6) THE JUDGMENT OF UTTRAKHAND HIGH COURT RENDERED I N THE CASE OF QUEENS EDUCATIONAL SOCIETY (SUPRA) AND THE CONNECTED MATTERS, IS NOT APPLICABLE TO CASES FALI WITHIN THE PROVISION OF SE CTION 10(23C)(VI) OF THE ACT. THERE ARE VARIOUS REASONS, WHICH HAVE BEEN DIS CUSSED IN PARA 8.8 OF THE JUDGMENT, AND THE JUDGMENT OF ALLAHABAD HIGH COURT RENDERED IN THE CASE OF CITY MONTESSORI SCHOOL (SUPRA) LAYS DOWN THE CORRECT LAW.' AND FINALLY HELD: 8.15 AS A SEQUEL TO THE AFORESAID DISCUSSION, THES E PETITIONS ARE ALLOWED AND THE IMPUGNED ORDERS PASSED BY THE CHIEF COMMISSIONER OF INCOME TAX WITHDRAWING THE EXEMPTION GRANTED UNDER SECTION 10(23C)(IV) OF THE ACT ARE HEREBY QUASHED. HOWEVER, THE REVENUE IS AT LIBERTY TO PASS ANY FRESH ORDERS, IF SUCH A NECESSI TY IS FELT AFTER TAKING INTO CONSIDERATION THE VARIOUS PROPOSITIONS OF LAW CULLED OUT BY US IN PARA 8.13 AND VARIOUS OTHER PARAS. 8.16 THE WRIT PETITIONS STAND DISPOSED OF IN THE AB OVE TERMS. 24. THE VIEW OF THE PUNJAB AND HARYANA HIGH COURT H AS BEEN FOLLOWED BY THE DELHI HIGH COURT IN ST. LAWRENCE EDUCATIONAL SOCIETY (REGD.) V. COMMISSIONER OF INCOME TAX & ANR., (2011) 53 DTR (DEL) 130. ALSO IN TOLANI EDUCATION SOCIETY V. DEPUTY DIRECTOR OF INCO ME TAX (EXEMPTION) & ORS., ( 2013) 351 ITR 184, THE BOMBAY HIGH COURT HAS EXPRES SED A VIEW IN LINE WITH THE PUNJAB AND HARYANA HIGH COURT VIEW, F OLLOWING THE JUDGMENTS OF THIS COURT IN THE SURAT ART SILK MANUF ACTURERS ASSOCIATION CASE AND ADITANAR EDUCATIONAL INSTITUTION CASE AS FOLLOWS: ..THE FACT THAT THE PETITIONER HAS A SURP LUS OF INCOME OVER EXPENDITURE FOR THE THREE YEARS IN QUESTION, C ANNOT BY ANY STRETCH OF LOGICAL REASONING LEAD TO THE CONCLUSION THAT THE P ETITIONER DOES NOT EXIST SOLELY FOR EDUCATIONAL PURPOSES OR, AS THAT CHIEF C OMMISSIONER HELD THAT THE PETITIONER EXISTS FOR PROFIT. THE TEST TO BE AP PLIED IS AS TO WHETHER THE PREDOMINANT NATURE OF THE ACTIVITY IS EDUCATIONAL. IN THE PRESENT CASE, THE SOLE AND DOMINANT NATURE OF THE ACTIVITY IS EDUCATI ON AND THE PETITIONER EXISTS SOLELY FOR THE PURPOSES OF IMPARTING EDUCATI ON. AN INCIDENTAL SURPLUS WHICH IS GENERATED, AND WHICH HAS RESULTED IN ADDIT IONS TO THE FIXED 7 ITA NO. 3708/DEL/2015 ASSETS IS UTILIZED AS THE BALANCE-SHEET WOULD INDIC ATE TOWARDS UPGRADING THE FACILITIES OF THE COLLEGE INCLUDING FOR THE PUR CHASE OF LIBRARY BOOKS AND THE IMPROVEMENT OF INFRASTRUCTURE. WITH THE ADVANCE MENT OF TECHNOLOGY, NO COLLEGE OR INSTITUTION CAN AFFORD TO REMAIN STAGNAN T. THE INCOME-TAX ACT 1961 DOES NOT CONDITION THE GRANT OF AN EXEMPTION U NDER SECTION 10(23C)ON THE REQUIREMENT THAT A COLLEGE MUST MAINT AIN THE STATUS-QUO, AS IT WERE, IN REGARD TO ITS KNOWLEDGE BASED INFRASTRU CTURE. NOR FOR THAT MATTER IS AN EDUCATIONAL INSTITUTION PROHIBITED FROM UPGRA DING ITS INFRASTRUCTURE ON EDUCATIONAL FACILITIES SAVE ON THE PAIN OF LOSING T HE BENEFIT OF THE EXEMPTION UNDER SECTION 10(23C). IMPOSING SUCH A CONDITION WH ICH IS NOT CONTAINED IN THE STATUTE WOULD LEAD TO A PERVERSION OF THE BASIC PURPOSE FOR WHICH SUCH EXEMPTIONS HAVE BEEN GRANTED TO EDUCATIONAL INSTITU TIONS. KNOWLEDGE IN CONTEMPORARY TIMES IS TECHNOLOGY DRIVEN. EDUCATIONA L INSTITUTIONS HAVE TO MODERNISE, UPGRADE AND RESPOND TO THE CHANGING ETHO S OF EDUCATION. EDUCATION HAS TO BE RESPONSIVE TO A RAPIDLY EVOLVIN G SOCIETY. THE PROVISIONS OF SECTION 10(23C) CANNOT BE INTERPRETED REGRESSIVELY TO DENY EXEMPTIONS. SO LONG AS THE INSTITUTION EXISTS SOLEL Y FOR EDUCATIONAL PURPOSES AND NOT FOR PROFIT, THE TEST IS MET. 25. WE APPROVE THE JUDGMENTS OF THE PUNJAB AND HARYANA, DELHI AND BOMBAY HIGH COURTS. SINCE WE HAVE SET ASIDE THE JUD GMENT OF THE UTTARAKHAND HIGH COURT AND SINCE THE CHIEF CITS OR DERS CANCELLING EXEMPTION WHICH WERE SET ASIDE BY THE PUNJAB AND HA RYANA HIGH COURT WERE PASSED ALMOST SOLELY UPON THE LAW DECLARED BY THE UTTARAKHAND HIGH COURT, IT IS CLEAR THAT THESE ORDERS CANNOT ST AND. CONSEQUENTLY, REVENUES APPEALS FROM THE PUNJAB AND HARYANA HIGH COURTS JUDGMENT DATED 29.1.2010 AND THE JUDGMENTS FOLLOWING IT ARE DISMISSED. WE REITERATE THAT THE CORRECT TESTS WHICH HAVE BEEN CU LLED OUT IN THE THREE SUPREME COURT JUDGMENTS STATED ABOVE, NAMELY, SURAT ART SILK CLOTH, ADITANAR, AND AMERICAN HOTEL AND LODGING, WOULD ALL APPLY TO DETERMINE WHETHER AN EDUCATIONAL INSTITUTION EXISTS SOLELY FO R EDUCATIONAL PURPOSES AND NOT FOR PURPOSES OF PROFIT. IN ADDITION, WE HAS TEN TO ADD THAT THE 13 TH PROVISO TO SECTION 10(23C) IS OF GREAT IMPORTANCE I N THAT ASSESSING AUTHORITIES MUST CONTINUOUSLY MONITOR FROM ASSESSME NT YEAR TO ASSESSMENT YEAR WHETHER SUCH INSTITUTIONS CONTINUE TO APPLY THEIR INCOME AND INVEST OR DEPOSIT THEIR FUNDS IN ACCORDANCE WIT H THE LAW LAID DOWN. FURTHER, IT IS OF GREAT IMPORTANCE THAT THE ACTIVIT IES OF SUCH INSTITUTIONS BE LOOKED AT CAREFULLY. IF THEY ARE NOT GENUINE, OR AR E NOT BEING CARRIED OUT IN ACCORDANCE WITH ALL OR ANY OF THE CONDITIONS SUBJEC T TO WHICH APPROVAL HAS BEEN GIVEN, SUCH APPROVAL AND EXEMPTION MUST FORTHW ITH BE WITHDRAWN. ALL THESE CASES ARE DISPOSED OF MAKING IT CLEAR THA T REVENUE IS AT LIBERTY TO 8 ITA NO. 3708/DEL/2015 PASS FRESH ORDERS IF SUCH NECESSITY IS FELT AFTER T AKING INTO CONSIDERATION THE VARIOUS PROVISIONS OF LAW CONTAINED IN SECTION 10(23C) READ WITH SECTION 11 OF THE INCOME TAX ACT. IT IS PERTINENT TO NOTE THAT THE MAIN OBJECTS OF TH E TRUST ARE TO ENCOURAGE BACKWARD AND DISCARDED PEOPLE TOWARDS EDUCATION AND SOCIAL DEVELOPMENT WORKS, HELPING CHILDREN BY PROVIDING EDUCATION AND LIVELIHOOD TO THEM ETC. THE SAME WAS AT NO POINT AMENDED BY THE ASSESSEE. ALSO THE TRUST RUNS A COLLEGE THAT HELPS IN ENHANCING THE FUTURE OF STUDENTS BY P ROVIDING THE EDUCATION AND MAKING AVAILABLE THE DIPLOMA COURSES IN POLYTECHNIC AND ENGINEERING WHICH ARE DULY APPROVED BY AICTE. HENCE ALL OBJECTS ARE I N CONSIDERATION FOR GRANTING THE APPROVAL U/S 10(23C)(VI) OF THE ACT. THEREFORE, THE ISSUE IN THE PRESENT CASE IS SQUARELY COVERED BY THE DECISION OF THE HONBLE APEX COURT. THE APPEAL OF THE ASSESSEE IS ALLOWED. 8. IN RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH JANUARY, 2018 . SD/- SD/- (G. D. AGRAWAL) (SUCHITRA KAMBLE) PRESIDENT JUDICIAL MEMBER DATED: 30/01/2018 R. NAHEED * COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR 9 ITA NO. 3708/DEL/2015 ITAT NEW DELHI DATE 1. DRAFT DICTATED ON 07/12/2017 PS 2. DRAFT PLACED BEFORE AUTHOR 11/12/2017 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER .2017 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 30.01.2018 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK 31 .01.2018 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.