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2024 (5) TMI 498 - AT - Income TaxExemption u/s 10(23C)(iiiad) - Threshold limit of Rs. 1 Crore - denial of exemption as gross receipts of the assessee exceed the stipulated limit of Rs. 1 crore - DR argued that the assessee society is running educational institutions with single PAN therefore the gross receipts of the assessee required to be considered for the purpose of section 10(23C)(iiiad) and assessee neither has registration u/s 12A nor any approval u/s 10(23C)(vi) of the Act to claim exemption u/s 10(23C)(iiiad) of the Act as the gross receipts of the assessee exceeded Rs. 1 crore - HELD THAT - The gross receipts of the society from Degree college was Rs. 84, 81, 714/- and the junior college was Rs. 18, 66, 811/- which has not exceeded the threshold limit of Rs. 1 crore individually or even put together if the receipts pertaining to F.Y.2015- 16 amounting to Rs. 10, 82, 585/- were excluded from the gross receipts of Rs. 1, 03, 48, 525 and the balance comes to Rs. 92, 65, 940/-. Thus as the gross receipts of the assessee society did not exceed the threshold limit of Rs. 1 crore. Hence respectfully following the decision of St.Mary s English Medium School Society 2020 (2) TMI 1139 - ITAT VISAKHAPATNAM we hold that the assessee is entitled for exemption u/s 10(23C)(iiiad) of the Act - Decided in favour of assessee.
Issues Involved:
The issue involves the eligibility of the assessee for exemption u/s 10(23C)(iiiad) of the Income Tax Act, 1961 based on the gross receipts exceeding the threshold limit of Rs. 1 crore and the absence of registration u/s 12A or approval u/s 10(23C)(vi) for claiming income exemption. Summary of Judgment: Issue 1: Eligibility for Exemption u/s 10(23C)(iiiad) of the Act The appeal was filed against the order of the Commissioner of Income Tax (Appeals) regarding the eligibility of the assessee for exemption u/s 10(23C)(iiiad) of the Act. The assessee, a society running educational institutions, claimed exemption based on the gross receipts not exceeding Rs. 1 crore individually or combined. The Assessing Officer (AO) had assessed the taxable income of the assessee at Rs. 12,54,981 after considering the total receipts exceeding the threshold limit. The Ld.CIT(A) dismissed the appeal, but the Tribunal, after considering similar precedents, held in favor of the assessee. The Tribunal emphasized that each educational institution should be considered separately for the exemption, and if the receipts of each institution do not exceed Rs. 1 crore, the income should not be included in the total income of the assessee. Therefore, the Tribunal allowed the appeal of the assessee, holding them entitled to exemption u/s 10(23C)(iiiad) of the Act. Issue 2: Disallowance of Donations The assessing officer had made an addition of Rs. 27,850 towards disallowance of donations. However, this issue was not pressed by the assessee and was dismissed as not pressed. Issue 3: Taxation at Maximum Marginal Rate The assessee raised a ground related to the taxation of total income at the maximum marginal rate instead of the normal rates applicable to the appellant society. This ground was dismissed as not pressed by the assessee. Conclusion: The Tribunal allowed the appeal of the assessee concerning the eligibility for exemption u/s 10(23C)(iiiad) of the Act based on the gross receipts not exceeding the prescribed limit of Rs. 1 crore for each educational institution. The Tribunal set aside the order of the Ld.CIT(A) and held the assessee entitled to the exemption. Other issues regarding disallowance of donations and taxation rates were not pressed by the assessee and were dismissed accordingly.
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