Commissioner Of Income Tax (Exemptions), Kolkata v. M/S. Salt Lake Shiksha Sadan

OD-20 IN THE HIGH COURT AT CALCUTTASpecial Jurisdiction (Income Tax)ORIGINAL SIDE ITAT/53/2024 IA NO: GA/2/2024 COMMISSIONER OF INCOME TAX (EXEMPTIONS), KOLKATAVsM/S. SALT LAKE SHIKSHA SADAN BEFORE: THE HON’BLE THE CHIEF JUSTICE T.S. SIVAGNANAMAnd THE HON’BLE JUSTICE HIRANMAY BHATTACHARYYA Date : 3[rd] May, 2024. Appearance:Mr. Smita Das De, Adv.…for the appellant Mr. Sourav Bagaria, Adv.Mr. Sourav Chunder, Adv.Ms. Mandobi Chowdhury, Adv.…for the respondent The Court: This appeal filed by the Revenue under Section 260A of theIncome Tax Act, 1961 (the Act) against an order dated 12[th] June, 2023 passedby the Income Tax Appellate Tribunal, “B” Bench, Kolkata in I.T.A.No.209/Kol/2021 for the Assessment Year 2016-17. The Revenue has raised the following substantial questions of law forconsideration:- (a)Whether on the facts and in the circumstances of the case the Tribunalwas justified in law to hold the receipts received from the students onaccount of Admission Fee, Academic Improvement Fund and Development Fund as Corpus Donation under Section 11(1)(d) of thesaid Act ignoring the fact that the said receipts are collectedcompulsorily from students along with tuition fees without any specificdirection to qualify to be a corpus donation. (d)Whether on the facts and in the circumstances of the case the Tribunalwas justified in law to treat the amount collected from the students inthe nature of corpus donation as capital receipts despite the fact thatthe receipts are revenue in nature since there is no iota of evidence toshow that the students are paying the fees voluntarily and not dictatedfrom the institute?was justified in law to treat the amount collected from the students inthe nature of corpus donation as capital receipts despite the fact thatthe receipts are revenue in nature since there is no iota of evidence toshow that the students are paying the fees voluntarily and not dictatedfrom the institute? We have heard Ms. Smita Das De, learned counsel for the appellant andMr. Sourav Bagaria, learned counsel appearing for the respondent. The instant case arose out of the proceeding initiated under Section 263of the Act by the Principal Commissioner of Income Tax (PCIT). The assesseewhich is a society engaged in educational activities is a charitable institutionand holds a registration under Section 12A of the Act. They have claimeddeduction under Section 11 which was accepted by the Assessing Officer.However, the PCIT was of the view that the funds which were collected cannotbe shown to be for development fund for the institution. Aggrieved by such order passed by the PCIT, the assessee filed appealbefore the Tribunal. The Tribunal apart from noting the decisions which wererelied on by the parties, took note of the documents which were placed before the Tribunal in the form of a paper book and found that the funds collected bythe assessee have been used for development purpose i.e., for purchase anddevelopment of land and the extension and renovation of the existing school atSalt Lake. Further, the Tribunal noted that the State Government has granted100% remission of stamp duty and registration charges in respect of atransaction where the assessee purchased the land. Furthermore, on facts, theTribunal found that the receipts by the assessee have been routed throughcorpus fund of the assessee and have been used for the development purposei.e., for the purchase of land and extension of school building. Thus, considering the facts of the case, the learned Tribunal concludedthat the funds otherwise have been deployed for development purpose areotherwise a debatable issue on which jurisdiction under Section 263 of the Actcould not have been invoked. Thus, we find no question of law much lesssubstantial question of law arising for consideration in this appeal.Accordingly, the appeal fails and is dismissed. Consequently, the application stands closed. (T.S. SIVAGNANAM, CJ.) (HIRANMAY BHATTACHARYYA, J.) bp/R.Bhar