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2014 (2) TMI 228 - AT - Income TaxExemption u/s 11 r.w Section 12 of the Act Held that - The decision in Commissioner of Income Tax Versus M/s. All Saints College Society, M/s Sherwood Diocesan College Society 2014 (1) TMI 1081 - UTTARAKHAND HIGH COURT followed - The assessees are trusts established wholly for the purposes of imparting education - They received contributions from their pupils for the purpose of imparting education to them - Merely because the assessees made contributions to other trusts, also registered under Section 12A of the Act and because, in some of the years, their revenue was more than their expenditure; despite non-cancellation of their registration under Section 12A of the Act, the Assessing Authority, in a most blatant manner, held that the assessees are not entitled to the benefits of Sections 11 and 12 of the Act - The order of the Commissioner (Appeals) upheld in holding the assessee society entitled to the benefits of Sections 11 and 12 of the Act Decided against Revenue.
Issues:
Appeals filed by the department for Assessment Years 2008-09 and 2009-10 against orders passed by CIT (A), Dehradun. Single common issue: Exemption u/s 11 read with Section 12 of the IT Act. Analysis: The appeals were filed by the department against the orders passed by the CIT (A), Dehradun for Assessment Years 2008-09 and 2009-10. The main issue in these appeals was the exemption claimed by the assessee AOP under Sections 11 and 12 of the IT Act. The Assessing Officer had rejected the claim by invoking Section 11 (4A) of the Act, stating that the school run by the society was not its object and was operated on a profit basis consistently. The CIT (A) for both years followed the first appellate order for the previous year to allow the claim of the assessee. The department contended that the CIT (A) erred in allowing the exemption under Sections 11 and 12, as Section 11 (4A) was applicable to the assessee society. The department argued that the decision of the Delhi Tribunal in another case was directly applicable to the facts of this case. They also mentioned that issues for other assessment years were pending before the High Court of Uttarakhand. On the other hand, the counsel for the assessee argued that previous tribunal orders and the decision of the High Court of Uttarakhand supported the claim of exemption under Sections 11 and 12. They highlighted that even the department had accepted the claim for a subsequent year. The ITAT considered these contentions and referred to the High Court of Uttarakhand's order dated 17.12.2012, which upheld the benefits of Sections 11 and 12 for trusts established for educational purposes. The High Court's order was crucial as it affirmed the decisions of the Commissioner (Appeals) and the Tribunal, confirming the entitlement of the assessee society to the benefits of Sections 11 and 12 of the Act. The ITAT found no difference in the facts of the present case from those considered by the High Court. Therefore, the ITAT rejected the department's grievance, confirming the orders passed by the CIT (A) for both years. In conclusion, the ITAT dismissed both appeals filed by the department based on the High Court's order and upheld the benefits of Sections 11 and 12 for the assessee society.
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