| COURT: | Supreme Court |
| CORAM: | R.F. Nariman J, T. S. Thakur J |
| SECTION(S): | 19(23C)(vi) |
| GENRE: | Domestic Tax |
| CATCH WORDS: | Charitable purpose, philanthropic purposes |
| COUNSEL: | - |
| DATE: | March 16, 2015 (Date of pronouncement) |
| DATE: | March 18, 2015 (Date of publication) |
| AY: | - |
| FILE: | Click here to view full post with file download link |
| CITATION: | |
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S. 10(23C)(v) & (vi): Mere surplus does not mean institution is existing for making profit. The predominant object test must be applied. The AO must verify the activities of the institution from year to year |
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The 13th proviso to Section 10(23C) is of great importance in that assessing authorities must continuously monitor from assessment year to assessment year whether such institutions continue to apply their income and invest or deposit their funds in accordance with the law laid down. Further, it is of great importance that the activities of such institutions be looked at carefully. If they are not genuine, or are not being carried out in accordance with all or any of the conditions subject to which approval has been given, such approval and exemption must forthwith be withdrawn. All these cases are disposed of making it clear that revenue is at liberty to pass fresh orders if such necessity is felt after taking into consideration the various provisions of law contained in Section 10(23C) read with Section 11 of the Income Tax Act
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