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TMI Blog2018 (9) TMI 1400X X X X Extracts X X X X X X X X Extracts X X X X ..... ctly apply the provisions of section 10(23C)(iiiab) and to examine and verify whether the educational institution run by the assessee, irrespective of the other activity of running of the hotel of the assessee, is run solely for educational purposes and not for profit and whether the said institution is substantially financed by the Government - Decided in favour of assessee for statistical purposes. - ITA No. 462/CHD/2017 And ITA No. 1021/CHD/2016 - - - Dated:- 21-8-2018 - SHRI SANJAY GARG, JUDICIAL MEMBER AND Dr . B. R. R. KUMAR, ACCOUNTANT MEMBER For The Appellant : Sh. Rakesh Khanna, CA For The Respondent : Sh. Manoj Mishra, CIT DR ORDER Per Sanjay Garg, Judicial Member: The present appeals has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. He observed that to claim exemption u/s 10(23C)(iiiab), the educational institution must be solely for the purpose of education and without any profit motive. He further observed that though the assessee had been running hotel management course, yet, simultaneously running profitable hotel in the name of Chandigarh Hotel Beckons. Also the institute had been providing mid-day meal for government schools of Chandigarh Administration and these activities could not be said for educational purpose. Chandigarh Hotel Beckons was being run on commercial basis to earn huge profit and there was no objects shown in MOA of the assessee of running of a hotel. The Assessing officer held that assessee was not existing solely for the purpose of educat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act for the assessment years 2009-10, 2010-11 and 2012-13. However, for the year under consideration, the claim of exemption has been wrongly denied to the assessee. It has been further claimed that earlier the assessee society has been running the educational institution only. However, in the year 2007, the assessee society apart from its educational institution, established The Hotel Chandigarh Beckons (a unit of CIHM, Chandigarh) for providing hands on experience to the students of the Institute. As such from 2007, the society started running its hotel activity apart from its educational institute and both the activities are being run separately as two separate divisions of the society and even books of account are maintained separatel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tified in respect of receipts of the educational institute as the same are received for funding of the educational activity only of the assessee. 9. To arrive at the proper conclusion, we deem its fit to reproduce here the relevant provisions of the Section 10(23C)(iiiab) of the Act 10. In computing the total income of a previous year of any person, any income falling within any of the following clauses shall not be included- . (23C) any income received by any person on behalf of- . (iiiab) any university or other educational institution existing solely for educational purposes and not for purposes of profit, and which is wholly or substantially financed by the Government; or .. A perusal of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing maintained in respect of educational institution run by it and that it is substantially financed by the Government and is not run for profit. In view of this, the matter requires to be remanded back to the file of the Assessing officer to correctly apply the provisions of section 10(23C)(iiiab) of the Act and to examine and verify whether the educational institution run by the assessee, irrespective of the other activity of running of the hotel of the assessee, is run solely for educational purposes and not for profit and whether the said institution is substantially financed by the Government. If the institute is found to qualify the above conditions of section 10(23C)(iiiab) of the Act, the assessee will be entitled to claim exemption ..... X X X X Extracts X X X X X X X X Extracts X X X X
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