MAA SARASWATI EDUCATIONAL TRUST Vs. UNION OF INDIA

JUDGEMENT

(1.) The guiding principles under Section 10(23-C)(vi) of the Income Tax Act, 1961 governing the approval of educational institution prescribed by the authority, namely, Chief Commissioner of Income Tax, fall for consideration in this case. The petitioner is a registered Trust. The object of the Trust, for which it is established, reads as follows:

(2.) A perusal of the objects, as above, and it is not in dispute also that the same is established only for educational purposes. Under Section 10(23-C)(vi) of the Income Tax Act, any income of such educational institution satisfying the parameters of the provisions is liable to be exempted. The department has declined to approve the petitioner under Section 10(23-C)(vi) of the Income Tax Act and hence the writ petition.

(3.) A perusal of the impugned order would show that the Commissioner was not satisfied as to the explanation for accumulation of income by the petitioner/institution and also some of the financial transactions. It is stated in the order that the Trust had accumulated huge income during the financial years 2003-2004 to 2006-2007 and according to the Commissioner, the institution has been generating profit.