Rajasthan High Court - Jaipur
Shree Multan Jain Shwetambar Sabha vs Commissioner Of Income Tax Exemptions on 5 December, 2017
Author: K.S. Jhaveri
Bench: K.S. Jhaveri
HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT
JAIPUR
D.B. Income Tax Appeal No. 219 / 2017
Shree Multan Jain Shwetambar Sabha, Havig Its Registered
Address At K-8-B, Muni Jayanand Marg, Fateh Tiba, Adarsh Nagar,
Jaipur 302004 Through Its Secretary Shri Nem Kumar Jain, S/o
Shri Ishwar Lal Jain.
----Appellant
Versus
Commissioner of Income Tax, Exemptions, Jaipur Having Its
Address At Kailash Heights, 3rd Floor, Lal Kothi, Tonk Road, Jaipur.
----Respondent
_____________________________________________________ For Appellant(s) : Mr. Siddharth Ranka For Respondent(s) : Mr. Daksh Pareek for Mr. Sameer Jain _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE MR. JUSTICE VIJAY KUMAR VYAS Order 05/12/2017
1. By way of this appeal, the appellant has challenged the judgment and order of the Tribunal whereby the Tribunal has dismissed the appeal of the assessee.
2. This Court while admitting the appeal on 09.10.2017 framed following substantial question of law:-
" Whether on the facts and in the circumstances of the case, the ld. ITAT was correct in law in confirming the denial of registration u/s 12AA of the Income Tax Act, 1961 to the assessee appellant society?"
3. The main ground on which registration was refused was clause ¼v½ which reads as under:-
ÞJh eqyrku tSu 'osrkEcj lHkk ¼jft-½ jftLVsªs'ku uEcj 855 (2 of 16) [ITA-219/2017] t;iqj fo/kku 3- lHkk ds mís';% ¼v½ tSu lekt o /keZ dks vk?kkr igqp a kus okys dkuwuksa dk fojks/k djukAÞ
4. When the matter was admitted an assurance was given by an undertaking by the management i.e. appellant, duly supported by resolution which reads as under:-
" I, Nem Kumar Jain, aged about 70 years, S/o Shri Ishwar Lal Jain, r/o 550/7, Shanti Vihar, Flat No. 2, Udai Marg, Raja Park, Jaipur do hereby solemnly affirm on oath and state as under:
1. That I am the secretary & Authorised Signatory of the Appellant Society in the present Income tax Appeal which stands registered as DBITA 219/2017 and therefore well conversant with the facts and circumstances of the present case and competent to swear this affidavit.
2. That it is submitted that during the course of admission of the present Income-tax Appeal the Hon'ble Court was of the opinion that clause No. 5 [PB 35] in the objects of the Appellant Society which reads as under runs contrary to charitable objects of a society:
(v) tSu lekt o /keZ dks vk?kkr igqp a kus okys dkuwuksa dk fojks/k djukA
3. That the counsel of the appellant society Shri Siddharth Ranka, Advocate, also immediately apprised me of the situation and requested that a meeting of the society be called and decision be taken with reference to clause No. 5 in the objects of the Appellant Society which even the ld. Commissioner of Income-tax and ld. Income tax Appellate Tribunal did not find favour with and which is leading to wrong impression about the objects of the appellant society.
4. That I had accordingly called for meeting of the office bearers of the appellant Society which was held on 02.08.2017 and it was unanimously decided as under:
(3 of 16) [ITA-219/2017] a. That the members of society who had migrated from Pakistan at the time of partition of India have been running and maintaining a temple in Jaipur City by the name of SHREE MULTAN JAIN SHWETAMBAR SABHA.
b. That earlier the deity which is approximately more than 200 years old was established in a temple situated in Multan city situated in current Pakistan.
c. That a need to formalize the working of the Temple was felt and accordingly a society was registered under the Rajasthan Societies Registration Act, 1958 on 04.11.2011.
d. That for most of the time since the existence of the society it has been running into losses and is dependent upon its members for its upkeep and maintenance, however, it was advised by the Charted Accountant of the Society that in order to safeguard precious little resources it would be prudent to opt for 12AA registration under the provisions of Income tax Act and accordingly an application was filed on 13.04.2016 with the ld.
Commissioner of Income tax.
e. That it is hereby clarified that in 70 years of its existence, till date, the society has never challenged any of the Government or Court order, law, rules or regulations (either directly or indirectly) and it has never participated in any activity which flouts Government or Court order, law, rules or regulations and it has no intention of doing so in the future. f. That, however, it appears that the clause (5) is creating contrary impression that the appellant trust is created with a purpose to oppose Government or Court order, law, rules or regulations.
g. That accordingly it is decided that this clause No. 5 be removed from the object clause of the society with immediate effect.
(4 of 16) [ITA-219/2017] h. The Secretary and/or President are jointly and individually authorized to undertake all steps as is deemed necessary to ensure that the said clause No. 5 is removed at the earliest.
5. That I thus give an undertaking on behalf of the appellant society that the appellant society till date has never acted upon the above-said clause No. 5 as enshrined in its object clause and in coming time shall be taking active steps to ensure that the same is deleted from its objects. Copy of minutes of meeting held on 02.08.2017 is enclosed herewith and marked as Annexure 5.
5. In that view of the matter, we are of the opinion that in view of the judgments which have sought to be relied upon by the counsel for the appellant:
1. CIT vs. Dawoodi Bohara Jamat, [2014] 364 ITR 31 (SC),wherein it has been observed as under:-
"28. The objects of the Respondent-trust are not indicative of a wholly religious purpose but are collectively indicative of both charitable and religious purposes. It is expedient to comprehend the objects of the Respondent-trust with reference to the construction of the expressions "charitable purpose" and "religious purpose."
29. The phrase charitable purpose is expansive and inclusive. The expression "charitable purpose" is defined in the dictionary clause of the Act under Section 2(15) as follows:
"charitable purpose" includes relief of the poor, education, medical relief, preservation of environment (including watersheds, forests and wildlife) and preservation of monuments or places or objects of artistic or historic interest, and the advancement of any other object of general public utility:
Provided that the advancement of any other object of general public utility shall not be a charitable purpose, if it involves the carrying on of any activity in the nature of trade, commerce or business, or any activity of rendering any (5 of 16) [ITA-219/2017] service in relation to any trade, commerce or business, for a cess or fee or any other consideration, irrespective of the nature of use or application, or retention, of the income from such activity:
Provided further that the first proviso shall not apply if the aggregate value of the receipts from the activities referred to therein is twenty-five lakh rupees or less in the previous year;"
36. In certain cases, the activities of the trust may contain elements of both: religious and charitable and thus, both the purposes may be over lapping. More so when the religious activity carried on by a particular section of people would be a charitable activity for or towards other members of the community and also public at large. For example, the practice of optional charity in the form of Khairat or Sadaquah under Mohammadan Law would be covered under both charitable as well as religious purpose. Further, while providing food and fodder to animals especially cow is religious activity for Hindus, it would be charitable in respect to non-Hindus as well. Similarly, service of water to the thirsty would find mention as religious activity in sacred texts and at the same time would qualify as a charitable activity.
41. Therefore, the objects of the trust exhibit the dual tenor of religious and charitable purposes and activities. Section 11 of the Act shelters such trust with composite objects to claim exemption from tax as a religious and charitable trust subject to provisions of Section
13. The activities of the trust under such objects would therefore be entitled to exemption accordingly.
45. From the phraseology in clause (b) of Section 13(1), it could be inferred that the Legislature intended to include only the trusts established for charitable purposes. That however does not mean that if a trust is a composite one, that is one for both religious and charitable purposes, then it would not be covered by clause (b). What is intended to be excluded from being eligible for exemption under Section 11 is a trust for charitable purpose which is established for the benefit of any particular religious community or caste.
46. Such trusts with composite objects would (6 of 16) [ITA-219/2017] not be expelled out of the purview of Section 13(1)(b) per se. The Section requires it to be established that such charitable purpose is not for the benefit of a particular religious community or caste. That is to say, it needs to be examined whether such religious-charitable activity carried on by the trust only benefits a certain particular religious community or class or serves across the communities and for society at large. (Sole Trustee, Loka Shikshana Trust v. C.I.T.(1975) 101 ITR 234 (SC)). The section of community sought to be benefited must be either sufficiently defined or identifiable by a common quality of a public or impersonal nature."
2. CIT vs. Bayath Kutchhi Dasha Oswal Jain Mahajan Trust, (2016) 74 Taxman.com 199 (Gujarat), ,wherein it has been observed as under:-
"8. Thus, very premise for the Commissioner to come to the conclusion that the objects of the trust were confined for the benefit of a religious community, is incorrect. Thereafter to suggest that the activities were carried out only for such purposes would be entering in the realm of granting exemptions in terms of Section 13 of the Act, which would be the task of the Assessing Officer to be undertaken at the time of assessment on the basis of material that may be brought on record."
3. CIT vs. Leuva Patel Seva Samaj Trust, (2014) 42 Taxman.com 181 (Gujarat), wherein it has been observed as under:-
Section 12AA, read with sections 11 and 13, of the Income-tax Act, 1961-Charitable or religious trust, Registration procedure [Scope of power] Assessee, a public charitable trust, applied for registration under section 12AA- Commissioner rejected said application holding that trust was for benefit of Leuva Patel Community and, therefore, it would be covered under section 13(1)(b)- Tribunal, however, allowed assessee's application-Whether question as to whether trust is created or established for benefit of any particular religious community or caste would be relevant when income of trust is being assessed in terms of section 11- Held, yes - Whether insofar as section 12AA is concerned, Commissioner has to merely decide if trust has fulfilled necessary requirements of registration as provided under section 12A- Held, yes- Whether in view of above, impugned order (7 of 16) [ITA-219/2017] passed by Tribunal was to be upheld- Held, yes [Para-4][In favour of assessee]
4. CIT v. Bigabass Maheshwari Sewa Samiti, (2008) 220 CTR 369 (Rajasthan), wherein it has been observed as under:-
"Reassessment - Validity Notice issued under Section 148 without inquiry into material--AO had issued notice under Section 148 by recording the reason that amount of donation received by assessee trust had been shown in the corpus fund whereas this amount had been received without specific directions, therefore, this amount could not be treated as corpus fund and same having been received before the date of registration under Section 12AA, i.e., before 14-8-1997, was liable to tax. Tribunal set aside the assessment order passed by AO holding that there was no material direct or indirect available with AO which could show that receipt of donation was without any specific direction of corpus fund. Held: Justified. Tribunal had rightly examined the controversy. Tribunal had further found that AO cannot initiate reassessment proceedings, simply to verify the contents of the return, unlike before it was vested in him in making regular assessment. It was found that the time-limit available for issuance of notice and making assessment under Section 143(3) had expired, but then, on that count, he cannot assume the jurisdiction by venturing to make assessment under Section 148. The reasons given by Tribunal were in accordance with law. AO had not inquired into the nature of the receipts, before issuing notice under Section 148, and in the earlier years also, the receipt of donation was held to be received in the corpus fund. Therefore, Tribunal was justified in setting aside the assessment.
It has been found by the Tribunal that one of the conditions necessary for issuance of notice under Section 148, being under statement of income of the assessee, is not fulfilled. It has been held, that in order to bring an item within the purview of Section 147, it is, of utmost importance, that the AO should have reason to believe, based on relevant and cogent material, that such income has escaped assessment. It has been found, that there was no material direct or indirect, available with the AO, which could show that the receipt of donations, amounting to Rs.
(8 of 16) [ITA-219/2017] 30,16,598, was without any specific direction of corpus fund. The assessee has shown the receipts, as having been received in the corpus fund, coupled with the report of the auditor. The AO had not inquired into the nature of the receipts, before issuing notice under Section 148, and in earlier years also, the amount was held to be received in the corpus fund. [Para 11] Tribunal had rightly examined the controversy. Tribunal has further found that AO cannot initiate reassessment proceedings, simply to verify the contents of the return, unlike before it was vested in him in making regular assessment. It was found that the time-limit available for issuance of notice and making assessment under Section 143(3) had expired, but then, on that count, he cannot assume the jurisdiction by venturing to make assessment under Section 148. Even after hearing counsel for the parties at length, the reasons given by the Tribunal were in accordance with law."
5. CIT v. Arulmigu Sri Kamatchi Amman Trust, (2012) 20 taxmann.com 55 (Madras),wherein it has been observed as under:-
"6. From a reading of the above, it is clear that the income derived from the property held under trust wholly for charitable or religious purposes, shall not be included in the total income of the Trust. Therefore, the said provision would be applicable to both the Trusts established with the object of charitable as well as religious purposes. Therefore, Section 12AA of the Act does not make any difference between the Trusts created with the object of charitable and religious purposes and, even if the Trust is not created with both the objects, law does not make any disqualification for the trust to make an application for registration. Therefore, the Tribunal has correctly applied the provision of law and allowed the appeal, which finding is based on valid material evidence. The finding of the Tribunal is not perverse and it is a question of fact. Therefore, we find no ground to cause our interference into the order passed by the Tribunal. Accordingly, the order passed by the Tribunal is confirmed and both the substantial questions of law raised herein are answered against the Revenue."
6. CIT v. JSB Shikshan Sansthan (DHITA 172/2017 dated 07.11.2017 - Rajasthan High (9 of 16) [ITA-219/2017] Court, wherein it has been observed as under:-
"5. We have heard both the sides contentions raised by Mr. Jain regarding, sub-section (4) of Section 12AA will come into operation after the registration is carried out in consonance with the provisions of object of the trust not at the time of registration."
7. CIT v. Shri Digamber Jain mandir Godhaji (DBITA 21/2017 dated 14.02.2017 - Rajasthan High Court), wherein it has been observed as under:-
"4. We are in complete agreement with the view taken by the Tribunal. Though Mr. Jain has tried to justify the order of the Assessing Officer and CIT(A), but in our view, in view of the binding decision of the Supreme Court in the case of CIT Vs. Dawoodi Bohara (2014) 43 Taxmann.com 242, the Tribunal has not committed any error in allowing the appeal of the assessee."
8. CIT v. Bhagwan Mahaveer Pursharth Prerna Nidhi Nyas (DBITA 163/2012) dated 11.09.2017
- Rajasthan High Court, wherein it has been observed as under:-
"2. This Court while admitting the matter framed the following substantial question of law:-
"Whether in the facts and circumstances of the case the ITAT was justified in law in directing to grant registration to the respondent assessee u/s 12AA despite of the facts that there was violation of section 13(1)(b) of the Act.?"
7. Taking into consideration the above factual position and the law, the issue is required to be answered in favour of the assessee against the department."
9. CIT v. Indin Society of the Church of Jesus Christ of Latter Day Saints (2007) 86 Taxmann.com 44 (Delhi),wherein it has been observed as under:-
"16. The CIT (A) had proceeded on the basis that although the Assessee Society was for both religious and charitable purposes, since it was for the benefit of only one religious community the provision of Section 13(1)(b) would apply to deny it exemption under Section 11 of the Act. The above conclusion was legally flawed. It was (10 of 16) [ITA-219/2017] contrary to the decision of the Supreme Court in Dawoodi Bohra Jamat (supra) which held that even where the trust or society has both religious and charitable objects, "it needs to be examined whether such religious-charitable activity carried on by the trust only benefits a certain particular religious community or class or serves across the communities and for society at large". In that case it was factually found that "the activities of the trust though both charitable and religious are not exclusively meant for a particular religious community" and, therefore Section 13(1)(b) was not attracted. In the present case too, the factual finding of the ITAT is likewise. It has been found that the activities of the Assessee Society, though both religious and charitable, were not exclusively meant for one particular religious community. It was, therefore, rightly not denied exemption under Section 11 of the Act."
10. CIT v. Andhra Chamber of Commerce (1965) 55 ITR 722 (SC),wherein it has been observed as under:-
" The expression 'object of general public utility', however, is not restricted to objects beneficial to the whole of mankind. An object beneficial to a section of the public is an object of general public utility. To serve a charitable purpose, it is not necessary that the object should be to benefit the whole or mankind or even all persons living in a particular country or province. It is sufficient if the intention to benefit a section of the public as distinguished from specified individuals."
11. CIT v. Jodhpur Chartered Accountant Society, (2003) 127 Taxman 90 (Raj.),wherein it has been observed as under:-
" 10. Applying the test laid down by the apex court in Ahmedabad Rana Caste Association v. CIT[1971] 82 ITR 704, we find that the predominant object of the society is dissemination of knowledge and education of commercial laws, tax laws for the benefit of general public to inculcate a sense of responsibility towards the nation and foster law abiding citizens. The objects clause of the constitution emphasises to propagate and disseminate knowledge about the auditing, (11 of 16) [ITA-219/2017] accounting, direct and indirect taxes by holding seminars, conferences and workshops, etc. The fruits of such seminars, conferences, etc., would be available to the public at large, thus, it appears that the society is not for the benefit of a small group of individuals and it is also not only for the benefit of members but to promote awareness and education of the commercial and tax laws for the general public without any profit motive. As observed by the Supreme Court, to serve a charitable purpose it is not necessary that the object should be to benefit the whole of mankind or all persons in a country or State, even if a section of the public is given benefit, it cannot be said that it is not a trust for charitable purpose in the interest of the public. In the situation of explosion in population, the vast changes brought by the scientific technology and other developments, more particularly, the universal concept of glo-balisation, new trends in the world order to meet the ever growing challenges to organising seminars, conferences and workshops to educate the people of commercial laws, tax laws, auditing, accounting, direct and indirect taxes are of great general public utility, at least to a section of people falling in the category of charitable institution. Thus, the Tribunal has rightly directed the Commissioner of Income-tax "to grant registration to the applicant-society under Section 12A of the Income-tax Act, 1961."
12. Hiralal Bhagwati v. CIT [2000] 246 ITR 188 (Guj.),wherein it has been observed as under:-
Even the object beneficial to a section of the public was an objects of 'general public utility'. To serve as a charitable purpose, it is not necessary that the object must be to serve the whole of mankind or all persons living in a country or province. It is required to be noted that even if a section of the public is given benefit, it cannot be said that it is not a trust for charitable purpose in the interest of the public. It is not necessary that the public at large must get the benefit. Hence, a matter is to be decided considering the objects of general public utility. The High Court held that what matters is some common quality of a public or impersonal nature.
The matter is required to be remitted back.
6. However, counsel for the respondent has relied upon (12 of 16) [ITA-219/2017] the decision of Allahabad High Court in case Agarwal Sabha (Regd.) vs. Commissioner of Income Tax, 2014 (365) ITR 244, wherein it has been observed as under:-
"11. In the present case, the Commissioner of Income-tax has held that the dominant nature underlying the setting up of a trust was to benefit only the Agrawal community. The Commissioner of Income-tax relied upon such material as was produced by the assessee. If, according to the assessee, the trust exists not merely for the benefit of the general public for a charitable or religious purpose, it would be necessary for the assessee to satisfy the Commissioner about the activities of the trust or the genuineness of its objects. Such a requirement is expressly incorporated in clauses
(a) and (b) of sub-section (1) of section 12AA.
12. The assessee having failed to discharge the burden, the Tribunal, in our view, was justified in confirming the decision of the Commissioner. At the same time, it has been left open to the assessee to move a fresh application for registration before the Commissioner. We need only to clarify that if this is done, it shall be duly considered in accordance with law on the basis of the materials that will be produced by the assessee.
14. In the circumstances, on the basis of the material which was produced by the assessee on the record of the Commissioner and before the Tribunal, we are of the view that no substantial question of law would arise in this appeal so as to warrant the interference of this court. However, while dismissing the appeal, we clarify that this would not affect the liberty which has been granted to the society to file a fresh application for registration."
7. On the second issue regarding object for a particular community, counsel for the appellant has relied on the following decisions:
1. C.P. Vidya Niketan Inter College Shikshan Society v. Union of India, [2013] 40 taxmann.com 76 (Allahabad), wherein it has been observed as under:-
(13 of 16) [ITA-219/2017] "24. In the facts and circumstances, we are of the opinion that as of now the petitioner society running educational institution by the name of C.P. Vidya Niketan Inter College at Kaimganj, Distt. Farrukhabad imparts education to students from Class VI to XII, in the absence of any allegation or material, the object clause providing for other charitable activities, would not disentitle the society from approval under Section 10(23C)(vi) of exemption. The proviso added to Section 10(23C)(vi), specially Proviso 2, 3, 12 and 13, give sufficient powers to check the abuse of the exemption. The mere possibility, therefore, that the society may in future pursue activities, which are not charitable, or closely connected with education for making profit, would not constitute the grounds to reject the approval under Section 10(23C)(vi).
25. On the question of satisfaction of the Prescribed Authority of the conditions of the Second Proviso to Section 10(23C)(vi), we are of the view that the Chief Commissioner of Income Tax did not give sufficient opportunity to the petitioner, to place documents relevant to the enquiry before rejecting the application. The contents of paragraph 9 of the writ petition that the hearing proceeded on the same day on 27.5.2011, when the petitioner was required to produce the audit report under Rule 16CC in Form 10BB, and the petitioner was granted time to furnish the same within three days, has not been specifically denied in the counter affidavit.
The reply is rather argumentative. We also find that there was no hurry to close the enquiry in as much as the rejection of the application will visit serious consequence on the petitioner in as much as having exceeded the aggregate receipts over and above Rupees One crore, the income of the society in the absence of the exemption under Section 10(23C)(vi) would not qualify for exemption.
26. In the rejoinder affidavit it is stated in paragraph 8 that audit report was submitted in Form 3CB prior to the hearing on 27.5.2011. The (14 of 16) [ITA-219/2017] petitioner-society was never informed that audit report in Form 10BB, was required to be submitted by it, and as such the petitioner could not submit audit report in Form 10BB. The request for time to produce From 10BB was allowed on 27.5.2011 orally, but that before the time allowed could expire the order was passed. The enquiry under Second Proviso to Section 10(23), was not complete and thus the opinion of the Chief Commissioner of Income Tax, Ghaziabad as Prescribed Authority was not formed on the examination of the relevant records, which he had directed to be produced.
27. In the facts and circumstances of the case, we allow the writ petition and while setting aside the order dated 27.5.2011 passed by the Chief Commissioner of Income Tax, Ghaziabad, direct him to decide the application again confined to the enquiry on the Second Proviso to Section 10(23C) of the Act to satisfy himself of the conditions of grant of approval. A fresh notice will be given to the petitioner to submit the requisite documents on which a fresh order will be passed by the Chief Commissioner, Income Tax, Ghaziabad."
2. Sri Venkateshwar Educational Society (Regd.) v. Director General of Income Tax (exemptions), [2011] 9 taxmann.com 196 (Delhi), wherein it has been observed as under:-
9. Insofar as apprehension of the respondent that in view of other objectives mentioned in the Memorandum of Association, the petitioner may undertake those activities and channelize the funds generated from the aforesaid school to those activities, it is significant to point out that petitioner had filed affidavit with the respondent specifically undertaking as under:
"It is customary and general practice to make the objects broad and wide at the time of drafting of objects of the society. The inclusion of the above objects is as a result of the same. However, it is pertinent to note that the society was never engaged in the past in any of the activity stated in the above objectives. The audited accounts are available on record to verify this fact.
(15 of 16) [ITA-219/2017] We further assure and undertake that we shall not carry out any of the above mentioned activity in future. We are attaching herewith Affidavit to that effect from the President of the Society."
10. Learned counsel for the petitioner states that petitioner-society shall continue to abide by the undertaking.
11. The apprehensions of the respondent are thus taken care of by giving of the aforersaid undertaking. Further, in case such an undertaking is violated, the remedial action can always be taken by the respondent by withdrawing the exemption so granted. All these aspects are discussed in detail by the Supreme Court in American Hotel & Lodging Association Educational Institute v. CBDT [2008] 301 ITR 861 and by this Court inDigember Jain Society for Child Welfare v. Director General of Income- tax (Exemptions) [2009] 183 Taxman 462 (Delhi), following the aforesaid judgment of the Supreme Court. In view of the aforesaid, we allow this writ petition. Impugned order passed by the Director is set aside and mandamus is issued to the respondent to grant exemption to the petitioner under section 10(23C)(vi) of the Income-tax Act for the year 2007-08 onwards.
3. Digember Jain Society for Child Welfare vs. Director General of Income Tax (Exemptions), [2009] 185 TAXMAN 255 (Delhi), wherein it has been observed as under:-
"17. In these circumstances, we make the rule absolute and allow this writ petition by quashing the impugned order dated 28.4.2008 and issue a writ of mandamus directing the respondent to give exemption to the petitioner society under Section 10(23C)(vi) of the Act. However while doing so, the respondent shall be free to incorporate stipulations and conditions in terms of third proviso. It will also be subject to an affidavit of undertaking given by the petitioner society that it would not breach any of those conditions and further that surplus funds shall be utilized only for educational purposes and will not be diverted to other non-educational objectives.
No cost."
4. Neo Gurishi Educational Society (Registered) v. Director of Income Tax, [2010] 2 DTLONLINE 119 (DELHI), wherein it (16 of 16) [ITA-219/2017] has been observed as under:-
3. A perusal of the said order would show that the petitioner society had filed an affidavit dated 25th April, 2009 inter alia stating that the society is doing solely the educational activity till date and will not undertake any other activity in future as well. Undertaking is also given to the fact that Clauses B, D and E of the memorandum of association would be deleted/amended within a period of six months.
8. In our considered opinion, we remit matter back to the authority to consider the law on subject and will reconsider independently, in view of observation made by us, will independently consider the law declared by the Supreme Court and also while remitting matter back, we restrained from passing order of registration, keeping the power of authority intact their independent power to grant registration. We are remitting back the matter to the authority.
9. The issue is answered in favour of assessee and against the department.
10. The appeal stands allowed.
(VIJAY KUMAR VYAS), J. (K.S. JHAVERI), J.
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