Furnishing return of income is not mandatory for claiming exemption u/s 10(23C)(iiiad) if gross receipts less than 1 crore

Brief of the case:

The ITAT Chandigarh in the case of Mahabir Educational Welfare Society vs. DCIT held that for claiming exemption u/s 10)(23C)(iiiad) filling of return of income as per the law applicable for AY 2005-06 and 2006-07 was not mandatory as the gross receipts not exceeded Rs. 1 crore and therefore, reopening the assessment alleging the non-furnishing of return as a reason to believe that income has escaped assessment is not valid in law.

Facts of the case:

• The assessee an educational society applied for registration u/s 12AA. The Assessing Officer noted from the financial statements filed along with application for registration that the assessee was earning profit consistently but never filed return of income.

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