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The Supreme Court held that educational trust or societies, which seek exemption under Section 10 (23C) of Income Tax Act, should solely be concerned with education, or education related activities. Where the objective of the institution appears to be profit-oriented, such institutions would not
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FAQ :
Educational trusts must have education as their sole objective to claim exemption under Section 10(23C) of the Income Tax Act.
No, if the objective of an educational institution appears to be profit-oriented, it will not be entitled to approval or tax exemption.
Not necessarily. A surplus generated in the course of providing education or educational activities is permissible, provided it's not the primary objective and is incidental to educational pursuits.
The Supreme Court clarified that 'solely' means that all objects of the trust or society must relate to imparting education or be in relation to educational activities, with no unrelated profit-making objectives.
No, the law declared in this judgment will operate only prospectively, meaning it applies to future applications and not to past claims.
Yes, tax authorities can call for audited accounts and other documents to ascertain the genuineness of an institution and its functioning.
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