INDIAN INSTITUTE OF INFORMATION TECHNOLOGY AND MANAGEMENT-KERALA vs. THE COMMISSIONER OF INCOME TAX

ITA/1072/2009HC KeralaKLHC01025833200911 September 2018Author: HONOURABLE MR.JUSTICE K.VINOD CHANDRAN,HONOURABLE MR. JUSTICE ASHOK MENON6 pages
AI SummaryDismissed

What were the facts?

The appellant, Indian Institute of Information Technology and Management-Kerala (IIITM-K), a company wholly owned by the Government of Kerala, applied for registration under Section 12A of the Income Tax Act, 1961, for exemption under Section 11. The Assessing Officer rejected the application, holding that IIITM-K was not a charitable institution but an educational institution eligible for exemption under Section 10(23C)(iiiab). The Income Tax Appellate Tribunal upheld this decision. IIITM-K is engaged in imparting education and training in information technology and management. The dispute concerns whether IIITM-K qualifies for exemption under Section 11 as a charitable institution or is restricted to the exemption under Section 10(23C)(iiiab). The assessment year(s) are not explicitly stated, but the challenge is to the order of the ITAT in ITA 346/2002.

What did the High Court hold?

The High Court held that the appellant, IIITM-K, is an educational institution and not a charitable institution for the purposes of Section 11. The Court reasoned that while education is included in the definition of 'charitable purpose' under Section 2(15), a charitable institution must primarily include relief for the poor. The appellant's activities, described as conducting educational and training programs in information technology and management, do not demonstrate an intent to provide education for the poor or free of cost. The Court found that IIITM-K clearly falls within the definition of an "educational institution" under Section 10(23C)(iiiab), being solely for educational purposes, not for profit, and substantially financed by the Government. Therefore, the rejection of the application for registration under Section 12A and exemption under Section 11 was justified. The Tribunal's finding was upheld, and the appeal was rejected. No issue was expressly left undecided.

What were the issues?

1. Whether, on the facts and in the circumstances, the appellate tribunal was justified in holding that the appellant is not entitled to claim exemption under Section 11 of the Income Tax Act, 1961, and in rejecting its application. 2. Whether the appellate tribunal was justified in concluding that Section 10(23C)(iiiab) and Section 11 are mutually exclusive, and the applicability of the former rules out the latter. 3. Considering the legislative intent and the fact that the appellant imparts education not for profit, whether the appellate tribunal was justified in holding that Section 11 is ruled out when exemption is claimable under the specific provision of Section 10. Assessee's Contentions: The appellant argued that it falls within the definition of an institution constituted for a "charitable purpose" as defined under Section 2(15) of the Act, which includes education. Therefore, it should be entitled to the benefit of Section 11. Revenue's Contentions: The revenue contended that the only exemption IIITM-K is entitled to is under Section 10(23C)(iiiab) and that it is not a charitable institution as claimed.

Which sections of the Income-tax Act were involved?

Section 11,Section 2(15),Section 12A

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN & THE HONOURABLE MR. JUSTICE ASHOK MENON TUESDAY ,THE 11TH DAY OF SEPTEMBER 2018 / 20TH BHADRA, 1940 ITA.No. 1072 of 2009 AGAINST THE ORDER/JUDGMENT IN ITA 346/2002 of I.T.A.TRIBUNAL,COCHIN BENCH APPELLANT/S: INDIAN INSTITUTE OF INFORMATION TECHNOLOGY AND MANAGEMENT-KERALA TECHNOPARK, TRIVANDRUM. BY ADV. SRI.E.K.NANDAKUMAR (SR) SRI. ANIL D.NAIR SMT. PREETHA RESPONDENT/S: THE COMMISSIONER OF INCOME TAX TRIVANDRUM. BY SR.G.P. V.K. SHAMSUDHEEN THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 11.09.2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ITA 1072/2009 2

JUDGMENT Ashok Menon, J.

The assessee is on appeal challenging the order of the Income Tax Appellate Tribunal. The following questions of law arise for consideration: “I.

Whether on the facts and in the circumstances of the case, the appellate tribunal was justified in holding that the appellant is not entitled to claim exemption u/s.11 of the IT Act, 1961 and in rejecting the application filed before the respondent ? II.

Whether the appellate tribunal was justified in co

The order continues below.

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