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TMI Blog2019 (10) TMI 705X X X X Extracts X X X X X X X X Extracts X X X X ..... ter which are relevant for the grant of approval u/s 10(23C)(vi) - As pointed out by the CIT(E) himself in para 4 of the order, that for the purpose of grant of approval under the said section, the applicant needs to specify that it exists solely for educational purposes and not for the purpose of profit. From the entire order of the CIT(E) we find that there is no examination on the aspect of existence of the assessee for imparting education. There are no findings as to how the school was established by the society. Whether affiliation was granted to the school by any Board of Education, if so, the number of students being taught in the school and teachers therein, their qualifications and such other aspects to completely bring out the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bject to the same. 3. Considering the reasonableness of the cause for the delay as also the shortness of the delay, the same was condoned in open court and the hearing of the appeal proceeded with. 4. The facts relating to the case, as emanate from the order of the Ld.CIT(E) are that the assessee was a society registered under the Society s Registration Act XXI of 1860, on 5.1.2000, with the object to impart education, to open schools for the said purpose and to do other activities relating to education. That it had applied for grant of approval u/s 10(23C)(vi) for the purposes of claiming its income exempt u/s 10(23C) of the Act as a University/educational institution existing solely for the purpose of edu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he rival contentions. We have also gone through the order in challenge before us notably the findings of the CI T(E) which are as under: 7. On 19.09.2017, a response was received through email from [email protected] in response to above noted queries stating that the society is solely engaged in providing education and hence qualifies for exemption u/s 10(23C)(vi) and the society had claimed exemption u/s 10(23C)(iiiad) in the preceding years. After considering the written submissions, the following issues emerges from written submissions- (i) Even though it has been claimed that the sole object of the society has been to provide education and not to earn profit, the applicant was claiming wrong ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been to generate surplus beyond what has been held to reasonable in the order of the Apex Court in the case of Islamic Academy of Education another vs. State of Karnataka that pegged reasonable surplus at 6 to 16%. (ii) Further perusal of the submissions revealed that applicant has failed to provide the Receipts and Payment account for the last three years including the Receipt and Payment account, Income Expenditure Account and balance sheet for the F.Y. 2016-17 which were specifically called for. In the absence of same it could not be ascertained whether the certain entries taken directly to the balance sheet required to included in the Aggregate receipts or not. (iii) Further perusal of the submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsertion of such a clause clearly reveals the intent of the applicant society is to add to, from the money claimed to be received from its educational activities, the buildings belonging to a related person. Further, examining of financial statements reveals that the booked amount on account of Rent as on 31.03.2016 was ₹ 96,700/- and ₹ 75,450/- as on 31.03.2015 which is again doubtful to the extent that as per rent agreement the monthly rent was 12,000/- P.M. in that way the Rent needs to be booked at 1,44,000/- 8. Given all of the above the claims of the applicant for approval u/s 10(23C) can't be ascertained. The applicant society doesn't qualify for the label educational institution in the spirit e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vident from the order itself that the Ld.CI T(E) arrived at his findings as above on the basis of information before him and did not even confront the same to the assessee. Moreover a perusal of the order reveals that the Ld.CIT(E) has not carried out any investigation into the matter which are relevant for the grant of approval u/s 10(23C)(vi) of the Act. As pointed out by the Ld.CIT(E) himself in para 4 of the order, that for the purpose of grant of approval under the said section, the applicant needs to specify that it exists solely for educational purposes and not for the purpose of profit. From the entire order of the CIT(E) we find that there is no examination on the aspect of existence of the assessee for imparting education. There a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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