AMERICAN HOTEL & LODGING ASSN.EDUNL.INST vs CENTRAL BOARD OF DIRECT TAXES .

The Supreme Court examined the scope of enquiry by the Prescribed Authority under Section 10(23C)(vi) of the Income Tax Act, 1961, in light of the third proviso inserted by the Finance Act, 1998. The Court held that the Central Board of Direct Taxes (CBDT) acted within its jurisdiction in rejecting the appellant's application for approval, emphasizing that the nature of the institution's activities must align with the educational objectives outlined in the statute. The appeal was dismissed, affirming the Delhi High Court's decision which upheld the CBDT's order.