ACIT Vs Delhi Bureau of Text Books (ITAT Delhi)
Income Tax Appellate Tribunal (ITAT), Delhi Bench, has dismissed appeals filed by the Revenue, upholding the exemption granted under Sections 11 and 12 of the Income-tax Act, 1961, to the Delhi Bureau of Text Books. The ITAT ruled that the surplus generated from the sale of textbooks does not negate the charitable nature of the organization’s educational activities.
The case concerned the Assessment Years 2016-17 and 2017-18. The Delhi Bureau of Text Books, managed by officials from the Delhi Government’s Education Department, is involved in publishing and selling textbooks for Class I to VIII to government, MCD, NDMC, and Delhi Cantonment Schools. The books are reportedly sold at subsidized rates, with the organization also distributing free books and school bags to needy students.
The Assessing Officer (AO) had contended that the Bureau’s activities were commercial, citing significant profits (over Rs. 16 crore on sales exceeding Rs. 101 crore) from textbook sales. Consequently, the AO denied the Section 11 and 12 exemptions, treating the income as normal business income.
However, the Commissioner of Income Tax (Appeals) [CIT(A)] had allowed the exemption, relying on previous decisions, including a ruling by the Delhi High Court in the assessee’s own case.
