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TMI Blog2015 (2) TMI 449X X X X Extracts X X X X X X X X Extracts X X X X ..... y be covered by the definition of “charitable purpose”, as defined in Section 2(15) of the Act, as these activities are meant for general public utility, i.e. whoever wants to advance his/her qualifications in the banking industry. From the above details and description, we are of the opinion that the assessee is a charitable organization and eligible for deduction u/s 11 of the Act. - Decided in favour of assessee. - ITA No. : 5725/Mum/2012 - - - Dated:- 11-2-2015 - SHRI RAJENDRA AND SHRI VIVEK VARMA, JJ. For the Appellant : Shri Nitesh Joshi For the Respondent : Shri Kishan Vyas ORDER PER VIVEK VARMA, JM: The appeal is filed by the assessee against the order of CIT(A) 1, Mumbai, dated 29.03.2012, wherein the following grounds have been raised: 1. The grounds of appeal that follow are all independent and without prejudice to each other, 2. Re: Exemption under Section 11: 2.1 That, on the facts and in the circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) erred in upholding the Assessing Officer's action in rejecting the appellant's claim for exemption under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 1998-99, the Institute has claimed Exemption u/s 10(22) as income of a University or other Educational Institution existing solely for educational purposes and not for purposes of profit. The then AO, however, concluded that the institute was set up to encourage the study of the theory of banking and for that purpose it instituted a scheme of examination which is clearly by itself not an educational activity. The assessee company is not imparting any formal education but conducting exams to members for various Diplomas and Certificates. The benefits of passing the examinations are that the banks and financial institutions in the country give additional increment/cash/weightage for promotion to their employees on passing various examinations of the institute. Thus, the assessee in no way promotes any charitable activities for public at large. 3. Accordingly, the then AO disallowed the claim u/s 10(22) for the above assessment years. 4. The Institute was treated as company providing service/professional services and income was therefore taxed as business income. This issue reached the ITAT and the coordinate Bench of the ITAT at Mumbai decided the matter in favour of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied for the following three reasons i.e. the assessee is not pursuing an educational activity, it has generated huge surplus and it is not for the public at large. 10. The assessee made its submissions with respect to each of the aforesaid issues. 11. With respect to the reasoning given by the AO that the assessee is not pursuing an educational activity, the assessee placed reliance upon the decision of the coordinate Bench of the ITAT in its own case in assessment years 1996-97 to 1998-99 (APB 205 to 219), allowing the appeal filed by the assessee against withdrawal of registration under section 12A (APB 231 to 236). In these decisions the Tribunal after considering the facts pertaining to its objects as per its Memorandum of Association, the courses conducted by it and its manner of functioning, concluded that the assessee was pursuing educational activities. The AR therefore, submitted that, in so far the issue pertaining to conduct of educational activities is concerned, the same is covered and concluded in its favour by the ITAT. 12. With respect to the above, the AR drew our attention to the detailed submissions filed by it before the CIT(A), wherein specific referen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , which is reproduced below: If upon the winding up or dissolution of the Institute there remains, after the satisfaction of all its debts and liabilities, any property whatsoever, the same shall not be paid to or distributed among the members of the Institute, but shall be given or transferred to some other institution or institutions having objects similar to the objects of this Institute, and which shall prohibit the distribution of its part of their income and property among its or their members to an extent at least as great as is imposed on the Institute or by virtue of Clause 4 thereof, such institution or institution to be determined by the members of the Institute at or before the time of dissolution, and in default thereof by such Judge of the High Court of Judicature at Bombay or other Judge as may have or acquire jurisdiction, the matter, and if and so far as effect cannot be given to the aforesaid provision then to some charitable object. Held following examination : (a) Associate Examination (CAIIB); (b) Diploma in International Banking; (c) Diploma in Financial Services; (d) Diploma in Bank Management; (e) Certificate in banking Oriented ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the DR, which are City Montessori School vs UOI (supra), DIT(E) vs Ahmedabad Management Association (supra) and DIT vs Samudra Institute of Meritime Studies Trust (supra). Also placing reliance on the decision of Ahmedabad Rana Caste Association vs CIT, reported in 82 ITR 704, wherein it was held, It is well-settled that an object beneficial to a section of the public is an object of general public utility. To serve a charitable purpose it is not necessary that the object should be to benefit the whole of mankind or all persons in a country or State. It is sufficient if the intention to benefit a section of the public as distinguished from a specified individual is present. The section of the community sought to be benefitted must be sufficiently definite and identifiable by some common quality of a public or impersonal nature . The AR submitted that since the assessee was giving benefit to persons perusing banking industry, is not only education but by not making any profit, it was charitable in nature. 21. Since the Institute does not undertake any other activities other than what is stated above. The activities as seen are educational in nature, which leaves no apprehensio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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