VYASA VIDYA MANDIRAM,COIMBATORE vs. CIT, EXEMPTIIONS,, CHENNAI

ITA 1286/CHNY/2025Status: DisposedITAT Chennai09 March 202620 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessee's Vedic/Sanskrit courses, conducted with regular classes, a fixed curriculum, attendance criteria, and examinations, amount to 'education' as contemplated under Section 2(15) of the Act. The Tribunal found that charging nominal fees for the upkeep of the educational institute does not alter its charitable character, as eleemosynary is not always a prerequisite for a charitable purpose, and any surplus is reinvested. The Tribunal also held that the non-commencement of certain objects, such as 'relief of the poor' and 'medical relief', is not fatal at the registration stage, especially for a newly established trust. The Tribunal distinguished the reliance on Kasyapa Veda Research Foundation v CIT by noting that the universal appeal of Vedas and their philosophical aspects are not confined to any single religion, and that the assessee also undertook purely charitable activities like relief of the poor and financial assistance for Indian Heritage Education. The Tribunal quashed the CIT(E)'s findings and directed the grant of registration under Section 12AB and approval under Section 80G. No issue was expressly left undecided.

What were the facts?

The assessee, Vyasa Vidya Mandiram, a public charitable trust established on February 11, 2022, with objects including promotion of Samskritam, educational development, public health, environmental awareness, micro credit, minorities welfare, agriculture, and folk arts, filed appeals against the orders dated March 21, 2025, passed by the Commissioner of Income Tax (Exemptions), Chennai. These orders rejected the assessee's applications for regular registration under Section 12AB (filed in Form 10AB under Section 12A(1)(ac)(iii)) and approval under Section 80G of the Income Tax Act, 1961. The assessee had commenced activities from FY 2021-22 (AY 2022-23) and had previously obtained provisional registration under Section 12A(1)(ac)(vi) and provisional approval under Section 80G(5) on March 6, 2023.

What were the issues?

1. Whether the assessee's Vedic/Sanskrit courses, described as unorganized, qualify as 'education' under Section 2(15) of the Income Tax Act, 1961, in light of the judgments in Sole Trustee Lok Shikshana Trust v. CIT and New Noble Educational Society v. CCIT. 2. Whether the assessee's collection of fees and booking them as 'sale of services' constitutes a business activity in the nature of trade or commerce, thereby disqualifying it from being a charitable purpose under Section 2(15). 3. Whether the non-commencement of activities related to 'relief of the poor' and 'medical relief', despite being listed as objects, is fatal to the application for registration and approval. Assessee's Contentions: The assessee argued that its courses are conducted systematically with regular classes, a fixed curriculum, attendance criteria, and examinations, satisfying the definition of education. It contended that charging nominal fees for the upkeep of the institute does not negate its charitable character, citing that eleemosynary is not always required and that any surplus is reinvested. Regarding uncommenced activities, it stated that the trust is new and these may be undertaken in the future. The assessee relied on Delhi High Court judgments in Delhi Music Society v. DGIT and CIT v. NIIT Foundation, and Chennai ITAT decision in Smt. Lingammal Ramaraju Shastra Prathistha Trust v. ACIT(E), and distinguished the New Noble case as being in the context of Section 10(23C)(vi). Revenue's Contentions: The CIT(E) rejected the application on the grounds that the Vedic/Sanskrit courses were unorganized, the fee collection amounted to business, and 'relief of the poor' and 'medical relief' activities were not undertaken. The CIT(E) relied on Sole Trustee Lok Shikshana Trust v. CIT and New Noble Educational Society v. CCIT for the interpretation of 'education' and also cited Kasyapa Veda Research Foundation v CIT to hold that Vedic study is religious instruction.

Which sections of the Income-tax Act were involved?

Section 12A(1)(ac)(iii),Section 12AB,Section 80G,Section 2(15),Section 12A(1)(ac)(vi),Section 80G(5),Section 10(23C)(vi)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI

Before: SHRI MANU KUMAR GIRI & SHRIS.R.RAGHUNATHA

Hearing: 13.01.2026Pronounced: 09.03.2026

PER MANU KUMAR GIRI, Judicial Member:

The captioned appeals are directed against the orders both dated 21.03.2025 passed by the Ld. Commissioner of Income Tax (Exemptions), Chennai [“CIT(E)”] rejecting the application filed by the assessee in Form No. 10AB u/s. 12A(1)(ac)(iii) seeking regular registration u/s. 12AB and application filed in Form No.10AB seeking approval u/s.80G of the Income Tax Act, 1961 (“the Act”).

2.

Brief facts of the case are

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