Registration under Sec 10(23)C

I am working in edudcational organisation and apart from fees collection and we get non-plan grants towards salary support. For the year 2006-07 (A.Y.2007-08). In recent assessment, the A.O has issued notice that the institute has exceeded Rs.100 Lakhs gross receipts and not registered under sec 10(23)c, the institute is liable for tax and to be paid with in 30 days. Please let me know how far A.O. is right. We are registered under 12(A)A