- (1.) Challenge in the present writ petition is to an order passed by the respondent - Chief Commissioner Income Tax (Exemption), Panchkula on 18.01.2010 (Annexure P-1) declining application filed by the petitioner for approval under Section 10(23C)(vi) of the Income Tax Act, 1961 ('the Act'). The Haryana Private Universities Act, 2006 (for short "the Haryana Act") was enacted with a view to regulate the incorporation of private universities in the State. Section 6 of the Haryana Act provides for the establishment of a private University, as may be specified in the schedule. The petitioner - University was included in the schedule on 27.01.2009 vide Ordinance No. 4 of 2009. Thus the petitioner is a University constituted on 27.01.2009 with the objective to pursue educational activities.
(2.) The petitioner sought registration in Form No. 56D under Section 10(23C)(vi) of the Act on 29.01.2009 vide Annexure P-3. The Commissioner of Income Tax vide its report dated 20.10.2009 submitted that in terms of clause (iiiad) and clause (vi) of Section 10 (23C) of the Act, the income and expenditure, to prove the existence of the university or other educational institutions, must come from educational activities. The words 'aggregate annual receipts' appearing in clause (iiiad) implies that the annual receipts must be from educational activities and not out of other sources or donations. It was thus reported that though the petitioner has received a sum of Rs. 3,11,48,350/- during the financial year 2008-09, but that will not make the University eligible for exemption either under clause (iiiad) or under clause (vi) of Section 10(23C) of the Act.
(3.) In response to the said report, vide letter dated 10.12.2009 (Annexure P-4), the Petitioner inter alia asserted that any income received by the University or other educational institutions which is solely for educational purposes is the only requirement of the Statute. The expression 'aggregate annual receipts' used in Clause (iiid) and (vi) of Section 10(23C) of the Act is to divide Universities/ educational institutions into two categories i.e. one requiring approval and the other not requiring such approval though both institutions are contemplated to exist solely for educational purposes and not for the purpose of profit. It was averred that the primary purpose for making such categorization is to regulate the grant of exemption to University/educational institution having receipts, which is presently prescribed as Rs. 1 Crores in terms of clause (iiiad) of Section 10(23C) of the Act. In respect of such institutions, approval is not necessary whereas in respect of institution having more than the prescribed limit, the specific approval is required. It was also asserted that the petitioner has received corpus donation of Rs. 3 crores during the financial year 2008-09, which is not part of aggregate annual receipts, but an income defined in Section 2(24) of the Act, which includes all voluntary contributions received by an institution established under clause (iiiad) and (vi) of Section 10(23C) of the Act. It was also asserted that the eligibility of an institution for exemption under Section 10(23C)(vi) of the Act, is determined by the objects of the institution and more specifically the dominant object of the institution. Once the petitioner satisfies such conditions, the petitioner is eligible for approval under the Act. It was also pointed out that the petitioner actually started educational activities such as Jindal Global Law School in September, 2009 with its first academic year. Such Law School has been granted recognition by Bar Council of India, Law School Admission Council of USA and International Society of law Schools, USA.;