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TMI Blog2019 (5) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... he financial year 2014-15 value of car, motorcycle and scooter were ₹ 2.17 lakhs and in 2015-16, it were ₹ 2.30 lakhs and the society surplus amount was @ 5.52% only, which cannot be termed as higher and certainly to run institute, the vehicles were required. Further, the apprehension and assumption of the CIT(E) that the society must be charging some funds, was based on the assumption and surmises and had no logical reasoning. Accordingly, the Tribunal has rightly directed the CIT(E) to grant registration under Section 12AA No illegality or perversity could be pointed out by learned counsel for the revenue in the findings recorded by the Tribunal which may warrant interference by this Court. No substantial question of law arises in the appeal. - Decided in favour of assessee. - ITA-141-2018 - - - Dated:- 8-4-2019 - MR AJAY KUMAR MITTAL AND MRS MANJARI NEHRU KAUL, JJ. For The Appellant : Mr. Denesh Goyal, Senior Standing Counsel ORDER AJAY KUMAR MITTAL, J. 1. This appeal has been filed by the revenue under Section 260A of the Income Tax Act, 1961 (in short the Act ) again ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of funds towards education? VI. Whether on the facts and in the circumstances of the case and in law, the order of the Appellate Tribunal is contrary to the evidence and material on the record of the case and, therefore, perverse? 2. A few facts necessary for adjudication of the instant appeal as narrated therein may be noticed. The assessee is an educational society registered on 19.9.2003 under the Societies Registration Act, 1860 and since 2003 has been running educational institutes for education. It filed an application dated 15.3.2016 in Form 10A for registration under Section 12AA of the Act. The Commissioner of Income Tax (Exemptions) [for brevity the CIT(E) ] vide order dated 30.9.2016 (Annexure A-1) rejected the said application by observing as under:- 8. XX XX XX ( i) Self confessedly the sole object of the society has been projected as providing education. In that context the applicant had all reasons to apply for exemption under the provision of section 10(23C) (vi) rather than 12AA. This issue gets corrobora ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... both the options were available before it, i.e., either to apply for exemption under Section 10(23C) of the Act or claim exemption under Section 12AA of the Act, it was not justified to decline exemption under Section 12AA that it should have claimed exemption under Section 10(23C) of the Act. For granting exemption under Section 12AA of the Act, the CIT(E) had to satisfied himself about the objects and the genuineness of the activities of the assessee and once the CIT(E) having accepted that the main aim of the society was running of college and educational institutions and made no adverse observation regarding genuineness of the objects or the activities carried on by the society, then the registration under Section 12AA of the Act could not have been denied holding that it was entitled to exemption under any other provision. With regard to the finding of the CIT(E) that the emphasize of the society was mainly creation of assets rather then redeployment of funds towards education, the Tribunal had noticed that during the financial year 2014-15 value of car, motorcycle and scooter were ₹ 2.17 lakhs and in 2015-16, it were ₹ 2.30 lakhs and the society surplus amount was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion was drawn by the Ld. AR to the audited balance sheet, where it is clearly shown that during the F.Y. 2015-16 value of car, motorcycle and scoter were 2.17 lakh and in 2015-16 it were 2.30 lakh and the society surplus amount was @ 5.52 % only. We are in agreement with the assessee that the surplus @ 5.52 % cannot be termed as higher and certainly to run an institute, the vehicles are required, therefore, the observation of the CIT(E) is not correct to the extent that the emphasized of the society has been mainly to add car, motorcycle and scooter. In fact total receipts had been shown at ₹ 182,76,252/- during the F.Y. 2015-16, however, the value of the car, motorcycles and scooter were 2.30 lakh only, therefore, we are of the considered opinion that observation of the CIT(E) was not correct. Another observation of the CIT(E) was that the society is mainly emphasizing for creation of fixed assets rather than redeployment funds towards education. The Ld. AR drawn our attention regarding the receipts, the average annual fee for the F.Y. 2015-16 charged by the assessee was at ₹ 16,525 per student for IIT, B.Com students and ₹ 4,559 per student ..... X X X X Extracts X X X X X X X X Extracts X X X X
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