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| The Tax Publishers2020 TaxPub(DT) 0367 (Mum-Trib) : (2020) 203 TTJ 0590 INCOME TAX ACT, 1961
Section 11
Where contention of assessee that it was engaged in activity of providing education, the proviso to section 2(15) was not applicable and the said aspect was not examined or dealt with by Tribunal because no pleading to that effect was taken by the assessee, therefore, matter was remanded back to AO for re-examination and directed him to adjudicate the issue keeping in view the evidences filed by assessee.
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Charitable trust - Exemption under section 11 - Disallowance of claim of exemption under section 11 in respect of consultancy fee received -
Assessee was basically undertaking research in the field of chemical engineering and providing training and claimed exemption under section 11. AO noticed that during the year, assessee received consultancy fee. Assessee submitted that certain projects were undertaken with a view to carry out research and help the students/fellows of Institution to gain actual working experience in live projects in subject during the course of their studies. It was submitted, out of the total fee received from such projects, only 1/3rd is taken by assessee and balance amount was paid to faculty who undertakes the research project. AO, however, concluded that revenue earned on such consultancy activity could not be regarded as charitable in view of provisions of section 2(15) read with sections 11 and 12 and disallowed assessee's claim of exemption only with regard to its share in consultancy fee received, though, he allowed assessee's claim of exemption under section 11. Held: The proviso to section 2(15) applies only to activity of 'advancement of any other object of general public utility' as per definition of charitable purpose under section 2(15). It was the contention of assessee that since it was engaged in the activity of providing education, the proviso to section 2(15) was not applicable. The aforesaid aspect was not examined or dealt with by Tribunal because no pleading to that effect was taken by assessee. Since claim of assessee had not at all been examined by Departmental Authorities, therefore, matter was remanded back to AO for re-examination and directed him to adjudicate the issue keeping in view the evidences filed by assessee.
REFERRED : DIT(E) v. Lala Lajpatrai Memorial Trust (2016) 383 ITR 345 (Bom.) : 2016 TaxPub(DT) 1896 (Bom-HC) and Asstt. CIT(E) v. Institute of Chemical Technology University of Mumbai [ITA No. 3808/Mum/2015, dt. 28-10-2015] : 2015 TaxPub(DT) 5074 (Mum-Trib).
FAVOUR : In assessee's favour by way of remanded.
A.Y. :
IN THE ITAT, MUMBAI BENCH
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