ITXA1061_17.doc IN HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL (IT) NO.1061 OF 2017 WITH INCOME TAX APPEAL (IT) NO.1062 OF 2017 WITH INCOME TAX APPEAL (IT) NO.2017 OF 2017 WITH INCOME TAX APPEAL (IT) NO.283 OF 2018 WITH INCOME TAX APPEAL (IT) NO.384 OF 2018 WITH INCOME TAX APPEAL (IT) NO.526 OF 2018 WITH INCOME TAX APPEAL (IT) NO.762 OF 2018 Pr. Commissioner of Income Tax - (central), Pune Appellant Vs. Shikshan Prasarak Mandali Respondent Mr. Sham V. Walve for Appellant. Mr. Mandar Vaidya for Respondent. CORAM : UJJAL BHUYAN & MILIND N. JADHAV, JJ. DATE : JANUARY 20, 2020 P.C. : Heard learned counsel for parties. 2. This appeal has been preferred by Revenue under Section 260- of Income Tax Act, 1961 (briefly Act hereinafter) assailing order dated 19.10.2016 passed by Income Tax Appellate Tribunal, Pune Bench , Pune (briefly Tribunal hereinafter) in Income Tax Appeal Nos.1127 to 1133/PN/2011 filed by assessee (respondent) Shikshan Prasarak Mandali pertaining to assessment years 1/4 ::: Uploaded on - 27/01/2020 ::: Downloaded on - 01/02/2020 10:20:51 ::: ITXA1061_17.doc 2003-04 to 2009-10. 3. core issue involved in appeal is whether amount collected by assessee as donation from students was within permissible limit of 15% or whether same was done with profit motive to suggest that assessee is running related educational institute on commercial line. following questions have been formulated by Revenue while assailing finding of Tribunal: 1. Whether on facts and circumstances of case and in law, Tribunal was right in holding that Assessing Officer had incorrectly given retrospective effect to order passed u/s. 12AA(3) of Income Tax Act, 1961 by Commissioner of Income Tax, Pune (Commissioner) when in fact impugned assessment orders were passed subsequent to order of Commissioner u/s.12AA(3) of Act? assessee was not having exemption u/s.12A at time of passing of assessment order. 2. Whether on facts and circumstances of case and in law, Tribunal was right in deleting addition made on account of acceptance of capitation fees by assessee and is perverse as it had not taken into account evidence collected by Department during search operation in totality? 3. Whether Tribunal has erred in holding that assessee through its various institutes was assessable to pay tax by way of voluntary donations which are not specific donations for corpus of assessee which was mandatory requirement for donation to be treated as corpus donation ? 4. Whether Tribunal has erred in law in failing to appreciate that any fees charged over and above prescribed fee amounts to selling of education and element of charity no longer remains in activities of assessee? 5. Whether Tribunal has erred in holding that assessee trust satisfies conditions laid down u/s.10(23C) (iiiab) inspite of specific findings given in assessment order that it had engaged in collecting fees over and above guidelines set by University? 6. Whether Tribunal has erred in holding that assessee Trust satisfies conditions of Section 10(23C)(iiiab) inspite of specific findings given in assessment order that it had engaged in collecting fees over and above guidelines set by University and is illegal in terms of Maharashtra Educational Institution (Prohibition of Capitation Fees) Act, 2/4 ::: Uploaded on - 27/01/2020 ::: Downloaded on - 01/02/2020 10:20:51 ::: ITXA1061_17.doc 1987? 7. Whether Tribunal has erred in not appreciating that provisions of Section 11(5) read with Section 13(1)(d) have been brought into to prevent misuse of funds of Trust in view of numerous incentive granted to trust and if trust invests or deposits otherwise than in any one or more of forms or modes specified in sub-sect.5 of Sec.11 then it amounts to clear violation of said provisions and thus would lose exemption u/s.11 and 12? 4. In course of hearing, order dated 11.09.2017 passed by Division Bench of this Court in Income Tax Appeal No.59 of 2015 pertaining to same assessee for assessment years 2010-11 and 2011-12 and involving same issue has been placed before us. This Court, on going through order of Tribunal and reasons and justifications given, did not find any good reason to interfere with same. Relevant portion of order dated 11.09.2017 is extracted hereunder:- 9. Tribunal found that assessee - trust is more than 100 years old. It runs more than 60 educational institutions imparting education to more than 70000 students in various fields. It was granted registration earlier under Section 12A. Commissioner of Income Tax, however, relied on certain amounts styled as 'donations collected from students'. He held that this was against assurance to admit them to these educational courses. Collection of such donations or moneys, therefore, attracts provisions under Capitation Fee Act. Tribunal found that there is no merit in this finding of Commissioner. assessee pointed out that as against 70 management quota seats in educational institutions, assessee collected donation from nine students. sum of donation is within prescribed limit and Government of Maharashtra has not at all prohibited receipt of same. In paragraphs 8.3 and 8.4 of order of Tribunal, details of such students and donations collected from them have been referred. Then, other objection of Commissioner was that assessee is accumulating huge surplus year after year. However, Tribunal found that this surplus is within permissible limit of 15% and how that is worked out is apparent from paragraph 8.5 of Tribunal's order. Thus, Tribunal found that accumulation of surplus is within permissible limit. It cannot be said that assessee is running educational institution on commercial lines. 3/4 ::: Uploaded on - 27/01/2020 ::: Downloaded on - 01/02/2020 10:20:51 ::: ITXA1061_17.doc 5. On thorough consideration of matter, we are of considered opinion that above decision would be squarely applicable to facts of present case. Tribunal had assigned cogent and satisfactory reasons while deleting addition made by Assessing Officer. There is no error or infirmity in impugned order of Tribunal. No substantial question of law arises in these appeals. 6. Consequently, all appeals are dismissed. However, there shall be no order as to costs. (MILIND N. JADHAV, J.) (UJJAL BHUYAN, J.) Minal Parab 4/4 ::: Uploaded on - 27/01/2020 ::: Downloaded on - 01/02/2020 10:20:51 ::: Pr. Commissioner of Income-tax - (Central), Pune v. Shikshan Prasarak Mandali