M/s Sree Sivananda Vidya Peeth, V. The Chief Commissioner of Income-Tax-II

WP/22414/2011

AI Insights

The case involves M/s. Sree Sivananda Vidya Peeth, a registered society, which sought approval under Section 10(23C)(vi) of the Income Tax Act, 1961 to claim exemption of its income for the assessment years 2009-10 onwards. The application was initially filed on 20-08-2009 but was rejected by the 1st respondent on 23-08-2010. The rejection was based on the grounds that the society's objectives, which include medical relief and assistance to the poor, do not solely pertain to educational purposes as required by the section of the Act under which they sought exemption. The society challenged this decision through a writ petition, which was dismissed by the court.

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 740139 (HC-ANDHRA_PRADESH)
• Appeal Type: Others
• Pronouncement Date: 18-07-2012
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: J V PRASAD
• Assessee Lawyers: A V KAUNDINYA
• Keywords: Application rejection; Educational purposes; Income tax exemption; Non-profit society
• Section: 10(23C)(vi)

Judgement Text

" THE HON’BLE SRI JUSTICE GODA RAGHURAM AND THE HON’BLE SRI JUSTICE M.S. RAMACHANDRA RAO W.P.No. 22414 of 2011 Dated 18-07-2012 Between: M/s. Sree Sivananda Vidya Peeth, S.No. 282/1 & 283, NH 9 Road, Opp: Reliance Petrol Bunk, Gattu Bhimavaram (Post), Vatsavai Mandal, Krishna District, Rep., by its Secretary, K. Satyanarayana Rao, s/o Jalaiah. …Petitioner Vs. The Chief Commissioner of Income Tax-II, Hyderabad-1, I.T. Towers, A.C. Guards, Hyderabad and others. …Respondents THE HON’BLE SRI JUSTICE GODA RAGHURAM AND THE HON’BLE SRI JUSTICE M. S. RAMACHANDRA RAO W.P.No. 22414 of 2011 Dated: 18-07-2012 ORAL ORDER: (Per: GR,J) The 1st respondent by the proceedings impugned bearing reference F.No.CCIT-ii/Tech/10(23C)/3/09-10 dated 23-08-2010 rejected the application of the petitioner/society for grant of approval under Section 10 (23C) (vi) of the Income Tax Act, 1961 (for short ‘the Act’), for the assessment years 2009-10 onwards. On 20-08-2009, the petitioner filed an application in Form No.56D seeking approval for itself to enable it to claim exemption of its income, under Section 10 (23C) (vi) of the Act. On 06-08-2010 the 1st respondent who is the prescribed/competent authority issued a notice to the petitioner/society proposing rejection of its application and soliciting objections for the said proposal. The petitioner submitted its response to the notice on 16-08-2010 whereupon the impugned order was passed rejecting the petitioner’s application. The petitioner is a registered society under the provisions of the Andhra Pradesh Societies Registration Act, 2001 (Act No. 35 of 2001) bearing registration No. 250 of 2007; is operating under the Certificate of Registration dated 14-10-2007 issued by the competent authority under the provisions of the A.P.Act 35 of 2001. The Memorandum of Association of the petitioner/society sets out its aims and objects in paragraph No.3 thereof. Clause (B) and (C) of the Aims and Objects of the petitioner/society include establishing, maintenance, running, developing, improving and extending grant, donate and aid in the establishment etc., of hospitals, clinics, dispensaries, medical laboratories, research units and similar institutions; affording treatment, cure, rest, recuperation and other medical relief to the public, including relief and aid to the physically handicapped, the aged and mentally retarded. Sub-clause (c) of Clause (B) of paragraph No.3 of the memorandum of association incorporates the objects of: organizing, running and assisting in organizing and running of free medical camps in rural areas. Clause (C) bears the marginal heading ‘relief of the poor’ and enumerates the following objects of the petitioner/society. a) To conduct feeding of the poor and to give food, clothing and cash grants and donations for the support of the inmates of orphanages, rescue and rehabilitation centers and similar institutions. b) Assisting the poor by way of teaching of arts, crafts engineering similar skills and industrial training including on the job training. c) To provide, relief by giving cash grants in times of natural calamities like earthquakes, floods, famines etc., Clause (D) also enumerates objects of general public utility like establishing, running and aiding free public reading rooms and libraries. Sub-clause (b) of Clause (D) enumerates the objects of building, establishing, constructing, repairing, rebuilding takeover and maintenance of community halls, prayer halls and mandapams to which all sections of public will have access, without restrictions on the ground of caste, religion or creed and for the management thereof. The 1st respondent rejected the application of the petitioner/society on the ground that the petitioner/society does not exist solely for educational purposes, since the aims and objects set out purposes other than educational purposes as well. We find no infirmity in the reasons recorded by the 1st respondent for rejecting the petitioner’s application. Accordingly the writ petition being devoid of merits is dismissed, after hearing Sri A.V. Krishna Kaundinya, learned counsel for the petitioner and Sri J.V. Prasad, learned senior standing counsel for respondents, but in the circumstances without costs. __________________________ JUSTICE GODA RAGHURAM _________________________________ JUSTICE M.S. RAMACHANDRA RAO Dated: 18-07-2012 Pvks/* "