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Learn MoreLorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book.
Learn MoreLorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book.
Learn MoreA voluntary organisation established on 6th July 1949, BCAS has presently more than 9,000 members from all over the country. BCAS is a principle-centered and learning-oriented organisation promoting quality service and excellence in the profession of Chartered Accountancy.
Learn MoreLorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book.
Learn MoreLorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book.
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The petitioner Institute was constituted under the Institute of Chartered Accountants Act, 1949, with the object to regulate the profession of Chartered Accountants in India and to ensure that the standards of professional knowledge and skill are met and maintained. Up to the
A.Y. 2005-06, the petitioner was granted approval for exemption u/s. 10(23C)(iv). Subsequent applications for approval were rejected on the ground that the Petitioner was holding coaching classes for preparing students for the examinations conducted by the Petitioner and was charging fees for the same.
The Delhi High Court allowed the writ petition filed by the petitioner against the said denial and held as under:
“i) Assessee’s activities fall within the definition of ‘charitable purpose’ in section 2(15) as it existed prior to 01-04-2009, under the category of ‘advancement of any object of general public utility’.
ii) The activity of the assessee in conducting coaching classes is integral to its activity of conducting the course in accountancy and the same cannot be equated with private coaching classes being conducted by organisations on commercial basis for preparing students to take entrance or other examinations in various professional courses.
iii) The reasoning of the DGIT that conducting interviews for a fee for the purposes of placement of its students by the assessee amounts to carrying on of a business is not sustainable. Campus interview is only a small incidental activity carried on by the assessee Institute like Universities for the placement of their students in gainful employment. This too is an activity ancillary to the educational programme being conducted by the assessee and cannot be considered as a business.
iv) The reasoning of the DGIT that since the assessee institute charges a uniform fee from all students it cannot be said to be carrying on a charitable activity is also erroneous. It is well settled that eleemosynary is not an essential element of ‘charitable purpose’ as defined under the Act. If the object or purpose of an institution is charitable, the fact that it collects certain charges does not alter the character of the institution.
v) Expression “trade”, “commerce” and “business” as occurring in the first proviso to section 2(15) must be read in the context of the intent and purport of section 2(15) and cannot be interpreted to mean any activity which is carried on in an organised manner. Purport of the first proviso is not to exclude entities which are essentially for charitable purpose but are conducting some activities for a consideration or a fee. Thus, where the dominant object of an organisation is of charitable nature, any incidental activity for furtherance of the object would not fall within the expression “business”, “trade” or “commerce”.
vi) Impugned orders passed by the DGIT refusing to grant exemption u/s. 10(23C)(iv) are set aside and he is directed to recognise the assessee as eligible for exemption u/s. 10(23C)(iv) as an institution established for charitable purposes.”