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TMI Blog2020 (2) TMI 423X X X X Extracts X X X X X X X X Extracts X X X X ..... he Revenue : Shri R.S. Ambedkar, Sr.DR ORDER PER MANISH BORAD, AM. The above captioned appeals filed at the instance of assessee(s) are directed against the orders of Ld. Commissioner of Income Tax (Exemption) (in short Ld.CIT(E) ], Bhopal dated 27.09.2018 . 2. Assessee(s) has raised following grounds of appeal; Krishna Avanti Educational Society,ITA No.910/Ind/2018 1. The Ld. CIT has erred in rejecting the application under section 80G(5)(vi) inspite of the trust having compiled with requirement of section 80G(5) read with Rule 11AA. 2. The Ld. CIT has erred in rejecting the application merely because assessee society is running education institution and charging fees. Appellant craves leave to add/alter/modify ground of appeal before the final disposal of appeals. Avantika Krishi Gauraksha Trust, ITA No.911/Ind/2018 1. The Ld. CIT has erred in rejecting the application under section 80G(5)(vi) inspite of the trust having compiled with requirement of section 80G(5) read with Rule 11AA. 2. The Ld. CIT has erred in rejecting the application merely because assessee society is running education institution and charging f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e No. 2013-14 (32,652.00) (32,652.00) 89 2014-15 6,022.00 (26,630.00) 82 2015-16 34,024.00 7,574.00 76 2016-17 (4,83,084.85) (4,75,510.85) 178 2017-18 (2,91,736.04) (7,67,256.89) 173 That the Appellants relies on the various documents filed before Hon'ble CIT (Exemptions), which are listed in the annexure. Avantika Krishi Gauraksha Trust That the Appellant Trust is a trust ( Copy of Trust deed at at paper book pg. 7 to 21). That the appellant is registered under section 12AA of the Income Tax Act, 1961 (paper Book pg. 165 166) That the Appellant complies with all the conditions laid down in clauses (i) to (v) of sub-section S of section 80G of the Act. Thus, the appellant meets the requirement for being approved under section 80G, as prescribed u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ish educational institutions (iii) to provide facilities to old age people (iv) to publish distribute vedik books etc. 12. From perusal of the order of Ld. CIT(Exemption) we observe that he has not made any observations justifying that the assessee has not complied to the main objects for which it is running. The activities have been duly undertaken. All; necessary records in the form of books of accounts, audited balance sheet and other documentary evidences to support that charitable activities are being consistently carried out in the past are maintained. 13. The sole reason for which the Ld. CIT(Exemption) has denied the approval of 80G (5)(vi) of the Act is by way of observing that since assessee society is running educational institution and fee is being charged from students against such services, there is no justification is seen to seek exemption u/s 80G of the Act. The assessee trust is also not been able to justify the case for seeking approval u/s 80G . The above remarks of Ld. CIT(Exemption) are too general and by no canon can be a specific observation sufficient enough to deny the approval to assessee u/s 80G(5)(vi) of the Act. 14. Charitable ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or clause (23AA)] 5 or clause (23C)] of section 10: 6 Provided that where an institution or fund derives any income, being profits and gains of business, the condition that such income would not be liable to I nclusion in its total income under the provisions of section 1 1 shall not apply in relation to such income, if,- (a) the institution or fund maintains separate books of account in respect of such business; (b) the donations made to the institution or fund are not used by it, directly or indirectly, for the purposes of such business; and (c) the institution or fund issues to a person making the donation a certificate to the effect that it maintains separate books of account in respect of such business and that the donations received by it will not be used, directly or indirectly, for the purposes of such business;]] (ii) the instrument under which the institution or fund is constituted- does not, or the rules governing the institution or fund do not, contain any provision for the transfer of application at any time of the whole or any part of the income or assets of the institution or fund for any purpose other than a charitable purpose; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e applied- the purpose of education should not be submerged by a profit making motive. iii. A distinction must be drawn between the making of a surplus and an institution being varied on for profit . No inference arises that merely because imparting education results in making a profit, it becomes an activity for profit. iv. If after meeting expenditure, a surplus arises incidentally from the activity carried on by the educational institution, it will not cease to be one existing solely for educational purposes. v. The ultimate test is whether on an overall view of the matter in the concerned assessment year the object is to make profit as opposed to educating person. 19. The above judgment of Hon'ble Apex Court is sufficient enough to brush aside the observation of Ld. CIT(Exemption) in the impugned orders. 20. We therefore in the given facts and circumstances of the case and on observing that both the assessee(s) are running with the main object of carrying out charitable activities as provided u/s 2(15) of the Act and also since Ld. CIT(Exemption) failed to prove that assessee has not fulfilled the conditions u/s 80G(5) (i) to (iv) of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X
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