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ITA-54-2020 (O 101
IN TH COMMISSIN M/S UNIQUE CORAM: H
H Present: M
f SANJEEV P
CM-13193-CI
A appellant to p
R CM-13886-CI
A officer in-char Main case 1. Counse 2. This is the ITA
O&M) Page 1 of 8 HE HIGH COURT OF PUNJA CHANDIGAR
NER OF INCOME TAX (EXEM Vs.
E EDUCATIONAL SOCIETY **** HON’BLE MR. JUSTICE SAN HON’BLE MR. JUSTICE SAN **** Mr. Varun Issar, Sr. Standing Co for the appellant/Revenue. **** RAKASH SHARMA, J.(Oral) II-2024 Application under section 51 o lace on record documents Annex Application is allowed and the do Registry to place the same at app II-2024 Application filed by the appella rge concerned is dismissed. el for the appellant was heard on an appeal preferred by the Reve AT dated 06.08.2019 whereby AB AND HARYANA AT RH ITA-54-2020 (O&M) Date of Decision: 17.09.2024 MPTIONS), CHANDIGARH . . . . Appellant . . . . Respondents NJEEV PRAKASH SHARMA NJAY VASHISTH ounsel ) of CPC has been filed by the xure A-1 to A-3. ocuments are taken on record. propriate place. ant for waiving the cost on the merits. enue against the order passed by the appeal of the respondent-
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ITA-54-2020 (O Unique order p under s 1961 vi 3. The res was run training by Nati 4. The app of know does no case of Income
I the wid would involve 5. The sec partake from th purpose corrobo by the s
O&M) Page 2 of 8 e Educational Society (appellant passed by the CIT(E) refusing to section 12A read with section ide its order dated 30.06.2018 w spondent-Society had applied f nning a private Industrial Trainin g to the students, and the same w ional Council for Vocational Tra plication was rejected by the CI wledge or skill does not qualif ot come within the four corners f Sole Trustee Loka Shikshan e Tax (101 ITR 234). It further observed that ‘educati de and extended sense, and acq not constitute education. Mer e systematic education. cond ground for rejection was th the character of voluntary don he property cannot be said to be e. The contributions towards orated. The third objection was wi society alleged to be meant for pe t therein) was allowed, and the o register the respondent-Society 12AA of the Income Tax Act, as set aside. for registration pleading that it ng Institute imparting vocational was duly affiliated and regulated aining (NCVT). IT(E) on the ground that gaining fy for the label ‘education’ and s of education as defined in the na Turst vs. Commissioner Of on’ would not be considered in quiring of technical knowledge re skill enhancement does not that the assessee-Society did not ations, and the income received vested in the trust for charitable corpus fund had not been ith regard to purchase of two cars ersonal use of the members of the
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ITA-54-2020 (O society, utilizati 6. The Tr providin general of India affiliatio instituti Private one. Th for esta and sty granted 7. After b the CIT Act. 8. Learned Govern Skill De of the t reimbur Vikas impartin the Cen
O&M) Page 3 of 8 , and they could not be said to be ion of the funds was not for charit ibunal rejected the contentions a ng computer operator programm course and electrician course. It f a, Ministry of Labour and Emplo on upon recommendations of t ions which have been approved, ITI, district Yamunanagar run by he Government of Haryana has a ablishment of the private Industr yle of ‘Mahatma Gandhi Indus d affiliation from the State Counci being convinced, the Tribunal pro T(E) to register the society unde d counsel for the appellant w nment reimburses the amount to evelopment programme, and an a total receipts of Rs.93,06,599.50 rsed towards the training fees un Yojana. The affidavit therefor ng training for implementation o ntral Government. e of benefit of general public, and table purposes. and found that the institute was ming course, fitter course, painter found that as per the Government oyment, the Committee approved the NCVT. In the list of such , the name of Mahatma Gandhi y the society is placed at number also given approval to the society rial Training Centre in the name strial Training Centre’, and has l for Vocational Training. oceeded to pass orders directing r Section 12A and 12AA of the was asked as to whether the the respondent-society under the ffidavit has been filed stating that 0/-, amount of Rs.9,51,500/- was nder the Pradhan Mantri Kaushal re reflects that the institute is of one of the welfare schemes of
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ITA-54-2020 (O 9. Learned and the Section passed Kottaya 10. We hav 11. For ca Tribuna M D B fo h sy a c 1 b a d v th a p p fo th m g
O&M) Page 4 of 8 d counsel has contended that trai e ITAT has erred in directing the n 12A and 12AA of the Act. He by the Kerala High Court in am vs. M/s Annadan Trust, [2018] ve considered the submissions. arrying out educational activitie al has observed as under: “4. Further, as per letter d Ministry of Skill Development & Delhi, the appellant has been em Body under Modular Employable for the assessee, therefore, has subm has been running the vocational systematic manner and is affiliated as well as SCVT, Haryana. That conducted on national level and 10+2 degree is awarded by the NC by the appellant being for promoti and training, class rooms teach designed for generation of employ village youths and the same have b he state government as well as C are convinced that the vocationa programme run by the appellant programme imparting class room focus on employment generation. he appellant, in our view, can saf mode of systematic instructions / given to the young in preparation f ining is not a systematic training registration of the society under has also relied on the judgment Commissioner of Income Tax, ] 258 Taxman 54 (Kerala). es and charitable activities, the dated 23.12.2016 of the Entrepreneurship, New mpaneled as Assessing Skills. The Ld. Counsel mitted that the appellant l training course in a and regulated by NCVT t the examinations are Diploma equivalent to VT. That the courses run ion of skill development hing and trainings are yment opportunities for been duly recognized by Central Government. We al educational training society are systematic m as well training with The education given by fely be said to be in the / schooling or training for the work of life and,
g r t
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ITA-54-2020 (O in te in th h w th r c s o th o c m c is th th to w r a fr r th c c a 12. The K (supra)
O&M) Page 5 of 8 n our view, duly fall within the pu erm 'Education' as used in section 5. So far as the observation ncome of the assessee is not from hat the same cannot be said to b held under the trust is concerned, with the above observation of the L he claim of the appellant trust. reimbursed the amount spent by carrying out its 'education / trainin skill development programme of th our view, it can be safely said to be he activity of the appellant trust a observed above, falls within the charitable purpose. It is not be cas major or main activity of the app commerce or business. The receipt s in the course of carrying out of he assessee. 6. The third objection raise hat the appellant could not co owards the corpus funds from th with bank entries. In our view, thi rejection of the application u/s appellant has shown the receipts to from the members of the trust and recorded in the books of account. I he receipts were received in cas channel. Moreover, whether the corpus funds or for application is t assessment.” Kerala High Court in Commissi has held as under: urview and scope of the 2(15) of the Act. n of the CIT(E) that the m voluntary donation or e income from property d, we are not convinced Ld. CIT(E) for rejecting The appellant trust is y the Government for ng programme as per the he Government. Thus, in e income generated from and the said activity as purview and scope of se of the CIT(E) that the pellant trust is towards t of income, in our view, f 'Educational activity of ed by the Ld. CIT(E) is orroborate the receipts he members of the trust is cannot be ground for 12A of the Act. The owards its corpus funds the same has been duly It makes no difference if sh or through banking receipts are towards to be seen at the time of ioner of Income Tax, Kottayam
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ITA-54-2020 (O in s th n th in in c a in im s th S is 1 th b b s th w w a a th a w o G w
O&M) Page 6 of 8 “6……… However, when a p n the above case, is involved in im schemes of the Government, we ca hat. The mere assertion that there not suffice especially when for imp he assessee takes money from the S ntermediary. The further contentio n the deficit of other program i claiming business expenditure, but as a charitable institution. 7. In deciding the issue, it is ntermediary institution, has p mplementation of the Schemes. such Schemes would not lead to an he respondent-assessee entitlin Section 12AA. The transaction as a s not one which would enable reg 12AA. The proceedings were initia he report of the AO that the obje been departed from and the as business as sub-contractor, imp schemes of various State Governm he poor school children. It was a was net profit earned from the sub were accumulated to the Trust fund activity being carried on. The asses any evidence as to a charitable a han asserting that from its incep assessee was of feeding the poor was, as an implementing agency of on funds earmarked and disb Government. There is no charity welfare schemes of the Governmen particular institution, as mplementation of welfare annot find any charity in e is no profit motive will plementing the schemes State Government or the n that surplus is applied is a perfect ground for not to get a registration s very pertinent that the paid money for the The implementation of ny charitable activity by ng registration under admitted by the assessee gistration under Section ated for cancellation, on ectives of the Trust has ssessee is carrying on plementing the welfare ments, supplying food to also reported that there b-contract; which funds d, without any charitable ssee also did not proffer activity carried on other ption the activity of the r. However this activity f the State Governments, bursed by the State y in implementation of nt, with the funds of the
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ITA-54-2020 (O S d S th s 13. The S Commi as unde a o 0 in S e g c g o n r s c ( c d 2 c la
O&M) Page 7 of 8 State. Charity of the right hand, disclosed to the left hand. Here, the State implemented with State funds he implementing agency, who rec such implementation.” upreme Court in New Noble issioner of Income-Tax and anot er: “16. While answering que and 4 (supra), we find that essentia order passed by the CIT cancell 02.03.2010 to be without jurisdictio n law. It has stated so as the am Section 12AA(3) of the Act by th empowering the Commissioner to granted under Section 12A of the A conclusion that the activities of genuine and not being carried out objects of the trust or institution. Th not available as on the day when registration i.e. on 02.03.2010. 17. XXXX XXXX 18. Thus, we find that similar to the facts of the present c case Industrial Infrastructure De (Gwalior) M.P. Limited’s case (supr cancelled the registration under S dated 13.04.1991 by its order da 29.04.2002 the Commissioner w cancel such registration. In view t aw no. 1, 3 and 4 are answered in it is said, shall not be e welfare measure of the is claimed as charity by ceives consideration for Educational Society vs Chief ther;(2022) 448 ITR 594 has held estions of law nos. 1, 3 lly the ITAT has held the ling the registration on on and without authority mendment was made in he Finance Act of 2010 cancel the registration Act where it reaches to a the such trust are not t in accordance with the he power was, therefore, n the CIT cancelled the the facts were almost case as in the aforesaid evelopment Corporation ra), the Commission had Section 12A of the Act ated 29.04.2002 and on was not empowered to thereof, the questions of n favour of the assessee
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ITA-54-2020 (O o G 14. In view be appl accepte vocation develop Vocatio other fi Vocatio systema approve impartin 15. In view above, n be with 16. All pen
September 17 Mohit goyal 1. Whethe 2. Whethe
O&M) Page 8 of 8 on the basis of judgment in Comm Gwalior (supra).” w of above, the law as laid down b lied and the view expressed by t ed to be the correct interpretation nal education is a form of educ pment of an individual for the onal training has been now recog eld of education, and it is for this onal Training has been establishe atic pattern of providing educa ed by the NCVT, it cannot be ng education. w of the specific findings of fact a no interference of this Court is w out merits and the same is accord nding applications also stand disp
(SANJ , 2024 r speaking/reasoned?
Y r reportable?
Y missioner of Income-Tax, by the Supreme Court requires to the Kerala High Court cannot be n. We are also of firm view that ation which is necessary for the purpose of earning his living. gnized to be as important as any s reason that National Council for ed to streamline and lay down a ation. As the institute is duly e said that the institute is not arrived at by the ITAT as noticed warranted. Appeal is thus found to dingly dismissed. posed of. JEEV PRAKASH SHARMA) JUDGE
(SANJAY VASHISTH) JUDGE Yes/No Yes/No
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