LITTLE ANGELS SHIKSHA SAMITI Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners have filed this petition against the order Annexure-P/1, dated 18-2-2008, by which the application of the petitioners filed under section 10(23C)(vi) of the Income Tax Act, 1961 has been rejected.

(2.) The petitioner-society is a society registered with the Registrar of Firms and Societies under the M.P. Society Registration Act, 1973. It has been running a school named as Little Angels High School at Gudi Guda Ka Naka, Gwalior. As per the society, its sole activity is running a school named as Little Angels High School. The school has been providing education to the children upto 12th standard. The educational institutions were granted exemption under section 10(22) of the Income Tax Act, 1961 (hereinafter referred to as the 'Act of 1961'). On 1-4-1999, section 10(22) of the Act of 1961 was omitted and it was replaced by section 10(23C) which contains exemption provisions for educational institutions were not required to file return of the income upto the assessment year 2002-2003. With effect from 1-4-2003, it was made mandatory to file return for educational institutions where aggregate annual receipts exceeds Rs. 1 crore in accordance with section 139 (4C) of the Act of 1961. As per the society it had been filing returns voluntarily and in the year 2004-2005 and 2005-2006, the annual receipts of the petitioners-society were exceeded of Rs. 1 Crore, hence, the application for exemption was filed and the exemption was granted.

(3.) The petitioner No. 1 filed an application seeking exemption under section 10(23C)(vi) of the Act of 1961 for the assessment year of 2007-2008 accounting period 1-4-2006 to 31-3-2007. The Chief Commissioner of Income Tax vide letter dated 7-2-2008 sought certain clarifications from the petitioner No. 1-society in regard to exemption. It has been mentioned in the letter that two objects of the society, namely, appear to be non-educational and they are independent to other objects of the society, hence, the petitioner-society was directed to explain its claim to the effect that the society exists solely for educational purposes. The petitioner-society submitted its reply on 12-2-2008, which has been filed as Annexure-P/7 along with the petition, and mentioned that the society was not engaged in any business activity except providing education to the children and it had not advanced any loan or advance to the members of office bearers of the society during the year 2007-2008. It has further been stated that on 26-3-2007 the object clause of the society had been amended by deleting sub-clause 3 (c) and 3 (d). Thereafter vide impugned order Annexure-P/1, dated 18-2-2008, the application of the petitioners-society has been rejected.