Tamil Nadu Cooperative Union vs ACIT (ITAT Chennai)
Co-operative Union Not an Educational Institution; Exemption u/s 10(23C)(iiiab) Denied, But Gross-Receipts Issue Remanded
Assessee, a Cooperative Society formed to impart cooperative education & training, claimed exemption u/s 10(23C)(iiiab) by treating itself as an educational institution substantially financed by Government. AO denied exemption holding that Assessee neither runs an educational institution nor is wholly or substantially financed by Government; CIT(A)/NFAC confirmed this view.
Tribunal upheld denial of exemption, observing that Assessee is only a union of cooperative societies collecting & managing Cooperative Education Fund contributions, not running any educational institution, & reliance was placed on Supreme Court ruling in Visvesvaraya Technological University. However, on separate ground that AO taxed entire gross receipts as income though Assessee claimed only 15% was its administrative entitlement & balance funds did not belong to it, Tribunal noted that NFAC failed to adjudicate this specific ground. Accordingly, while exemption u/s 10(23C)(iiiab) stood denied, issue relating to taxation of gross receipts was remanded to NFAC for fresh adjudication. Appeal partly allowed for statistical purposes.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
This appeal filed by the assessee – Cooperative Society against the order of the Ld. Commissioner of Income Tax (Appeal) / NFAC, [‘CIT(A)’ in short], Delhi dated 26.11.2024 for AY-2018-19.
