2019 (12) TMI 148 - AT - Income Tax

Exemption u/s 11 - entitled for registration u/sec 12A - imparting training in performing arts like various dance forms including traditional Kuchipudi - HELD THAT - Training and education in performing arts like dance and music are traditionally given by teachers to small groups of students in an informal atmosphere. Training in the above field is usually not given in schools, colleges and institutions having a formal frame. Therefore the attire and choreography of the place of instruction is not the prime thing to be looked into by the assessing authority. Despite the form or the absence of form, what is to be looked into is whether the assessee-trust is in fact imparting training in performing arts like various dance forms including traditional Kuchipudi and granted benefit u/sec. 10(23C)(iiiad). During the course of hearing assessee has submitted that Vempati Chinna Satyam Kuchipudi Art Foundation has already enjoying 12A registration. Thus we find that the assessee is entitled for registration u/sec, 12A of the Act. The Hon'ble Calcutta High Court in the case of CIT Vs. Doon Foundation 1985 (1) TMI 36 - CALCUTTA HIGH COURT wherein it was held that educational institutions need not be affiliated to Universities or Boards and what is to be seen is that the object clause of the trust is for educational purposes and it has carried out a full-fledged teaching of the relevant course . In the case of CIT Vs. Academy of General Education 1983 (8) TMI 18 - KARNATAKA HIGH COURT wherein it was held that an assessee need not necessarily be a school or a college where education is imparted so as to claim exemption under section 10(22). The court held that it would be sufficient if the assessee is an educational institution primarily engaged in educational activities . Hon'ble Madras High Court in the case of CIT Vs. Kshatriya Girls Schools Managing Board 1998 (6) TMI 9 - MADRAS HIGH COURT has held that the term 'institution' is not used in a narrow sense and it is of wide import . Keeping in view we are of the opinion that the assessee is entitled for registration u/sec, 12A of the Act. Accordingly, registration u/sec, 12A is granted. Thus, this appeal filed by the assessee is allowed.

Summary

Issues:
- Rejection of registration u/s 12A and approval u/s 80G for a trust involved in promoting classical dance and music.

Analysis:
1. The trust, established for charitable purposes, applied for registration u/s 12A and approval u/s 80G. The applications were rejected by the CIT(E) citing lack of charitable activity due to collecting fees for dance courses.

2. The appeal argued that the trust promotes classical Indian dance, 'Kuchipudi,' as an educational activity without profit motive. The trust provides education in dance and music without discrimination based on caste, creed, or religion. The curriculum includes basic and advanced levels of dance learning.

3. The ITAT observed that the trust is engaged in promoting classical dance and music, emphasizing the educational aspect of teaching 'Kuchipudi' and other classical music forms. The nominal fees collected are used for the institute's maintenance, not for profit.

4. Referring to the ITAT, Chennai Bench and High Court judgments, the ITAT concluded that the trust is entitled to registration u/s 12A. The judgments emphasized that educational institutions need not be affiliated with universities, and the term 'institution' has a wide import.

5. Consequently, the ITAT allowed the appeal, granting registration u/s 12A to the trust. The order to file a fresh application for approval u/s 80G was set aside, directing consideration based on the granted 12A registration.

6. In summary, the ITAT Hyderabad allowed the appeal for registration u/s 12A for the trust involved in promoting classical dance and music, emphasizing the educational nature of the activities and the nominal fees collected for maintenance purposes. The judgment highlighted the importance of educational activities for trusts seeking registration and approval under relevant sections of the Income Tax Act.