Hindi Sahitya Sammelan Vs Chief Commissioner of Income Tax (ITAT Allahabad)
ITAT Allahabad held that while rejecting the application for grant of approval u/s 10(23C)(vi) CCIT has not dealt with all the aspects in a comprehensive manner and hence the matter restored back for passing detailed and exhaustive order.
Facts-
The only question which has arisen here is that whether the assessee, Hindi Sahitya Sammelan, is entitled for exemption u/s 10(23C)(vi) of the Income Tax Act.
Assessee stated that earlier they were getting exemption u/s. 10(22) of the 1961 Act, and both Section 10(22) and Section 10(23C) (vi) of the Act are analogous. It was submitted that Hon’ble Allahabad High Court remanded the matter back to ld. CCIT for considering grant of exemption u/s 10(23C)(vi) of the 1961 Act. It was submitted by ld. Counsel for the assessee that the assessee is duly registered u/s 12A of the 1961 Act . It was submitted that now after amendment in the 1961 Act , the assessee is eligible for exemption u/s 10(23C)(vi) .
Conclusion-
Held that CCIT while rejecting application of the assessee for grant of approval u/s 10(23C)(vi) has not exhaustively dealt with all the aspects of the matter in a comprehensive manner. The matter needs to be restored back to CCIT for passing a detailed and exhaustive order by going through various activities carried on by the assessee, and then arriving at decision as to the allowability of claim of the assessee seeking approval u/s 10(23C)(vi).
The ld. CCIT shall also consider recent decision of Hon’ble Supreme Court in the case of PCIT v.Wipro Limited as the assessee in the instant case before us is already claiming benefit of exemption u/s 11 and 12 of the 1961 Act for all these years , on strength of registration u/s 12A , and accordingly returns were filed by assessee with Revenue for all those years. It is also claimed by assessee that exemption provisions are to be liberally construed , however we draw attention to Constitution Bench Judgment and Order of Hon’ble Apex Court in the case of Commissioner of Customs(Imports) , Mumbai v. Dilip Kumar & Co., wherein Hon’ble Supreme Court held that exemption provisions are to be strictly construed. We clarify that we have refrained ourselves from commenting on merits of the issue’s in this appeal, so that ld. CCIT can decide the issue unhindered by any of our observations.
FULL TEXT OF THE ORDER OF ITAT ALLAHABAD
These six appeals, filed by assessee, being ITA Nos.169 to 174/Alld./2017 for assessment year’s(ay’s): 2000-01 to 2003-04, 2006-07 and 2007-08, are directed against common order dated 03.08.2015 passed by ld. Chief Commissioner of Income-tax , Allahabad (hereinafter called “the CCIT”) u/s 10(23C)(vi) of Income-tax Act, 1961 (hereinafter called “the Act”) holding that the assessee does not qualify to be accorded recognition as a charitable institution for granting exemption u/s 10(23C) (vi) of the 1961 Act for assessment year’s (ay’s): 2000-01 to 2003-04 , 2006-07 and 2007-08.
2. The common grounds of appeal raised by assessee in all the six appeals in ITA Nos. 169 to 174/Alld./2017 for assessment year’s 2000-01 to 2003-04, 2006-07 and 2007-08, in memo of appeal(s) filed with Income-tax Appellate Tribunal, Allahabad Bench , Allahabad(hereinafter called “ the tribunal”) , reads as under:-
“1. That in any view of the matter order passed under Section 10(23C)(vi) of the IT Act dated 03.08.2015 by the Chief Commissioner of Income Tax, rejecting the claim of the exemption is highly unjustified/illegal when the Society is actively engaged in education activity from the date of its Inception of 1910 and the entire activity is within the frame work of the bye laws of the Society hence the approach of the lower authorities is not a judicious approach.
2. That in any view of the matter the order passed under Section 10(23C)(vi) of the IT Act dated 03.08.2015 by rejecting the application of the appellant by saying that the Society was conducting examination as prathma, madhyama, uttama and Visharad without holding teaching classes or lecture, hence it does not fall in the category of educational institution and injustice and liable to be set aside in the facts and circumstances of the case.
3. That in any view of the matter the Chief Commissioner of Income Tax recorded a finding that the appellant merely conducting examination based on own syllabus or courses and award degree in the name of parathma, Madhyama, Uttama and visharad in absence of normal schooling and therefore the appellant cannot be treated to be educational institution for educational purpose as for actual imparting of the education in school and college to the student are mandatorily is wholly misconceived and uncalled for and therefore the same is liable to be quashed.
4. That in any view of the matter the order of the Chief Commissioner of Income Tax, Allahabad rejecting the exemption application under Section 10(23C)(vi) of the IT Act by relying on the decision in the case of SOLE TRUSTEE LOK SHIKHSAN SANSTHAN Vs. CIT reported in (1975) 101 ITR 234 (SC) is wholly misconceived and liable to be set aside as the said decision is prior to insertion of section 10(23C)(vi) of the Act by Finance (2) Act 1998 as such the same cannot be basis for rejecting of exemption application.
5. That in any view of the matter Lower authority failed to consider that the appellant Society is printing and publishing educational books, magazine, other literatures and also maintaining big Hindi library and museum/manuscripts having more than lacs books hence the order dated 03.08.2015 is misconceived, unjustified and illegal therefore the same is liable to be set aside in all fairness and interest of justice.
6. That in any view of the matter since the appellant Society has been treated educational Society by the department from the date of its inception i.e. 1910 to assessment year 1999-2000, registration under Section 12AA of the IT Act was granted, Society is registered under the Society Act and also not involved in any profit motive till date, therefore without any change in similar set of fact, forming of a different view during the assessment years in question arbitrarily by the chief Commissioner of Income Tax, Allahabad to debar the appellant society from due justice is highly unjustified, illegal, unethical and injustice, hence the Society deserves to get its genuine claim of exemption.
7. That on 23.07.2015 the appellant submitted detail reply before the Chief Commissioner of Income Tax, Allahabad regarding the non-applicability of the decision reported in (1975) 101 ITR 234 (SC) in the appellant’s present case in view of the amendment but the learned Chief Commissioner has erred in not dealing with the objection, therefore the impugned order is illegal and liable to be set aside and the exemption application deserves to be allowed in interest of justice.
8. That in view of the matter the finding of the Chief Commissioner of Income Tax, that the aim, objects and the activities of the appellant Society could not be held as education as it was not in a process of training and development of students in normal school is wholly misconceived and therefore liable to be set aside as the term ‘educational purpose’ is not restricted merely to holding classes or normal schooling, as the holding of the classes is not mandatory for the institution to qualify and to be treated as educational institution especially when the appellant Society publishes education book, maintaining library and undertakes examination on the basis of its own syllabus.
9. That in any view of the matter with regard to the exemption under Section 10(23C)(vi) of the IT Act, as inserted by Finance (2) Act 1998 with effect from 01.04.1999 it is a settled principle that the exemption provisions are to be examined in liberal manner with judicious approach and this view is duly supported by the decision of the apex court also reported in (2006) 204 CTR 27 in the case of P R Prabhakar Vs. CIT, hence the lower authority failed to consider the issue fairly in the light of cited decision which is injustice.
10. That in any view of the matter exemption had been granted to the appellant Society section 11 and 12 of the IT Act in earlier years and during the year also in question hence there was no change in the circumstances/ consistency and in its activity, hence there was no justification to warrant a different approach during the assessment years in question.
11. That in any view of the matter in the appellant’s own case the jurisdictional High Court in the writ petition in various cases connected with labour matter under the Bonus Act held that the appellant society is an educational institution and not a commercial establishment hence the order dated 03/08/2015 is bad in law contrary to the said decision.
12. That in any view of the matter observations and findings of the chief Commissioner of Income Tax, Allahabad in his order dated 03/08/2015 for rejecting the appellant’s genuine claim are quite misleading unjustified, wrong and contrary to the actual facts of the case therefore the same deserves to be sponged of and the claim of the appellant be allowed in interest of justice.
13. That in any view of the matter the delay in filing appeal against the order dated is 03/08/2015 due to mistaken impression, unintentional and bona fide belief hence the delay is liable to be condoned in the facts and circumstances of the case.
14. That in any view of the matter the appellant reserves his right to take any fresh ground of appeal before hearing of the appeal.
2b. The assessee has also raised additional grounds of appeal for all the six ay’s: 2000-01 to 2003-04 , 2006-07 and 2007-08, as under:
“1. That in any view of the matter according to the syllabus of the appellant the various centres situated in the country are imparting education to the student with respect those subject, over which the appellant is conducting examination and awarding degree of Prathima, Dwitya and madhama which are equivalent to High School Inter and B.A.
The learned prescribed authority did not appreciate the aforesaid fact while rejecting the exemption u/s 10(23C) of the Act to the appellant.
2. That in any view of the matter in the appellant own case the Hon’ble Jurisdiction High Court observed and held that the assessee have been granted registration u/s 12A, the object of the society are of the general public utility as defined u/s 2(15) of the Act, and held that there is no instance of misuse of fund by the trustees hence in the light of such observation of the court claim of the appellant u/s 10(23C)(vi) deserve to be allowed.
3. That in any view of the matter from the year of inception of the society, the claim u/s 10(22) was allowed by holding the society as educational institution hence in the light of Principles of consistency rejection of claim u/s 10(23C)(vi) is unwarranted and not liable to be sustained.
4. That in any view of the matter “educational purpose” was not restricted to holding of teaching classes but educational purpose was equally served with educational text book and the courts have repeatedly held that holding of classes are not necessary hence the decision referred in the impugned order is not applicable.
5. That in any view of the matter the Hon’ble Allahabad High Court in the petitioner matter about the dispute of Labour Law with employees observe that the law is not applicable to the society because the society is the educational institution hence claimed u/s 10(23C)(vi) is allowable.”
3. These six appeals filed by assessee for assessment year’s 2000-01 to 2003-04 , 2006-07 and 2007-08, are all against common order dated 3rd August, 2015 passed by Learned Chief Commissioner of Income Tax, Allahabad, holding that the assessee does not qualify to be accorded recognition as a charitable institution for granting exemption u/s 10(23C)(vi) of the 1961 Act , for ay’s : 2000-01 to 2003-04 , 2006-07 and 2007-08.
4. The ld. Counsel for the assessee opened arguments before the tribunal and submitted that in all these six appeals filed by assessee for ay’s: 2000-01 to 2003-04, 2006-07 and 2007-08, the only question which has arisen for adjudication before the Division Bench is as to whether the assessee is entitled for exemption under Section 10(23C)(vi) of the 1961 Act or not , keeping in view facts and circumstances of the case. The learned counsel for the assessee drew our attention to Paper Book-1 filed by the assessee / page no. 1-42 , wherein written submission of the assessee before tribunal are filed. The ld. Counsel for the assessee also drew our attention to Page no.48 to 50 of the Paper Book-1 filed by the assessee and it was submitted that the assessee is providing education to students by conducting various courses named Prathama, Madhyama and Uttama. The ld. Counsel for the assessee submitted that these courses are duly recognized by various Universities and Boards ,wherein its degrees are recognized. Our attention was drawn to page No. 84 of the Paper Book-1, wherein order of the Hon’ble Allahabad High Court in Writ Tax No. 443 of 2011 , dated 28.01.2015 is placed. The Learned counsel for the assessee submitted that the assessee was earlier getting exemption under Section 10(22) of the 1961 Act, and both Section 10(22) and Section 10(23C) (vi) of the Act are analogous. It was submitted that Hon’ble Allahabad High Court remanded the matter back to ld. CCIT for considering grant of exemption u/s 10(23C)(vi) of the 1961 Act. It was submitted by ld. Counsel for the assessee that the assessee is duly registered u/s 12A of the 1961 Act . It was submitted that now after amendment in the 1961 Act , the assessee is eligible for exemption u/s 10(23C)(vi) . Our attention was also drawn to Paper Book / Page No. 127 wherein tribunal in ITA No. 26/Alld/2006 vide order dated 9th of March 2006 has directed that registration granted in favour of the assessee under Section 12A(a) of the Act to be effective from 26th May, 1982. It was submitted that earlier the assessee was getting exemption under Section 10(22) of the 1961 Act. Our attention was also drawn by ld. Counsel for the assessee to Page No. 149 of the Paper Book-1 and it was submitted that vide order dated 4th January, 2005 passed by Hon’ble Allahabad High Court, it is recognized that the assessee is an educational institution although said order was passed in a matter concerning labour laws. Our attention was further drawn by ld. Counsel for the assessee to page 159 of the Paper Book-1 wherein the order dated 05th December, 1995 of Hon’ble Allahabad High Court is placed , and in which the assessee was held to be educational institution in a matter concerning payment of Bonus to employees.Our attention was also drawn by ld. Counsel for the assessee to Page No.87 of the Paper Book-1, wherein order dated 25.07.2014 passed by Hon’ble Allahabad High Court in ITA No. 341 of 2010 for ay: 2000-01 is placed , in which the Hon’ble Allahabad High Court upheld that the assessee is entitled for exemption under Section 11 of the 1961 Act , by holding as under:
“The brief facts of the case are that the assessee-respondent is a society created on 1.5.1910 and registered under the Societies Registration Act, 1860, which was established by the founders of the Society namely, Pandit Madan Mohan Malviya Mahatma Gandhi, Dr. Rajendra Prasad and Rajarshi Purshottam Das Tandon.
The Society is engaged in various types of educational activities from the date of its inception such as popularising national language ‘Hindi’ in public at large. It is conducting various types of examination based on own syllabus and to award various degrees to qualified candidates, also maintains a big library which is running in a big compound. It also published the books and other literature. It has about thousand centres at various places in India and having about a lakh students on its role. The books of account were properly maintained and were audited. No defect was found by the A.O. in the books of accounts.
However, for the assessment year under consideration, the A.O. has declined to extend the benefit of Section 11 of Income Tax Act, though the Society is registered under Section 12A of the Act. Finally the A.O. made various additions, which were deleted by the CIT (A) as well as by the Tribunal.Being not satisfied, the Department has filed the present appeals.
With this background we heard Shri Shambhu Chopra, the learned counsel for the Department-appellant and Shri Rakesh Ranjan Agarwal, the learned Senior Counsel assisted by Shri Vijai Kumar Agarwal, the learned counsel for the respondent-assessee.
Having heard both the parties and on perusal of the record, it is an undisputed fact that the assessee has been granted registration under Section 12A of the Act. The objects of the Societies are the general public utility as defined under Section 2(15) of the Act. No action was taken by the A.O. under Section 12-AA(3) of the Act, before denied the benefit, but directly disallowed the exemption/benefit under Section 11 of the Act. From the order of the CIT (A), it appears that there is no instance of misuse of the funds by the trustees of the Society.
The grant of exemption under Section 11 is not automatic and the assessee shall have to meet out the requirements of Section 11 of the Act. Once, the registration is granted to the assessee under Section 12-A, then the A.O. cannot pass a contrary order without following the provisions of Section 12AA(3), but the same was not done in the instant case. When it is so, then by keeping mind the ratio laid down in the case of CIT Vs. Gujarat Maritime Board, 295 ITR 561 SC, as well as C.M.S. Vs. Union of India, 315 ITR 48 Allahabad, we find no reason to interfere with the impugned orders passed by both the Appellate Authorities, the same are hereby sustained along with the reasons mentioned therein.
No substantial question of law is emerging from the impugned orders. The appeal filed by the department against the judgment and order dated 23.02.2010 passed by the Income Tax Appellate Tribunal, Allahabad in I.T.A.T. No. 49/A/2009 & 09/A/2009 for the Assessment Year 2000- 01 is dismissed at the admission stage.”
It was submitted by ld. Counsel for the assessee that the above order passed by Hon’ble Allahabad High Court has attained finality. The learned senior counsel for the assessee submitted that registration under Section 12A was granted to the assessee by tribunal with effect from 26th May, 1982.Our attention was drawn to tribunal order dated 09.03.2006 wherein tribunal in ITA No.26(Alld.)/2006 modified the order passed by ld. CIT dated 20.12.2005 granting application u/s 12A(a) of the 1961 Act effective from 01.04.2005, to be taken as effective from 26.05.1982(PB-1/page127-134). Our attention was also drawn to Page No.98 of the Paper Book-1 , wherein order of the tribunal in ITA No. 193-197/Alld/2013 for ay’s: 2000-01, 2001-02, 2004-05, 2005-06 and 2006-07 , vide common order dated 30.09.2016 is placed , wherein tribunal has accepted the claim of the assessee for grant of exemption under Section 11 of the Act for the aforesaid assessment years. Our attention was also drawn by ld. Counsel for the assessee to page No.214 to Page No. 367 of Paper Book-1 filed by the assessee , and it was submitted that there are several centers of the assessee at various place in India and abroad ,wherein teaching is carried out. It was submitted that Ld. CCIT vide order dated 3rd August, 2015 has denied the assessee’s claim of exemption under Section 10(23C)(vi) by rejecting its application for grant of exemption u/s 10(23C)(vi) by relying upon decision of Hon’ble Supreme Court in the case of Sole Trustee Lok Shikshan Trust v. CIT (1975) 101 ITR 234(SC) and decision of Hon’ble Gujarat High Court in the case of CIT v. Sorabji Nusserwanji Parekh (1993) 201 ITR 939 (Guj.HC) . The ld. Counsel for the assessee submitted that it is not necessary that there should be normal schooling to be eligible for exemption u/s 10(23C)(vi) , and reliance was placed by ld. Counsel for the assessee on following judgments :-
a) Judgment and Order passed by Hon’ble Gujarat High Court in the case of Gujarat State Co-operative Union v. CIT , reported in (1992) 195 ITR 279(Guj. HC)
b) Judgment and Order passed by Hon’ble Gujarat High Court in the case of Director of Income-tax(Exemption) v. Ahmedabad Management Association , reported in (204) 366 ITR 85(Guj. HC)
c) Judgment and Order passed by Hon’ble Madras High Court in the case of Investor Financial Education Academy v. ITO , reported in (2020) 16 ITR-OL176(Mad. HC)
d) Judgment and Order passed by Hon’ble Gujarat High Court in the case of CIT v. Sorabji Nusserwanji Parekh , reported in (1993) 201 ITR 939(Guj. HC)
e) Judgment and Order passed by Hon’ble Delhi High Court in the case of Council for the Indian School Certificate Examinations v. Director General Of Income-tax , reported in (2012)362 ITR 436(Del HC)
f) Judgment and Order passed by Hon’ble Gujarat High Court in the case of Director of Income-tax(Exemption) v. Ahmedabad Management Association , reported in (2014) 366 ITR 85(Guj. HC)
g) Judgment and Order passed by Hon’ble Delhi High Court in the case of Delhi Bureau of Text Books v. Director of Income-tax (Exemption) , reported in (2017) 394 ITR 387(Del HC)
h) Judgment and Order passed by Hon’ble Allahabad High Court in the case of Simpkins School v. Director General Of Income Tax (Investigation) & Ors. , reported in (2014) 367 ITR 335(Alld. HC)
i) Judgment and Order passed by Hon’ble Bombay High Court in the case of Director of Income-tax v. National Safety Council, reported in (2008)305 ITR 257(Bom HC)
j) Judgment and Order passed by Hon’ble Rajasthan High Court in the case of Agarwal Shiksha Samiti Trust v. CIT , reported in (1988) 168 ITR 751(Raj. HC)
k) Judgment and Order passed by Hon’ble Rajasthan High Court in the case of CCIT v. Geetanjali University Trust, reported in (2013) 352 ITR 433(Raj. HC)
l) Judgment and Order passed by Hon’ble Delhi High Court in the case of Delhi Music Society v. DGIT , reported in (2013) 357 ITR 265(Del HC)
m) Judgment and Order passed by Hon’ble Calcutta High Court in the case of Creative Music Designers v. ITO(E) , reported in (2022)443 ITR 173(Calcutta HC)
n) Judgment and Order passed by Hon’ble Supreme Court in the case of American Hotel & Lodging Association, Educational Institute v. CBDT , reported in (2008) 301 ITR 86(SC)
o) Order passed by ITAT, Delhi in the case of Haryana State Remote Sensing Application Centre v. CIT(E ) , reported in (2022) 193 ITD 706(Del-trib.)
p) Judgment and Order passed by Hon’ble Delhi High Court in the case of Director of Income-tax Exemptions v. Escorts Cardiac Diseases Hospital Society , reported in (2008) 300 ITR 75(Del HC)
q) Judgment and Order passed by Hon’ble Supreme Court in the case of Aditanar Educational Institution v. Additional CIT, reported in (1997) 224 ITR 310(SC)
r) Judgment and Order passed by Hon’ble Bombay High Court in the case of Tolani Education Society v. Deputy Director of Income-tax(Exemptions) , reported in (2013)351 ITR 184(Bom)
s) Judgment and Order passed by Hon’ble Delhi High Court in the case of CIT v. Lagan Kala Upvan , reported in (2003) 259 ITR 489(Del HC)
t) Judgment and Order passed by Hon’ble Delhi High Court in the case of CIT v. Delhi Kannada Education Society, reported in (2000) 246 ITR 731(Del HC)
u) Judgment and Order passed by Hon’ble Delhi High Court in the case of DDIT v. Shanti Devi Progressive Education Society , reported in (2011) 340 ITR 320(Del )
v) Judgment and Order passed by Hon’ble Delhi High Court in the case of Digember Jain Society for Child Welfare v. DGIT(E), reported in (2010) 329 ITR 459(Del)
w) Order passed by ITAT, Jaipur in the case of Singhania University v. CIT, reported in (2021) 210 TTJ 161(Jp.-trib.)
x) Order passed by ITAT, Delhi Benches in the case of ACIT(Exemptions) v. India Habitat Centre , reported in (2021) 86 ITR(T) 290(Del.-trib.)
y) Order passed by ITAT, Hyderabad Benches in the case of ADIT(E) v. Hyderabad Study Circle , reported in (2015) 38 ITR 293(Hyd-trib)
z) Order passed by ITAT, Mumbai in the case of Indian Institute of Banking and
aa) Finance v. CIT(E) , reported in (2020)186 DTR 108(Mum-trib.) aa) Order passed by ITAT, Mumbai in the case of Indian Institute of Bankers v. DDIT(E) , reported in (2002)74 TTJ 523(Mum-trib.)
bb) Orders passed by ITAT, Rajkot in the case of Rajkot Visha Shrimali Jain Samaj v. ITO , reported in (2008)111 ITD 238(Rajkot-trib.)
The ld. Counsel for the assessee drew our attention to the page 57-60 of Paper Book-IV filed by the assessee, which contains specimen degrees awarded by the assessee. The assessee has also filed copy of registration certificate dated 20th December, 2005 granting registration U/S 12AA w.e.f. 01.04.2005(Paper Book –V/Page 1) , as also the assessee has filed certificates regarding recognition of educational institution by various authorities and various Universities , which are placed at page 4-61 in paper book-V filed on 20th July, 2022 by assessee.
4b. The Learned CIT-DR, on the other hand submitted that application filed by the assessee for grant of exemption under section 10(23C)(vi) was rejected by Ld. CCIT, vide common order dated 03.08.2015 for ay’s: 2000-01 to 2003-04, 2006-07 and 200708. It was submitted by ld. CIT-DR that the assessee was granted exemption under Section 11 and 12 of the 1961 Act for ay: 2000-01 . It was submitted by ld. CIT-DR that for ay: 2005-06 , the assessee was granted exemption u/s 11 and 12 of the 1961 Act. Our attention was drawn to judgment and orders passed by Hon’ble Allahabad High Court in ITA No. 340 and 341 of 2010, both dated 25.07.2014, for ay: 2000-01 and 2005-06. (paper book-1/ page 90-92 and 87-89). Our attention was drawn by learned CIT DR to page No. 193-194 of the Paper Book-1 filed by the assessee , wherein Press Note dated 05.05.1988 issued by Education Department, Ministry of Human Resources Development, New Delhi is placed , wherein the Ministry clarified that the examination conducted by the assessee are not recognized by Central Government as equivalent to High School, Intermediate or BA. It is clarified in the aforesaid Press Note that the assessee was only granted recognition to conduct examination in Hindi Subject . The ld. CIT-DR relied upon the decision of Hon’ble Supreme Court reported in AIR 2002 Supreme Court 2642, State of Rajasthan v. Lata Arun, dated 17th July, 2002. The Ld. CIT DR submitted that the assessee is a voluntary association for promotion of Hindi and is not recognized by any Board /University. By referring to para 5 of the aforesaid Judgment and order of Hon’ble Supreme Court in the case of Lata Arun(supra), the ld. CIT-DR submitted that the educational qualification by way of Madhyama Certificate issued by the assessee, was previously recognized as equivalent to a Degree in Hindi, but the said recognition ceased to be operative w.e.f. 1.4.1985. The ld. CIT DR further referred to a letter dated 4.12.1991 addressed by Deputy Secretary, Association of Indian Universities, New Delhi written to the Registrar, Rajasthan Nursing Council, Jaipur, in which it was stated “ Hindi Sahitya Samellan , Prayag, Allahabad is one of the voluntary Hindi Institution set up for promotion of Hindi. Its exams are not equated with the regular examinations of Secondary Boards/Universities. Our attention was drawn to para 14 , wherein Hon’ble Supreme Court observed that the Madhayama Certificate from Hindi Sahitya Sammelan Prayag, Allahabad was deleted from the recognized qualifications by the notification dated 28.6.1985. It is also brought to our notice from para 12, that Hindi Sahitya Sammelan, Allahabad, was recognized for the period from 1931 to 1967 only, with respect to diploma/degree of Vaidya Visharad or Ayurveda Ratna issued by it. The ld. CIT DR submitted that Section 6 of The Hindi Sahitya Sammelan Act, 1962 provides that the assessee is only for promotion of Hindi language, and our attention was drawn to page 174 of the Paper Book- 1 filed by the assessee. The ld. CIT DR relied upon decision of Hon’ble Gujarat High Court in the case of Saurashtra Education Foundation v. CIT , reported in (2005) 273 ITR 139(Guj. HC),and submitted that Educational institution which is recognised by any competent authority and imparts formal education systematically and has control over its trainees, is eligible for exemption under section 10(22) of IT Act . There has to be registration with authority and answerability to the authority. The ld. CIT DR submitted that Section 10(23C) contemplates exemption to institutions existing exclusively and solely for educational purposes. The ld. CIT DR relied upon judgment and order passed by Hon’ble Delhi High Court in the case of Council for the Indian School Certificate Examinations v. DGIT reported in (2014)362 ITR 436(Del HC), it was submitted that the appellant cannot be treated as the educational institution existing solely for educational purposes and it cannot be compared with the ISCE. The Ld. CIT DR prayed that the order of ld. CCIT be confirmed.
4c. In rejoinder, the Ld. counsel for the assessee drew our attention to Page No. 17 of the paper book of case law and submitted that Hon’ble Gujarat High Court in a subsequent decision in the case of DIT(E) v. Ahmadabad Management Association reported in (2014) 366 ITR 85(Guj) distinguished the decision of Saurashtra Education Foundation(supra) . It was submitted that the assessee is imparting education in Hindi. Our attention was drawn to page No. 177 of the paper book , and in particular to various clauses of Sections 6 of The Hindi Sahitya Sammelan Act, 1962 to submit that the assessee is engaged in imparting education. Our attention was also drawn to page no. 61 of the paper book-V filed by the assessee, wherein Uttama Certificate awarded by the assessee is recognized by Punjabi University, Patiala. Our attention was also drawn to page 1 of PB-V , wherein registration granted by ld. CIT under Section 12AA w.e.f. 01.04.2005 is placed. The Ld. counsel for the assessee relied upon decision of Hon’ble Allahabad High Court in the case of J K Bankers v. CIT, reported in (1974) 94 ITR 107(All. HC) , and explained the powers of tribunal , which cannot go beyond the subject matter of appeal. The ld. Counsel for the assessee also relied upon the decision of Hon’ble Allahabad High Court in the case of S P Kochhar v. ITO, reported in (1984) 145 ITR 255(All. HC).
5. We have considered rival contentions and perused the material on record including cited cases laws. At this stage it will be relevant to give complete background of the case. The assessee had filed an application in From No. 56-D for grant of exemption under Section 10(23C) (vi) for assessment year 2000-01 to 2003-04, 2006-07 and 200708 before learned Chief Commissioner of Income Tax, Allahabad, belatedly beyond the time prescribed for filing the aforesaid applications. The ld. CCIT dismissed the application for assessment year’s 2000-01 to 2003-04 and 2007-08 vide orders dated 21st June, 2010 and application for ay: 2006-07 was dismissed by ld. CCIT vide orders dated 22.06.2010, on the grounds that there was delay in filing of Form No. 56D and thus the same being prima facie non maintainable. The assessee being aggrieved by the aforesaid order’s of Ld. CCIT dismissing the applications filed by assessee for ay: 2000-01 to 2003-04 , 2006-07 and 2007-08 in Form No. 56D as not maintainable , filed Writ Petition before Hon’ble Allahabad High Court in Writ Tax No. 443 of 2011 , which stood allowed by Hon’ble Jurisdictional High Court vide orders dated 28.01.2015, wherein Hon’ble High Court was pleased to set aside the impugned order’s passed by ld. CCIT and condone the delay with a direction to the competent authority to pass afresh order on merit for the above mentioned assessment years 200001 to 2003-04, 2006-07 and 2007-08 at the earliest, preferably within a period of 4 months after receiving certified copy of the order passed in Writ Tax No. 443 of 2011, dated 28th January, 2015 , by holding as under:
“By this writ petition, the petitioner has assailed the order dated 9/10 August, 2010 passed by the department of the revenue where the application for relaxation of time in filing the petition under Section-10(23C) (vi) was rejected for the assessment years 2000-01, 2001-02, 2002-03, 2003-04, 2006-07 & 2007-08.
Sri Shakeel Ahmad, learned counsel for the petitioner submits that the petitioner-society was registered under Section-12-A and also exempted under Section-10(22) of the Act till assessment year 1999-2000. For the assessment year under consideration, the assessments were completed and there was no occasion to the petitioner to file any fresh application for exemption. The society was under bona-fide belief that exemption is continuing but w.e.f. 01.06.2006, the second amendment came into force where fresh application for exemption was required. Only after receiving the notice under Section-148, the society had approached the authorities for the exemption alongwith application for condonation of delay. By the impugned order, the authority concerned has rejected the application for condonation of delay. He further submits that there was no mistake on the part of the society-assessee.
On the other hand, Sri Sambhoo Chopra, learned counsel for the department has submitted that there was no genuine hardship as rightly observed in the impugned order, so the application for condonation of delay was rightly rejected.
We have heard both the parties at length and gone through the materials available on record. It may be mentioned that the Income Tax Act is most complicated piece of legislation. The assessee-society is exclusively engaged for the promotion of Hindi language, so amendment was not known to assessee. In the instant case, the assessee-society was already enjoying the benefit under Section-10(22) of the Income Tax Act and was under bona-fide belief that exemption is continuing. The assessee was totally ignorant about the amendment and department is not supposed to take the advantage of the ignorance of the assessee as per CBDT Circular No. 14 (XL-35)/1955 dated 11 April, 1955 (published in 150 ITR 105).
In the circumstances mentioned above, we set-aside the impugned order and condone the delay with a direction to the competent authority to pass afresh order on merit for the above mention assessment years at the earliest, preferably within a period of four months soon after receiving the certified copy of this order.
In the result, the writ petition is allowed.”
Then the matter again reached Ld. CCIT for passing fresh orders as directed by Hon’ble Jurisdictional High Court. The ld. CCIT dismissed the application’s filed by assessee in Form No. 56D by holding that the assessee does not qualify to be accorded recognition as a charitable institution for granting exemption u/s 10(23C)(vi) of the 1961 Act for ay’s: 2000-01 to 2003-04, 2006-07 and 2007-08, vide common order dated 3rd August, 2015 , by holding as under:
“4. Vide its written submission filed on 16.07.2015, the assessee society has submitted as under;
“…… That the other activities of the Society is to provide education to the students in form of Prathama, Madhyama, Uttama. The subjects of the said courses in brief are as under:-
Prathama (Equivalent to High School):
1. Hindi Sahitya
2. History
3. Geography
4. Science
5. Mathematics
6. Home Science for Ladies only.
Madhyama (Equivalent to Intermediate):
