Commissioner of Income Tax vs Ranchi Loreto Educational Society

G. C. Bharuka, J.—The Income Tax Appellate Tribunal, Patna, has referred the following question of law for the opinion of this court u/s 256(1) of the Income Tax Act, 1961 (hereinafter to be referred to as "the Act").

"Whether, on the facts and in the circumstance of the case, the Appellate Tribunal was correct in law in holding that the assessee is an educational society and its entire income was exempt u/s 10(22) of the Income Tax Act, 1961 ?"

The present reference relates to the assessment year 1976-77. The assessee was assessed in the status of an "association of persons" on a total income of Rs. 20,620. The assessee claimed exemption u/s 10(22) of the Act on the ground that it was running an educational institution soley for educational purposes and not for the purpose of profit. The Income Tax Officer rejected the claim. On appeal by the assessee, the learned Appellate Assistant Commissioner allowed the exemption as claimed by the assessee. The Income Tax Officer preferred an appeal to the Tribunal but lost.

On the facts of the case, the Tribunal has held that the assessee was entitled to the claim.

I refrain myself from referring to the facts of the case in detail because it has been conceded by Mr. Vidyarthi, learned standing counsel appearing for the Department, that the case is squarely covered by the decision of this court in the case of Commissioner of Income Tax Vs. St. Xaviers, , where, on identical facts, a question similar to the one which has been referred in this case has been answered against the Department.

Keeping in view the above aspects and the reasons given by this court in the reported case referred to above, the question referred to this court in the present case is answered in the affirmative and against the Revenue. In the circumstances of the case, the parties shall bear their own costs.

Let a copy of this judgment be transmitted to the Assistant Registrar, Income Tax Appellate Tribunal, Patna Bench, Patna, in terms of Section 260 of the Act.

B.C. Basak, C.J.

I agree.