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TMI Blog2023 (1) TMI 265X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellant trust for the relevant assessment years. In this case, the appellant trust is running a coaching/tuition centre under the name and style of Shiksha in various places. The assessee claims that conducting coaching classes comes under the term education as defined u/s. 2(15) of the Act. We do not find merit in the argument of assessee, because the term education has been defined by the Hon ble Supreme Court in the case of Sole Trustee, Loka Shikshana Trust [ 1975 (8) TMI 1 - SUPREME COURT] where it has been explained the term education as defined u/s. 2(15) of the Act and as per Hon ble Supreme Court, it is the systematic instruction, schooling or training given to the young in preparation for the work of life and further, when education connotes in that clause is the process of training and developing the knowledge, skill, mind and character and students by normal schooling. This legal position has been affirmed by the Hon ble Supreme Court in the case of New Noble Educational Society vs Chief Commissioner of Income-tax, [ 2022 (10) TMI 855 - SUPREME COURT] where it has been affirmed the definition of education as held in Sole Trustee, Loka Shikshana Trust vs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e three appeals filed by the assessee are directed against separate, but identical orders of Commissioner of Income-tax (Appeals), dated 30.05.2019 01.04.2019 and pertains to assessment years 2011-12, 2012-13 2013-14. Since, the facts are identical and issues are common, for the sake of convenience, these appeals were heard together and are being disposed of by this consolidated order. 2. The assessee has raised common grounds of appeal for all the assessment years. Therefore, for the sake of brevity grounds of appeal filed for assessment year 2011-12 are reproduced as under: 1. The order of the learned CIT (Appeals) - 10 is contrary to the facts of the case and is therefore unsustainable. 2. The learned CIT(Appeals) - 10 ought not to have held that the tuition centres run by the Trust are hit be the provisions of section 2(15) of the Income Tax Act 1961 and ought not to have rejected the appellant Trust's plea that they would come under the term education and would qualify for deduction as application of income. 3. The learned CIT(A)-10 ought to have further appreciated the fact that the term education would include tuition centres or coaching centres a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5) of the Act, rejected exemption claimed u/s. 11 12 of the Act and assessed total income as AOP and determined income of Rs. 21,13,615/-. The relevant findings of the AO are as under: Without prejudice to the above authorised representative of the assessee was asked to justify as to how the running of tuition centres is a charitable activity in the wake of amended provso to section 2(15) in the definition of charitable purpose 18. The tuition centres run by the Trust are meant for the children of the women belonging to low income groups. These children typically study in government schools where there is no individual attention. They also suffer from lack of facilities at their homes, studies and score better marks. The registration fees of Rs. 50/- and tuition fees of Rs. 100/- to Rs. 300/- a quite nominal compares to rates charges by tuition masters for higher income groups. The activity is charitable in nature aimed at benefitting children from lower income group families. It may also be seen from the Accounts that against the income of Rs. 49.84 lakhs from registration, tuition and training fees for the year, the expenditure on teachers salary and fees alone exceed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. Assessee sought to explain the same as follows : 25. At the time of putting up some of the Shiksha Centres the Trust did not have funds in order to pay the contractors in such cases, the bills were paid by the company and in turn debited to the Trust. These are assets used by the Trust for its Shiksha centres only and no benefit has accrued to the company, It is submitted that these are bonafide application of income of the Trust only. 26. Premises at Erode: the agreement is in the nature of Equitas Development Initiatives Trust. With regard to depreciation, since the entire capital expenditure incurred had been allowed as application of income in the past, the same is added back however since the business profits of the society enforce an altered from of taxation and when sec.11 12 become inapplicable, the assessee is treated like a business enterprise in the status of AOP. therefore, the depreciation allowance of Rs.36,330/- relating to assets acquired during the year under consideration is provided to the assessee and allowed as expenditure. The taxation of income is not confined to the income derived from sale of micro chips and service for issues ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be poor are furnished. Since the AR failed to establish that education was provided to poor students at nominal cost, the assessee trust cannot be categorized as one falling under the clause relief of the poor . 5.3.12 The AR also argued that the appellant trust falls under the category of charitable purpose of education and relied upon two judgements as cited above. I have carefully considered the submissions of the appellant and am unable to agree with the contentions of the appellant since coaching of students does not amount to providing 'education' as is envisaged under the charitable purpose provided u/s. 2(15) of the Act. It is to further state \ that the Hon'ble Supreme Court in the case of Sole Trustee, Loka Shikshana Trust vs Commissioner Of Income Tax, 101 ITR 234had held that every activity of obtaining knowledge cannot fall under the charitable purpose of education. It was held therein that the sense in which the word education has been used in section 2(15) is the systematic instruction, schooling or training given to the young in preparation for the work of life and further clarified that what education connotes in that clause is the process of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee for three assessment years and also certain admission forms issued by the tuition centre at various branches submitted that, the assessee has conducted tuition classes for poor students who are mainly son and daughter of daily wage workers and other unskilled workers. The assessee is charging a nominal tuition fee of Rs. 100/- to Rs. 150/- per month which is very nominal when compared to tuition fees charged by other coaching centers. Further, if you go through the income and expenditure account of the trust, the trust has incurred expenses which is over and above the amount of fees collected from tuition centers. Therefore, he submitted that the trust is conducting tuition classes mainly to provide relief to the poor and thus, the Ld. CIT(A) has erred in holding that the activities of the assessee trust which are in the nature of general public utility and provisions of section 2(15) of the Act is applicable. 6. The Ld. DR, supporting the order of the ld. CIT(A) submitted that the objects and activities of the assessee are neither in the nature of education nor comes under the definition of relief to the poor, but in the nature of any other objects of general public u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing and developing the knowledge, skill, mind and character and students by normal schooling. This legal position has been affirmed by the Hon ble Supreme Court in the case of New Noble Educational Society vs Chief Commissioner of Income-tax, (2002) CA No. 3795/2014 judgment dated 19.10.2022, where it has been affirmed the definition of education as held in Sole Trustee, Loka Shikshana Trust vs CIT, (supra). In other words, the term education only includes a formal school education which provides education in the field of knowledge, skill and character of students to prepare for the work of life. Therefore, in our considered view, running tuition centres does not come under the definition of education as defined u/s. 2(15) of the Act, and this view is affirmed by the decision of Hon ble Patna High Court in the case of Bihar Institute of Mining and Mine Surveying vs CIT, 208 ITR 608 . 8. Having said so, let us come back to the arguments of the counsel for the assessee that the objects and activities of the trust is in the nature of relief of the poor as defined u/s. 2(15) of the Act. 'Relief of the poor' encompasses a wide range of objects for the welfare of the economica ..... X X X X Extracts X X X X X X X X Extracts X X X X
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