ITAT reversed CIT(A)'s decision and upheld AO's denial of ...

Trust's Hostel Operations Generating Rs 6.21 Crore Surplus Disqualifies Section 10(23C)(vi) Educational Institution Tax Exemption

March 3, 2025

Case Laws Income Tax AT

ITAT reversed CIT(A)'s decision and upheld AO's denial of exemption under section 10(23C)(vi). While providing education and integrated hostel facilities qualifies as charitable activity, operating hostels separately on commercial basis constitutes business activity. Following Supreme Court's precedent in Ahmedabad Urban Development Authority case, ITAT held that charging substantially higher fees over cost amounts to "trade, commerce or business." The Trust's hostel operations generating surplus of Rs. 6.21 crores exceeded mere cost recovery with nominal markup. Since commercial activities were not incidental to educational purposes and exceeded 20% threshold under section 2(15), the Trust failed to meet "solely educational purposes" requirement. Revenue's appeal allowed.

View Source

← Previous Next →

ITAT reversed CIT(A)'s decision and upheld AO's denial of ...

Trust's Hostel Operations Generating Rs 6.21 Crore Surplus Disqualifies Section 10(23C)(vi) Educational Institution Tax Exemption

March 3, 2025

Case Laws Income Tax AT

You may also like:

The Lok Sabha passed the Finance Bill 2025 with 35 government amendments, including the abolition of a 6% digital tax on online advertisements. This completes the lower...

Exemption u/s 10(23C)(vi) - there has been no exercise done by the Department either at first instance or at least on review petition to find out as to whether the Trust...

Exemption u/s 10 (23C) (vi) - generation of surplus from year to year - the court referred to precedents and a clarificatory circular issued by the Ministry of Finance....

Exemption under Section 10 (23C) (vi) refused - if surplus is generated year after year, it cannot be said to be existing solely for educational purposes - exemption denied - HC

Benefit of exemption - Approval u/s 10(23C)(vi) was granted to trust as a whole or for specified institution only - We are in complete agreement with the ld....

Exemption u/s. 10(23C)(vi) - Assessee Trust having multiple objects cannot be said to be existing “solely for the purpose of education”. It is open to the trust to...

Assessment u/s 153A - benefit of exemption u/s 11 - Bogus purchases - even if the benefits of section 11 is denied than too there can be no income of the appellant trust...

Exemption u/s 10 (23C) (vi) - Burden lies upon the Revenue to bring on record the evidence to rebut the claim of the Appellant Trust and to establish that the activities...

Direct tax collections for FY 2023-24 as of 17.06.2023 show net collections of Rs. 3,79,760 crore, a growth of 11.18% compared to the preceding year. - Gross collections...

Penalty u/s 271B - no tax audit conducted u/s 44AB - bonafide belief - When Gross profit is more than Rs.4 crores, it means the Gross Receipts were definitely more than...

Exemption u/s 11 - whether the hostel activity of the trust which is imparting dental education in the institution established by it is a business activity incidental to...

Corpus donations received by the trust for running Kalyana Mandapam were voluntary in nature and could not be treated as rental receipts. Although the activity generated...

Court set aside auction sale on equitable grounds as entire amount due was deposited by respondents. Appellant deprived of using Rs.81,20,000 from 21.07.2019 till...

The GoI through DPIIT has revised eligibility criteria for Industrial Entrepreneurs Memorandum (IEM) acknowledgment, increasing investment thresholds for large-scale...

Exemption u/s.10(23)(vi) - The assessee-trust does not have profit motive, the small profit generated while carrying out charitable activities, does not mean that...

Quick Updates: