American Hotel & Lodging ... vs Central Board Of Direct Taxes & Ors

The Supreme Court examined the scope of enquiry by the Prescribed Authority under Section 10(23C)(vi) of the Income Tax Act, 1961, in relation to the rejection of a tax exemption application by the CBDT. The Court held that the authority must consider the nature of the institution's activities and its compliance with the statutory requirements for tax exemption. The appeal was dismissed, upholding the CBDT's decision to reject the application for approval, thereby affirming the interpretation of the relevant provisions of the Income Tax Act.