High Court Of Punjab & Haryana
Scientific Educational Advancement Society vs. Union Of India
Section : 10(23C)(vi), 10(23C)(via)
Asst. Year 2008-09, 2009-10, 2010-11
M.M. Kumar & H.S. Bhalla, JJ.
Civil Writ Petn. No. 2052 of 2009
10th February, 2009
Counsel Appeared : S.K. Mukhi, for the Petitioner
JUDGMENT
M.M. Kumar, J. :
This petition filed under Art. 226 of the Constitution is directed against order dt. 7th Oct., 2008 passed by the Chief CIT, Panchkula declining the prayer of the assessee-petitioner for granting exemption under ss. 10(23C)(vi) and (via) of the IT Act, 1961 (for brevity ‘the Act’) in respect of asst. yrs. 2008-09 to 2010-11. On the basis of the written submissions made by the assesseepetitioner views of the CIT were obtained who had stated that both the AO and the Addl. CIT, Gurgaon did not recommend the case of the petitioner-assessee for grant of exemption. Accordingly the CIT did not recommend their case for exemption. There are certain facts which have gone into consideration for declining the exemption. There was a piece of land belonging to the petitioner-school-assessee at village Dhorka which was sold to a private builder on the plea that it would be hit by industrial zone. However, the builder has built flats on that area. The petitioner-assessee had purchased two farm houses constructed by M/s Ansal Group of builders who had built the same as residential units. The chairman of the petitioner-assessee along with his family members has been visiting the farm houses on weekend and no permission from any prescribed authority has been obtained for opening any educational institute on the property purchased. The income and expenditure account reveals that the land valued at Rs. 67,18,729 has been sold for a sum of Rs. 9,11,97,187 on 23rd Jan., 2007. There is a gross gain of Rs. 8,44,78,458. The major portion of the land was purchased on 10th Jan., 2001 and area of 9 kanals 6 marlas was purchased on 21st Nov., 2003. The Explanation furnished by the petitioner-assessee has been found to be unsatisfactory. In para 7 the Chief CIT has further concluded that after purchasing 45 kanals and 10 marlas land and 9 kanals 3 marlas of land in January, 2001 and November, 2003 in Dhorka there is nothing on the record to show that the petitioner-assessee intended to carry out any educational activities on the land. The only reason given for not using this land for educational activities and ultimately selling this land is that it was covered by industrial zone. However, the land purchased at Sadharana and Gopalpur also fall in the industrial zone. There is an obvious contradiction in the stand of the petitioner-assessee. The Chief CIT placing reliance on a judgment of Hon’ble the Supreme Court in the case of Municipal Corpn. of Delhi vs. Children Book Trust (l992) 3 SCC 390 has concluded as under :
14. It may be mentioned here that for the grant of exemption/approval under s. 10(23C)(vi), the basic requirement of sub-cl. (vi) of cl. (23C) of s. 10 is that the educational institution seeking exemption should be existing solely for the purpose of education and not for the purpose of profit. Here the emphasis is laid on the word ‘solely’. Considering the facts of the present case in entirety as discussed above in foregoing paras, it cannot be said that the society and the educational institution run by it are existing solely for the purpose of education and not for the purpose of profit. Accordingly, the application of the assessee seeking grant of exemption/approval is under s. 10(23C)(vi) for the asst. yrs. 2008-09 to 2010-11 is hereby rejected.”
2. Having heard learned counsel at some length we do not find any ground to admit the petition. The order of the Chief CIT does not suffer from any legal infirmity and the same is within four corners of law. The writ petition is consequently dismissed.
[Citation : 323 ITR 84]
