Itta/142/2015 Of Vardhaman College Of Engineering v. Dy.director Of Income Tax [Exemptions] - I

HON'BLE SRI JUSTICE RAMESH RANGANATHAN AND HON'BLE SRI JUSTICE M. SATYANARAYANA MURTHY INCOME TAX TRIBUNAL APPEAL No.142 OF 2015 JUDGMENT:(Per Hon’ble Sri Justice Ramesh Ranganathan) This Appeal, under Section 260-A of the Income Tax Act, 1961 (for short ‘theAct’), is preferred against the order passed by the Income Tax Appellate Tribunal,Hyderabad Bench (for short, ‘the Tribunal’) in I.T.A. No.741/Hyd/2009 dated08.04.2011 for the assessment year 2005-06. The assessee is an educational institution. On the ground that it did notobtain a notification under Section 10(23-C)(vi) of the Act, the assessing authorityrefused to extend them the benefit of Section 11 of the Act. In Appeal, theCommissioner of Income-Tax (Appeals) held in favour of the assessee, and opinedthat, as long as the appellant had the benefit of registration under Section 12-A ofthe Act, they could not be denied the benefit of exemption under Section 11 of theAct. Aggrieved thereby, the Revenue carried the matter in Appeal to the Tribunal. In the order under Appeal, the Tribunal agreed with the assessee that aneducational institution is entitled for exemption either under Section 10(23-C) orunder Section 11 of the Act. It, however, held that such an exemption would beavailable only if donation is not collected from the students. The assessing authoritywas directed by the Tribunal to verify the aspect of donation, capitation fee etc., ifany, collected by the assessee; and, if it were found that besides fulfilling otherprerequisites for exemption under Section 11, the assessee had not charged anymoney, by whatever name it is called i.e., donation, building fund, auditorium fee etc., over and above the prescribed fee for the admission of students, they would beentitled for exemption under Section 11, even though the notification under Section10(23-C)(vi) of the Act had not been received by them. The assessee has preferredan Appeal, aggrieved by the order of the Tribunal, to the limited extent that theassessing officer was directed to verify the aspect of donation, capitation fee etc., ifany, collected by the assessee. Sri K. Vasant Kumar, learned counsel for the appellant, would draw attentionof this Court to Circular No.14 of 2015, dated 17.08.2015 in support of hissubmission that the Tribunal lacks jurisdiction to issue any such directions to theassessing authority more so, when it is agreed with the order of the Commissioner ofIncome-Tax (Appeals) that the assessee is entitled for the benefit of exemptionunder Section 11 provided it is registered under Section 12-A of the Act. We see no reason, however, to examine this question as Sri K. VasantKumar, learned counsel for the appellant, would fairly state that, in compliance withthe order of the Tribunal, the assessing authority had examined the matter afresh,and had passed an order in favour of the assessee which has attained finality. Asthe question raised in this Appeal, in view of the subsequent events, has becomeacademic it would suffice to make it clear that this question, regarding the power ofthe Tribunal to issue directions to the assessing authority, is left open to beexamined in an appropriate case. Subject to the above observations, the Appeals fails and is, accordingly,dismissed. In consequence, miscellaneous petitions, if any, pending in this Appeal shall standdismissed. There shall be no order as to costs. _____________________________ _____________________________ M. SATYANARAYANA MURTHY, J Date: 03-12-2015. Dsh HON'BLE SRI JUSTICE RAMESH RANGANATHAN AND HON'BLE SRI JUSTICE M. SATYANARAYANA MURTHY 04122015 DSH INCOME TAX TRIBUNAL APPEAL No.142 OF 2015 (Judgment of the Division Bench delivered by Hon’ble Sri Justice Ramesh Ranganathan) Date. 03-12-2015