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TMI Blog2019 (8) TMI 228X X X X Extracts X X X X X X X X Extracts X X X X ..... stified to uphold the action of the Ld. Assessing Officer in coming to the conclusion that the appellant had not been granted exemption u/s 80G." Further, the assessee has also raised before us the following Additional Ground of appeal: "1. That the Ld. Assessing Officer having not made any addition on account of the facts as stated in the reasons so recorded for the purpose of issuing notice u/s 148 of the Income Tax act, 1961 and therefore, the Assessing Officer could not have the jurisdiction to make other additions, having not made the addition on the basis of which, the reopening had been done. Hence the assessment as framed by the Ld. Assessing Officer is bad in law." As the assessee has assailed the validity of the assessment by way of raising the aforementioned additional ground of appeal, which involves purely a legal issue based on the facts available on record, therefore, the same is being admitted. 2. Briefly stated, the assessee society which is stated to be running an educational institution had filed its return of income for A.Y. 2011- 12 on 30.09.2011, declaring nil income. The return of income filed by the assessee was processed as such under Sec. 143(1) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... education, therefore, it could safely be concluded that it was not existing solely for education purposes which was the basic requirement for claim of exemption under Sec. 10(23C)(iiiad). On the basis of his aforesaid deliberations the A.O was of the view that the activities of the assessee were in the nature of 'business' with a profit motive and not for a charitable purpose as defined in Sec. 2(15) of the IT Act. In the backdrop of his aforesaid observations the A.O declined to allow the claim of exemption raised by the assessee under Sec. 10(23C)(iiiad) and brought the amount of surplus of Rs. 12,66,771/- to tax as its 'business income'. 4. Aggrieved, the assessee carried the matter in appeal before the CIT(A). The CIT(A) after deliberating at length on the contentions advanced by the assessee as regards its entitlement towards claim of exemption under Sec. 10(23C)(iiiad), was however not persuaded to accept the same. The CIT(A) observed that the assessee society which was not running its own educational institution but was running a learning centre on behalf of PTU was engaged in trade, commerce or business on commission basis. In fact, the CIT(A) was of the view that the wor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts only in the name of Registrar, PTU payable at Jalandhar, except for the library fee of Rs. 1,000/- (refundable security). The ld. A.R submitted that from the semester fee collected PTU would pay 45% towards the share of the learning centre after separating the exam fee. Apart there from, it was submitted by the Ld. A.R that the lab charges for the applied technology courses could be charged by the learning centre from the students provided the same was approved by the university. In sum and substance, it was the contention of the Ld. A.R that the assessee as a learning centre of PTU was running a distance learning education programme, and had provided for the specified infrastructure as per the requirements of the university, as well as was responsible for the education delivery to the students by appointing a faculty as specified by the university; design presentations, projects, assignments and conduct internal exams and provide internal assessments; conduct seminars and open house discussions etc. It was the contention of the Ld. A.R that as per the contract of the assessee as a learning centre with the university i.e. PTU there was an arrangement for sharing of the semester ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; (vii) conducting internal exams and providing internal assessment; (viii) conducting seminars and open house discussions from time to time; (ix) follow guidelines, format and instruction issued by PTU and regional centre from time to time; (x) maintain the viability of PTU project at the learning centre; and (xi) responsibility for education delivery. The assessee society being an authorized learning centre has to honour the obligations set out by PTU for providing education to enrolled students and has to employ teachers for taking classes of enrolled students. In fact, the assessee which is an educational institution is imparting education through distance learning route in the society by running a learning centre affiliated to PTU. We have given a thoughtful consideration to the issue before us and are unable to persuade ourselves to subscribe the observations of the lower authorities that the distance learning provided by the assessee to the students in its capacity as a learning centre of PTU would not fall within the realm of the definition of the term 'education' as envisaged in Sec. 2(15) of the IT Act. As per the literal meaning "education" is a process for facilitating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no way lead to recharacterization of the said amount in the hands of the assessee. In sum and substance, the nature of receipt/amount in the hands of the assessee learning centre would continue to be governed and regulated as per its arrangement with the university, and not by the nomenclature given by the university i.e. PTU while making the said payment. We may herein observe that a similar issue was involved in the case before a coordinate bench of the Tribunal i.e. ITAT, Chennai Bench "B" in Soorya Educational Trust Vs. ITO [ITA No. 579 (Mds) of 2012; dated 31.05.2012]. As in the case before us, in the aforementioned case also the assessee was entitled for a share of fees collected by the university i.e. Annamalai University. The assessee in the said case would be imparting oral education to the students by the teachers who would be employed by the assessee. Apart there from, the assessee was maintaining the attendance of the students in order to render them eligible to write the examination. Further, the curriculam and conduct of programmes as in the case before us was the responsibility of the assessee in the aforementioned case. Interestingly, in the aforementioned case also ..... X X X X Extracts X X X X X X X X Extracts X X X X
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