2012 (7) TMI 1026

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..... nted on behalf of the assessee. 2. The only issue in the grounds of appeal of the Revenue is that the Commissioner of Income Tax (Appeals) erred in allowing exemption under section 10(23C)(iiiae) of the Act. 3. The assessee is a registered society filed return of income on 19.09.2008 admitting NIL income after claiming exemption under section 10(23C)(iiiae). The assessment was completed under section 143(3) r.w.s. 147 on 13.12.2010 determining the total income at ₹ 22,73,430/-. While completing the assessment, the Assessing Officer denied the assessee exemption claimed under section 10(23C)(iiiae) stating that the assessee does not solely exist for philanthropic purposes and there is an intention to earn profit. 4. On appeal, .....

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..... exists solely for philanthropic purpose. The counsel submits that the assessee is running hospital providing maternity and child care facility and treatment to the poor. The counsel submits that the properties owned by the assessee society were let out and the rental income was accumulated only for the purpose of utilizing the said income for attainment of the objects of the society and no part of the income was spent for the purpose other than the objects of the society. The counsel submits that earning rental income from the property alone cannot be the basis for denying exemption under section 10(23C)(iiiae) on the ground that the assessee is earning income and attributing profit motive. The counsel submits that the assessee not only acc .....

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..... bers of the society. The condition for allowing exemption under section 10(23C) is that the assessee should engage in the activity of providing medical relief without any profit motive. In the assessee s case, we do not see that the society is engaged in any activity of providing medical relief with profit motive. This issue has been elaborately dealt with by the Commissioner of Income Tax (Appeals) and we see no reason to interfere with the view taken by the Commissioner of Income Tax (Appeals) in allowing the exemption under section 10(23C)(iiiae) to the assessee in the facts and circumstances of the assessee s case. We also see that the case law relied on by the Revenue are not applicable to the facts of the assessee. Therefore, we susta .....

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