Allowing the appeal of the Revenue the Court held that  the sister trusts in whose favour donations had been made in close proximity to the admissions made in respect of the students, were run by common controlling trustees. What educational institutions were doing directly prior to the coming into force of the 1992 Act, was now being done in a manner as to doubly benefit them by not only indulging in such statutory offences but also seeking the benefit of tax exemptions by adopting a special modus operandi. Since the assessee-trusts were controlled by common trustees and were indeed sister trusts, the court could lift the veil to see the real beneficiaries and the object of the donations by relatives and friends of parents as quid pro quo for admissions into the assessee’s educational institutions as well as the other assessees who were not educational institutions. An elaborate exercise was undertaken by the Assessing Officer by issuing summons to various persons and their sworn statements were recorded. These sworn statements pointed to the factum of payment of amounts extending to at least around Rs. 5 lakhs in each of the cases as well as the nexus between the assessee-institutions. The fact that these payments were made by the relatives and friends of the parents of the students who obtained admission in the assessee-institutions would prove the nature of the donations and the reasons therefor. That apart, it was clearly evident that the funds given for admissions, had been routed through the other trusts. The statements given to the Assessing Officer under section 132(4) had legal force. Unless retractions are made within a short span of time, supported by affidavit swearing that the contents were incorrect and that the statement was obtained under force, coercion and by lodging a complaint with higher officials, they could not be treated as retracted. The very modus operandi adopted by the educational institutions was not in the form of direct coercion, but in the manner of admitting students on the clear understanding that such seats were offered in return for donations, which were nothing but capitation fee. The fact that a long-winding and indirect route had been adopted for capitation fee to reach the institution could not change the character of the payment from an illegal capitation fee to a voluntary contribution or donation. The amounts collected by the assessees were capitation fee as quid pro quo for allotment of seat in deviation of the Tamil Nadu Educational Institutions (Prohibition of Collection of Capitation Fee) Act, 1992 and were neither a voluntary contribution nor to be treated as applied for charitable purpose. That apart, the fact that no action had been initiated by the State could not be a reason to allow the exemption under the provisions of the Act or absolve the assessees of the liability, that too after the device to route the capitation fee was discovered. Further, it is also settled law that illegality cannot be perpetuated. Similarly, any decision even in the assessees’ own cases could not have any bearing on the adjudication of the issues because each assessment is independent and had to rest on its own facts. When the contributions could not be treated as voluntary, the further question of their application to charitable purposes or otherwise, need not be gone into, meaning thereby that the assessees were not entitled to the benefits of sections 11 and 12 of the Act.  The assessing authority was directed to cancel the registration  and also proceed to reopen the previous assessments , if permissible by law , based on tangible materials relating to  collection of capitalisation fee , since it is illegal and is punishable .(AY.2011-12  to 2014-15)