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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 February 2013 income from hostels and bus facilities of an educational institutions is commercial or charitable activity?

Guest

Guest (Expert)

16 February 2013 if they receive any fee from student then its commercial

Nikhil Kaushik

Nikhil Kaushik (Expert)
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16 February 2013 I will prefer to disagree with CA Vivek.

Charging of fees can not be the sole ground for denial of charitable nature under income-tax. Charitable schools are allowed to charge fees. It is the overall nature of the activity that is relevant and the overall operations of the school should be directed towards needy students.

For a better idea of what constitutes running a school on commercial lines kindly refer to the ITAT judgment in the case of M/s. Rajah Sir Annamalai Chettiar Foundation Vs. The Director of income-tax (Exemptions)I.T.A.No. 1817/Mds/2010.

Thanks

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