REGIONAL COMPUTER CENTRE Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) AT the instance of the applicant -assessee Regional Computer Centre, Chandigarh (for brevity, 'the assessee RCC'), the instant reference has been made under s. 256(1) of the IT Act, 1961 (for brevity, 'the Act'), by the Income -tax Appellant Tribunal, Chandigarh Bench, Chandigarh (for brevity, 'the Tribunal'). The Tribunal has referred the following questions of of the asst. yr. 1984 -85 :

(2.) FACTS in brief may first be noticed. The assessee RCC is a Society registered under the Society Registration Act, 1860. the claim of exemption under ss. 11 and 10(22) of the Act. However, the AO rejected the claim of the assessee RCC for taxable income of the assessee RCC has been assessed at Rs. 19,64,024.

(3.) THE assessee RCC went in appeal before the CIT(A), who examined the provisions of s. 11(4A) r/w 10(22) of the Act under s. 11 of the Act because it was carrying on the activity of a computer centre by providing consultancy, taking of projects and imparting training programme with the object of promoting computer science. Accordingly, it has been charging fee for that purpose. The CIT(A) further held that the benefit of s. 10(22) of the Act is also not available to the assessee RCC, inasmuch as, consultancy was a major activity of the assessee RCC and training programme represented only a small portion of its activities. It was still further held that the computer centre run by the assessee RCC could not be termed as an educational institution.