ARYA VIDYA SABHA/THROUGH ITS PRINCIPAL OFFICER SHRI ARVIND KUMAR,UTTAR PRADESH vs. ITO, EXEMPTION WARD, GHAZIABAD

ITA 5704/DEL/2025Status: DisposedITAT Delhi13 May 2026AY 2016-175 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the eligibility for exemption under Section 10(23C)(iiiad) should be considered for each educational institution separately, not on an aggregate basis. Therefore, the assessee is eligible for the exemption.

What were the facts?

The assessee, running five educational institutions, claimed exemption under Section 10(23C)(iiiad) of the Income Tax Act, 1961, stating each institution's receipts were below Rs. 1 crore. The AO disallowed the exemption, aggregating the receipts of all five institutions, which exceeded Rs. 1 crore.

What were the issues?

Whether the aggregate receipts of multiple educational institutions run by a single society should be considered for exemption under Section 10(23C)(iiiad), or if each institution should be assessed individually.

Which sections of the Income-tax Act were involved?

Section 10(23C)(iiiad)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “F” NEW DELHI

Before: SHRI CHALLA NAGENDRA PRASAD & SHRI SANJAY AWASTHI

For Appellant: Shri Ashwini Kumar, AR

For Respondent: Ms. Harpreet Kaur Hansra, Sr. DR

Hearing: 07.05.2026

PER SANJAY AWASTHI, ACCOUNTANT MEMBER:

This appeal arises from order dated 22.07.2025, passed u/s 250 of the Income Tax Act, 1961 (hereafter as “the Act”), by Ld. CIT(A)-NFAC, Delhi. In this case, the assessee is seen to be running five Educational Institutions. The return of income was filed on 28.03.2018 showing ‘NIL’ income. The assessee had claimed exemption u/s 10(23C)(iiiad) of the Act. The assessee had also filed details of receipts individually of the 5 Institutions and demonstrated that the receipts in each case were less 1

ITA No.5704/Del/2025 ARYA VIDYA SABHA than Rs.1 crore p.a. and thereafter had claimed the exemption u/s 10(23C)(iiiad) of the Act.

1.1 The Ld. AO disallowed the claim of exemption filed by the assessee on the ground that the aggregate annual receipts of the five Educational Institutions was in the region of Rs.3,00,73,132/-. On this basis the Ld. AO held that the aggregate receipts were significantly more than Rs.1 crore and thus, he held that the assessee was not entitled for any exemption u/s 10(23C)(iiiad) of the Act.

1.2 Aggrieved with this action, the assessee approached the CIT(A) where also he could not succeed since the Ld. CIT(A) has given a finding that all the five Educational Institutions are being managed by the assessing society and thus, the aggregate of receipts deserve to be adopted for the purposes of section 10(23C)(iiiad) of the Act.

1.3 The assessee, being further aggrieved, has approached the ITAT with grounds challenging the action of authorities below.

Before us the Ld. AR argued with the help of a paper book and demonstrated that the audited financial statements of the assessee and the five Educational Institutions were duly presented before the Ld. AO and it was not proper on his part to disregard the same and claim that such audited accounts were never presented before him. The Ld. AR filed the audited accounts before this Bench with a lengthy declaration from

ITA No.5704/Del/2025 ARYA VIDYA SABHA the Principal Trustee to the extent that such documents were very much before the authorities below. Thereafter, the Ld. AR relied on the case of Children’s Education Society reported in 34 taxmann.com 285 (Karn.). The Ld. AR read out various relevant paragraphs from this case law and especially brought to our notice para 22 of this order whereby it has been held that eligibility for exemption should be considered for each Institution separately since they would be controlled under various statutes for specific purposes. It is held in this case law that even if the management of these Educational Institutions would be in single hand but for all intents and purposes they are different and independent entities. The Ld. AR also relied on the case of M/s Vivekanand Society of Education & Research [ITA No.23/2014, order dated 29.12.2017] (J&K – HC). The Ld. AR pointed out that in this judgment the issue is even more clearly set out in para 10 and the question of law has been answered in favour of the assessee following the Children’s Education Society case (supra).

2.1 The Ld. DR relied on the orders of the authorities below and stated that for all intents and purposes the society was maintaining consolidated accounts and the five Institutions were running under its auspices.

We have carefully considered the rival submissions and have gone through the documents before us. We find that this issue needs to be decided in favour of the assessee following the Children’s Education Society case (supra) and the Vivekanand Society of Education & Research

ITA No.5704/Del/2025 ARYA VIDYA SABHA case (supra), where the courts have unequivocally held that each constituent Institution of a Society should be examined for the purposes of ascertaining the amount specified u/s 10(23C)(iiiad) of the Act. In the light of this, it deserves to be held that the assessee deserves to be considered for exemption u/s 10(23C)(iiiad) of the Act.

In the result, appeal of the assessee is allowed.

Order pronounced in the open court on 13.05.2026

Sd/- Sd/- (CHALLA NAGENDRA PRASAD) (SANJAY AWASTHI) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 13.05.2026 *Kavita Arora, Sr. P.S. Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI

ITA No.5704/Del/2025 ARYA VIDYA SABHA Sr. No. Particulars Date 1 Date of dictation of Tribunal Order 11.05.2026 2 Date on which typed draft Tribunal Order is placed before the 13.05.2026 Dictation Member 3 Date on which typed draft Tribunal Order is placed before the 13.05.2026 other Member (in the case of DB) 4 Date on which the approved draft Tribunal Order comes to the 13.05.2026 Sr. P.S. /P.S. 5 Date on which the fair Tribunal Order is placed before the 13.05.2026 Dictating Member for sign 6 Date on which the fair Order is placed before the other Member 13.05.2026 for sign (in the case of DB) 7 Date on which the signed order comes back to the Sr. P.S. /P.S 13.05.2026 for uploading on ITAT website 8 Date of uploading, if not, reason for not uploading 14.05.2026 9 Date on which the file goes to the Bench Clerk 14.05.2026 10 Date on which order goes for xerox 11 Date on which the file goes for endorsement 12 Date on which the file goes to the Superintendent/O.S. for checking 13 Date on which the file goes to the Assistant Registrar for signature on the order 14 Date on which the file goes to dispatch section for dispatch the Tribunal Order 15 Date of dispatch of order 16 Date on which file goes to Record Room after dispatch the order

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