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1 - 10 of 15 (0.49 seconds)Section 11 in The Societies Registration Act, 1860 [Entire Act]
Birla Vidhya Vihar Trust vs Commissioner Of Income-Tax, Central I on 4 May, 1981
44. The question arises whether exemption under s. 10(22) of the Act can be denied to the income from school, which was solely for educational purposes, because the assessee-society had some non-educational purposes also. The only direct decision on this aspect placed before us is the decision of the Calcutta High Court in Birla Vidhya Vihar Trust vs. CIT (supra). It was held therein that the trust which owned the educational institution may have other charitable though not educational purposes but if taking all the relevant factors the educational institution generating the income was existing for only educational purposes, then the assessee was entitled to exemption under s. 10(22) of the Act. The material facts are similar in this case. We also note that the assessee-society had no other activity apart from running the school. We would respectfully follow the above decision.
Sole Trustee Loka Shikshana Turst vs Commissioner Of Income Tax, Mysore on 28 August, 1975
48. The CIT(A) has relied upon the decision of the Supreme Court in the case of Sole Trustee Loka Shikshana Trust vs. CIT (supra) in coming to the conclusion that the objects of the society are not educational and, therefore, it does not exist solely for educational purposes. It is an admitted fact that some of the objects of the society were not for educational purposes. We have already noted this. However, the activity of running Maharishi Vidya Mandir (Public School) under a separate managing committee, authorised, inter alia by cl. (vii) of the objects, was undoubtedly solely for educational purposes. We have drawn out this distinction earlier also. This distinction was not kept in view by the CIT(A) either.
The Societies Registration Act, 1860
Additional Commissioner Of Income-Tax vs Aditanar Educational Institution on 23 February, 1979
CIT vs. Aditanar Educational Institution (supra) that income of a society running a college would not be exempt under s. 10(22) of the Act. Only the income which "has a direct relation or is incidental to the running of the institution as such, would qualify for exemption." Thus, the test to be applied is whether the income from running of buses and interest income fulfil the above conditions. As far as running of buses is concerned, there is no material to show that they were being used for outsiders. In fact, there is no such allegation in the assessment orders either. The CIT(A) has taken this objection without going into the matter in the asst. yr. 1993-94. We are satisfied on the basis of material before us and the submissions that the buses were only school buses and the receipts from the buses were fees from the school children. We, therefore, held that the above test is satisfied. Regarding interest income we have noticed from the balance sheets that the surplus was being utilised in a substantial manner for increase in fixed assets of the school. The school's own building construction started in asst. yr. 1993-94, the expenditure in that year being about Rs. 3.47 lacs. Considering that lease rent for the hired building was Rs. 3 lacs per year, it is evident that a fairly large sum would be required for the school building and would have to be built up gradually from yearly surplus. Thus, putting of some surplus money in fixed deposit for the interim period would also constitute an incidental activity to the school and interest income would also be incidental to running of the school. It also fulfils the conditions. Respectfully following the above decision, we hold that both these incomes would be treated at part with income from educational purposes for the purpose of s. 10(22) of the Act. Similar is the position with regard to petty donation of Rs. 7,000 which was evidently for school activities and has been utilised as such. We, therefore, hold similarly for this income also.
Section 12 in The Societies Registration Act, 1860 [Entire Act]
Governing Body Of Rangaraya Medical ... vs Income-Tax Officer, A-Ward on 8 December, 1975
Rao Bahadur A.K.D. Dharmaraja ... vs Commissioner Of Income-Tax on 5 October, 1989
46. The AO has also referred to the decision in Rao Bahadur A. K. D. Dharmaraja Education Charitable Trust vs. CIT (supra). In that case, the assessee was a public charitable trust and was receiving income from running theatre, leasing, etc. Only a small portion of the income was spent for educational purposes and part of the income was spent on religious purposes. On the facts of the case, it was noticed that factually only a very small amount had been spent for educational purposes leaving a huge surplus for other charitable purposes. It was held that it could not be said that the institution was solely for educational purposes and, thus, entitled to exemption under s. 10(22) of the Act. However, the facts in the present case are distinguishable. The assessee-society did not carry out any of the non-educational purposes. The only activity was solely for educational purposes. No amount was spent for religious or non-educational purpose. The surplus has been shown to have been utilised for expansion of school activity. We have noticed that the surplus went towards procurement of fixed assets for the school and building construction was also started. The remaining surplus was kept available in bank and not diverted as loans and advances. The ratio of the case relied upon cannot be applied to the materially different facts of the present case.
Commr. Of Income-Tax, U.P., Lucknow vs Radhaswami Satsang Sabha on 28 September, 1953
It was next stated that the decision in the case of CIT vs. Radhaswami Satsang Sabha (supra) was not applicable since the facts were distinguishable.