Case Law Details
Dy. CIT (E) Vs. Vignana Jyothi (ITAT Hyderabad)
Tribunal has clearly held that there is no violation of the provisions of the A.P. Educational Institutions (Regulation of Admission and Prohibition of Capitation Fees Act of 1983). It is also mentioned that the assessee has received the donations by way of DDs/Cheques which are duly accounted for in its books of account and has also been applied for the purpose of education only. Having held that the activities of the assessee trust are charitable in nature and the donations are permitted by the memorandum and there is no complaint that the assessee was collecting any fees more than what was prescribed, it cannot be said that the assessee has violated any of the conditions for claiming exemption under section 11 of the Act. We also find that the Coordinate Bench of this Tribunal in the case of Voditala Educational Society v. ADIT (cited supra) was considering the case of an assessee where there is a finding that the assessee therein was collecting money over and above the prescribed fee from students and in such circumstances, it was held that it was to be classified as capitation fee and therefore, not eligible for exemption under section 11 of the Act. In the case before us, it is seen that the assessee has received donations from various persons and more than 50% of the donations are from people who are not at all concerned with the admission of the students whereas the assessing officer has disallowed the entire donations. It is also seen that all the donations are recorded in the books of account of the assessee and most of the parents and relatives of the students also have stated that the donations are voluntary. Only a few parents of the students have stated that the donations are connected with the admissions and some of these statements have also been retracted subsequently. There is also no finding that the assessee has misused or not used the donations for any other purpose than the purpose for which they have been given i.e., for educational purpose. In such circumstances, we are of the opinion that the exemption under section 11 of the Act cannot be denied in toto to the assessee with regard to the voluntary donations received by the assessee. Only such donations, which are admittedly not voluntary can be disallowed.
Full Text of the ITAT Order is as follows:-
All the above are cross appeals of the assessee as well as the Revenue for the assessment years 2010-11 and 2011-12 respectively against separate orders of the Commissioner (Appeals)-IV Hyderabad dated 12-9-2014.
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