TMI Blog2016 (10) TMI 985X X X X Extracts X X X X X X X X Extracts X X X X ..... . We have also already held that the courses and programs actually run by the aforesaid units of the appellant trust are to be regarded as “education”. Thus, the activities of the appellant trust are genuine. We have also found that Ld. DIT(E) has failed to bring out relevant and adequate materials on the basis of which it can be reasonably held that the activities of the appellant trust were not genuine. Further, we have also noticed that on identical facts the activities of the aforesaid educational units of the appellant trust were treated as “education” when these units were being run under R.K. Convent School Educational Society before transfer to the appellant trust who was granted registration u/s 12AA on the strength of educational activities since many years including the educational activities of the aforesaid educational units transferred subsequently to the appellant trust. Thus Ld. DIT(E) failed to make out a case for rejection of registration u/s 12AA / 12A of I.T. Act. Therefore, we direct Ld. DIT(E) to grant registration u/s 12AA/12A - Decided in favour of assessee - ITA No.:- 3748/Del/2014 - - - Dated:- 26-8-2016 - SHRI KULDIP SINGH, JUDICIAL MEMBER AND SHRI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal are taken up together. The appellant trust was created by way of trust deed on 18th March, 2013 by Mr. Deepak Bansal. There are four trustees of the appel lant trust namely Mr. R.K. Goel, Mr. Gagan Gautam, Mr. Sanjay Agarwal, Mrs. Neha Bansal. The corpus of the appellant trust, totalling ₹ 95,000/- consists of ₹ 11,000/- received from each of the four trustees and ₹ 51,000/- received from Mr. Deepak Bansal, author of the trust on different dates. The appellant trust appl ied for registration u/s 12AA/ 12A of I.T. Act vide appl ication dated 18.10.2013. The Ld. DIT(E) called for certain information on 17 different points vide letter dated 28.10.2013 (page 11 of paper book filed by the appellant). The appellant submitted reply vide letter dated 18.11.2013 (pages 12 to 18 of paper book submitted by appellant). Further details were also submitted by the appellant vide letters dated 3.2.2014 (pages 19 to 24 of paper book submitted by appellant) and letter dated 12.2.2104 (pages 25 to 29 of paper book submitted by appellant). Ld. DIT(E) vide impugned order dated 30.4.2014 rejected the application filed by the appellant trust for grant of registration u/s 12AA / 12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the proposed Educational Trust to be authorized by Sh. Deepak Bansal, are the same and if the society can legally transfer its assets of the unit to the said newly created Educational Trust of Shri Deepak Bansal, then believing the credibility of Sh. Deepak Bansal to responsively run the unit in future with the same name and with a view to shred the responsibilities of existing already established units to enable the society to concentrate on future expansions, the proposed offer of Sh. Deepak Bansal be accepted and modalities of the assets transfer be worked out and be written through a Memorandum of Understanding. Rather the affair and Assets of the other unit of the society at New Delhi i.e. R. K. College of Systems Management, at Punjabi Bagh, be also wasted with the proposed Educational Trust of Shri Deepak Bansal, if so mutually agreed That the chairman the President of the Society Sh. N. C. Bansal be and is hereby authorized to finalize the Memorandum of Understanding with the proposed Educational Trust of Shri Deepak Bansal after its due registration to give effect to the mutually agreed terms. 5.2 It is thus clear that the trust has actually been created ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egard from the competent authority. Thus the Ld. DIT(E) held that a trust (the appellant) which was running its activities out of an illegal / unauthorised arrangement (with R.K. Convent School Education Society) cannot be held to be carrying out genuine activities. iv) The Ld. DIT (E) observed that the courses run by the trust (the appellant) are neither recognised nor a part of regular curriculum of any university / education programme; and further, that these were just skill development / enhancement courses / programme which cannot be termed as education. The Ld. DIT(E) made a reference to the decision of Hon ble Supreme Court in the case of Sole Trustee Lok Shikshana Trust vs. Commissioner of Income Tax (1975) 10 ITR 234 (SC) and quoted the following from this decision: The sense in which the word education has been used in section 2(15) is the systematic instruction, schooling or training given to young in preparation for the work of life. It also connotes the whole course of scholastic instruction which a person has received. The word education has not been used in that wide and extended sense according to which every acquisition of further knowledge constitutes e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ridwar ITA No. 387/Del/2013 B Bench order dated 27.8.2013 and Sivananda Yoga Vedanta Natraj Society vs. ITO(E) ITA No. 311/Del/2015 order dated 29.7.2015. Ld. DR, however strongly supported the order of the Ld. DIT(E) and relied on the order passed by Ld. DIT(E). 4. Facts of the case are not in dispute. The objects for which the appellant trust was founded are stated in clause 3 of the trust deed (pages 4 5 of paper book filed by appellant). Besides other objects, the objects of the appellant trust include, to establish, maintain, support and run schools, colleges, social service centres, industrial training centres, skill development centres, coaching institutes, boarding houses, day shelters, research and training centres and other institutions of education, having objects similar to those of this trust for imparting elementary and higher education, technical, industrial or commercial knowledge or training amongst public. R.K. Education Trust (the appellant) has been formed by Mr. Deepak Bansal, son of Mr. N.C. Bansal (President of R.K. Convent School Education Society). R.K. Convent School Education Society was running its educational activities through, inter-alia, educati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i and Shyam Lal College. Our aforesaid educational activity is classified as charitable within the meaning of section 2(15) of the Act . 5. A careful perusal of sections 12A/12AA of I.T. Act shows that the relevant factors to be considered at the time of registering the applicant u/s 12AA/12A of I.T. Act are, objects of the appl icant, and genuineness of its activities. The Ld. DIT(E), in her impugned order, has given her opinion on both these factors. As far as the objects of the appellant trust are concerned the Ld. DIT(E) has held that it cannot be termed as education . As far as genuineness of the activities of the appellant trust is concerned the Ld. DIT(E) has held that the activities are not genuine. We take up both these aspects one by one. 6. As to whether the objects of the appellant trust can be termed as education , we find that the educational units taken over by the appellant trust were earlier being run by R K. Convent School Education Society. The Ld. DIT(E) has observed in para 3 of her order that R.K. Convent School Education Society was running its educational activities (emphasis added) through colleges / institutes which included the educational uni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... If you visit a night club, you get acquainted with and add to your knowledge about some of the not much revealed realities and mysteries of life. All this in a way is education in the great school of life. But that is not the senses in which the word education is used in clause (15) of section 2. What education connotes in that clause is the process of training and developing the knowledge, skill, mind and character of student by normal schooling. 6.1. On careful reading, it is obvious that what the Hon ble Supreme Court disapproved, was exaggerated and farfetched interpretation of the word education . If the ratio of the decision of Hon ble Supreme Court is correctly understood, Hon ble Apex Court has actually approved the interpretation of the word education in the sense of systematic instruction, schooling or training and in the sense of scholastic instruction which a person has received. In the case of the appellant trust, we find that it is providing professional education and training through courses of varying duration in the fields of mass communication, journalism, acting, radio jockey, news reading and anchoring, advertising and public relations etc. through th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .T. Act under which charitable purpose is defined. In a case decided by Hon ble Jurisdictional High Court in the case of Delhi Music Society v. Director General of Income-tax (2012) 17 Taxmann. Com 49/204 Taxman 231/(2013) 357 ITR 265 (Delhi) the Hon ble High Court held that where any school or educational institution is being run in a systematic manner with regular classes, vacations, attendance requirements, enforcement of discipline and so on; it meets the requirement of an educational institution. The appellant s reliance on Delhi ITAT decision in the case of Shivanand Yog Vedant Natraj Society v ITO (supra), copy whereof has been filed by the appellant trust, in which the Hon ble ITAT considered the decision of Delhi ITAT in the case of Divya Yog Mandir Trust (supra) is also relevant, wherein also Delhi Bench of ITAT has held that imparting of yoga training fell under the category of imparting education which is one of the charitable objects defined u/s 2 (15) of I.T. Act. 7. A combined reading of the judicial precedents in Sole Trustee, Lok Shikshna Trust vs. CIT (supra) ; Divya Yog Mandir Trust vs. Jt. CIT (supra), Delhi Music Society vs. Director General of Income Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d order that it (R.K. Convent School Education Society) was not authorised to run the courses under its banner without having necessary permission / affil iation in this regard from the competent authority ; this is quite contrary to her own finding in paragraph 5.2 of her impugned order, where she herself has noted that these courses were being successful ly run by R.K. Convent School Educational Society before being taken over by the appellant trust. She has also noted in paragraph 4.3 of her impugned order that details regarding nature of courses run by appel lant trust and about association with University of Delhi and Shyam Lal College were furnished. Be that as if may. There is no statutory requirement for the purpose of granting registration u/s 12AA / 12A of I.T. Act, that educational courses or programmes must be run in affiliation with a college or a university. Whether the educational courses or programmes being run by an applicant are recognised by or are in affil iation with a college / a university / a government authority is irrelant for the purpose of section 12AA / 12A of I.T. Act. 9. It is settled law that when two reasonable views are possible, the view favour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... School Educational Society and that assets and affairs of the aforesaid two educational units were transferred to the appellant trust, especially as there is no finding by Ld. DIT(E) that the transfer of assets was not voluntary. Also it is of no relevance that author of the appellant trust, Mr. Deepak Bansal is son of Mr. M.C. Bansal, President of R.K. Convent School Education Society and was engaged in running of the aforesaid educational units under R.K. Convent School Educational Society. The observation of Ld. DIT(E) that the transfer of assets of R.K. Convent School Education Society to the appellant trust was in the nature of division of assets of a family is ill founded in the absence of any comprehensive discussion on what were the total assets of the family and how these assets were distributed amongst different members of the family. Merely because some assets and activities were transferred from R.K. Convent School Education Society to appellant trust, it cannot be said that the transfer amounted to transfer of family assets even if President of transferor society and author of appellant trust are close relatives. It is a settled principle that in certain situations au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d approach mustbe disapproved. The partisan approach of authorities to be guided merely by what is in the interest of Revenue may cause unnecessary hardships to persons and must be avoided. In general, in coming to conclusions and in taking decisions ; authorities concerned must also be guided by what is in the interest of justice and not merely by what is in the interest of Revenue. In the facts and circumstances of a case, questions of fact and questions of law and mixed questions of law and fact must be decided by authorities based on what, in accordance with law ; is just, fair, reasonable , proper, etc. in the facts of the case ; and not merely by what is in the interest of Revenue. Thus not only the Ld. DIT(E) has based her conclusions on incomplete facts, but also has rel ied on partisan / inadequate / irrelevant considerations. What was relevant was to see whether the objects of the appellant trust were in the nature of charitable purposes and whether the activities of the appellant trust were genuine. Ld. DIT(E) has failed to bring out relevant and adequate materials on the basis of which it can be reasonably held that the activities of the appellant trust were not genuine ..... X X X X Extracts X X X X X X X X Extracts X X X X
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