The Institute of Chartered Accountants of India v Director General of Income Tax (2012) 347 ITR 99 (Delhi)

The document in question is about the case of The Institute of Chartered Accountants of India v Director General of Income Tax. It is a dispute over the tax exemption of the institute under section 10(23C)(iv) of the Act. The Delhi High Court ruled that the existence of a surplus from ancillary activities does not necessarily mean that the institute's charitable purpose ceases to exist. The court emphasized that the nature of the predominant activity should be the determining factor in assessing the institute's charitable status.
The Institute as such merely it is receiving coaching fee from students for imparting education, cannot be said to have been carrying on business and accordingly it is not required to maintain separate books of accounts as alleged by DIT(E). The income of the coaching classes earned by the assessee institute is within its objects and its Regulations and further these activities are educational activity within the definition of section 2(15) of the Income Tax Act, 1961, and consequently therefore cannot be activity of business for which separate books of accounts are required to be maintained. The order of the learned DIT(E) is therefore not sustainable as the income of the Institute is exempt not only u/s 10(23C)(iv) but also under section 11. The institute is an educational institute and hence its income will also be exempt under section 11 as education falls within the meaning of charitable purpose under section 2(15) of the Act."