DEPUTY COMMISSIONER OF INCOME TAX, NEW DELHI V. RITNAND BALVED EDUCATION FOUNDATION, NEW DELHI

ITA 142/DEL/2024

AI Insights

The case involves the Ritnand Balved Education Foundation, which provides educational services and training programs, and the Revenue's challenge to the tax exemption status of the income derived from these training programs. The Foundation argued that these activities are part of its educational mandate and should be exempt under Section 11 of the Income Tax Act, 1961. The Assessing Officer (AO) had treated these receipts as business income, but the CIT(A) reversed this decision, leading to the Revenue's appeal to the Tribunal. The Tribunal upheld the CIT(A)'s decision, emphasizing the educational nature of the activities and the inconsistency in the Revenue's application of tax laws across different assessment years.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 37109 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2015-2016
• Other Referred Cases: Sole Trustee, Loka Shikshana Trust v. CIT [1975] 101 ITR 234, Commissioner of Income-tax v. Mehta Charitable Prajnalay Trust [2012] 28 taxmann.com 73 (Delhi), Delhi Music Society vs Director General of Income Tax [2012] 17 taxmann.com 49, 357 ITR 265, Bihar Institute of Mining & Mine Surveying vs. CIT [1994] 208 ITR 608, Institute of Chartered Accountants of India [2013] 35 taxmann.com 140 (Delhi), Radiological & Imaging Association vs DDIT (Exemption), Ahmedabad [2018] (3) TMI 1760 (ITAT, Ahmedabad), Vadodara Chamber of Commerce and Industry vs ACIT, Circle-2(2), Baroda, 2019 (5) TMI 620 (ITAT, Ahmedabad), M/s. Ambuja Cement Ltd., Mumbai vs ITO(TDS), Solan (HP) ITA No.648 & 649/Chd/2014 (ITAT, Chandigarh)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANU KRISHNA AGARWAL
• Assessee Lawyers: VED JAIN; UMA UPADHYAY
• Keywords: Business income; Rule of consistency; TDS; Competent authority; Charitable institution; Benefit of exemption
• Section: 143(3); 143(2); 195; 250; 11; 208; 22; 12A; 13; 73; 194C; 10(23C); 194J; 80G; 20; 101

Judgement Text

"ITA Nos.141 & 142/Del/2024 Page | 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “F” BENCH: NEW DELHI BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI VIMAL KUMAR, JUDICIAL MEMBER ITA Nos.141 & 142/Del/2024 [Assessment Years : 2014-15 & 2015-16] DCIT(E) Circle-2(1) New Delhi vs Ritnand Balved Education Foundation, E-27, Defence Colony New Delhi-110024 PAN-AAATR7314Q APPELLANT RESPONDENT Appellant by Ms. Anu Krishna Agarwal, CIT DR Respondent by Shri Ved Jain, Adv. & Ms. Uma Upadhyay, CA Date of Hearing 18.12.2024 Date of Pronouncement 12.03.2025 ORDER PER PRADIP KUMAR KEDIA, AM : The captioned appeals arise from the respective orders of the Commissioner of Income Tax (A), National Faceless Appeal Centre (NFAC), Delhi [“CIT(A)”] dated 14.11.2023 & 16.11.2023 passed under s. 250 of the Income Tax Act, 1961 [“the Act”] emanating from respective assessment orders dated 29.12.2016 & 19.12.2017 passed under s. 143(3) of the Act passed by the Assessing Officer (AO) for the Assessment Years 2014-15 & 2015-16 respectively. 2. The issued involved in captioned appeals are similar and therefore, both the captioned appeals are disposed off by this common order. ITA No.141/Del/2024 [AY 2014-15] 3. The Grounds of Appeal raised by the Revenue read as under:- ITA Nos.141 & 142/Del/2024 Page | 2 1. “Whether, on the facts and circumstances of the case, the Ld.CIT(A) has erred both on facts and in law in allowing the appeal of the assessee as discussed below. 2. Whether, the Ld.CIT(A) was justified in deleting the whole addition amounting to Rs. 10,19,97,202/-ignoring the fact that the services rendered by the assessee to corporate houses were not in the nature of any education or training and was not incidental to the attainment of the objectives of the trust and clearly falls in the ambit of section 11 (4A) of the Act and should be taxed as income from business and profession. 3. Whether, the Ld.CIT(A) was justified in allowing the appeal of the assessee stating that the assessment order passed by the AO is in violation of principle of consistency on the basis that for AY 2012-13 and 2013-14, the AO had not doubted the training provided to corporate houses and duly considered the same within the definition of education for the purposes of section 11(4A) and 2(15) of the Act, disregarding the very fact that every assessment is a fresh proceeding and principle of consistency does not summarily apply to an order/ addition which is based on substantiated facts and reasons. 4. Whether the Ld. CIT(A) was justified in assuming that the activity of training would fall within the category of education ignoring the facts of the case considering various case-laws in favour of the revenue such as Hon'ble Supreme Court's decision in the case of Sole Trustee, Loka Shikshana Trust v. CIT [1975] 101 ITR 234, decision of Hon'ble High Court of Delhi in Commissioner of Income-tax v. Mehta Charitable Prajnalay Trust [2012] 28 taxmann.com 73 (Delhi), and Hon'ble Delhi High Court's decision in the case of Delhi Music Society, which was also referred by the AO in detail in the assessment order. 5. Whether the Ld. CIT(A) was justified intaking a view that the services rendered by the assessee are within the objects of the trust ignoring the fact that none of the objects included imparting professional services to the commercial organizations and that in view of this, the assessee had violated the provisions of the Trust Deed itself. 6. Whether the Ld. CIT(A) was justified in assuming that the training provided by the assessee to corporate houses is in the nature of \"educational\" in accordance with its objects ignoring the fact that the assessee had itself allowed the corporates to deduct the TDS u/s 194] or 1940 assuming that it was paying for professional services rendered by the assessee and at the same time, the assessee too itself had charged service tax on the receipts, which clearly points to the fact that assessee itself was treating the above payment as some kind of commercial services being provided.” ITA Nos.141 & 142/Del/2024 Page | 3 4. Briefly stated, the assessee is a Society registered under Society Registration Act, 1860 and is also registered under s. 12A of the Act. The assessee’s Society [Trust/ Institution/Foundation as may be called] is also notified under s. 80G(5)(vi) of the Act. The aims and objects for which the assessee’s society was constituted are:- (a) “To establish education institutions of all descriptions, including public school, polytechnics, vocational and management training institution, colleges, research institutes, centers for instruction and diffusion of useful knowledge. Issue of any diplomas, certificates etc. shall be made only after the approval of the competent authority, wherever applicable. (b) To award stipends, scholarships and other financial facilities (refundable and/or non-refundable to students, teachers and research scholars for studies in India Institutions and/or in foreign countries. (c) To hold seminars, arrange lectures, conference, debates, exhibitions and the like for the dissemination of knowledge and advancement of education. (d) To adopt and implement measures to promote intellectual physical, moral and social welfare of students and teachers of educational institutions and to supervise and improve the conditions of their residence, health and discipline. (e) To carry out research in all aspects of education including applied sciences. (f) To take over and administer any institution or center, carrying on her intending to carry on any of the objects of the society. (g) To do all such acts, deeds and things as may be conducive to the furtherance of any of the above objects or incidental thereto. All the income, earnings, and moveable and/ or immoveable properties of the Society shall be solely utilized and applied towards the promotion of its aims and objects as set forth in this Memorandum of Association and no portion thereof shall be paid of transferred, directly or indirectly by way of dividends, bonus, profit or in any manner whatsoever to the present or past members of the Society or to any person or persons claiming through any or more of the present or past member. No member of the Society shall have any personal claim on any moveable and/or immoveable properties of the Society or make any profit, whatsoever, by virtue of his/her membership. (h) The Registered Society of the School will be renewed from time to time. ITA Nos.141 & 142/Del/2024 Page | 4 (i) The School established in U.P. shall reserve at least 10% seats for meritorious students of Scheduled Castes/Scheduled Tribes and shall not charge more fee than is prescribed for the school of U.P. Board of Secondary Education/Board of Basic Educations. (j) The School/Institution established in U.P. shall not ask any grant from the State Government. If the school is recognized previously by the Board of Secondary Education and gets affiliated to the C.B.SE.A.C.SE., the previous recognition and grants from the State Government shall cease to exist with immediate effect.” 5. The assessee society is duly registered under s. 12A and notified under s. 80G of the Act. For AY 2014-15 under consideration, the Assessee Society filed return of income on 28.03.2015 declaring NIL income alongwith Audit Report dated 29.09.2014 (after claiming exemption under s. 11 of the Act). As per its memorandum, the Assessee Society is engaged in providing education through various Institutes, Schools, Colleges etc. by the name of AMITY University. The assessee also runs Education Institutes and Universities under AMITY University Uttar Pradesh Act, 2005 (‘Amity Act’). The assessee claims that the assessee is a Society constituted for charitable purposes as defined under s. 2(15) of the Act. 5.1. The Return of Income (ROI) filed by the assessee was subjected to regular assessment by issuing notice under s. 143(2) of the Act. The AO inter-alia observed that the Assessee Society has inter alia earned/ received ‘Training and Development Fee’ to the tune of INR 16,55,27,212/- towards corporate training, sill development programmes and workshops organised by the assessee which are separable from the core educational activities. 5.2 The AO called upon the assessee to clarify as to how the training programmes provided to participants from Corporate sector is in the league of educational activity distinct from ordinary business/ professional activity. The AO referred to various judicial precedents and eventually concluded that such fee charged by way of ‘training and development fee’ are business or professional activities distinct from ‘educational activities’ and consequently ITA Nos.141 & 142/Del/2024 Page | 5 cannot be said to be covered under the definition of ‘charitable purpose’ contemplated under s. 2(15) of the Act. 5.3 The AO accordingly invoked the provision of s.11(4A) of the Act and held that training etc. provided to corporate houses and other entities by the assessee are in the nature of business activity which is separate from educational activity and cannot be regarded as ‘incidental’ to educational activity carried on by the society. The AO thus held that receipts shown under the head ‘training and development fee receipts’ attributable to skill development etc. bears the character of ‘business and profession’ in terms of s. 11(4A) of the Act. The AO thus denied the exemption under s. 11(1) in respect of receipts falling under s. 11(4A) of the Act. 5.4 Consequently, net profits in relation to such receipts by way of corporate training after deducting certain expenses, quantified by the AO at INR 10,19,97,202/- was treated as taxable income from business and profession and levied taxes thereon. 6. Aggrieved by the denial of exemption claimed under s. 11 of the Act towards training and development receipts etc., the assessee preferred appeal before the CIT(A)-NFAC, Delhi. The assessee vociferously assailed the impugned action of the AO refusing to admit the claim of exemption on receipts under the accounting head ‘training and development receipts’. Wide ranging submissions were made on behalf of the assessee to contest the action of the AO. The Judgments relied upon by the AO were distinguished citing peculiar facts existing in the present case. 6.1 On appraisal of objects of the society and other factual matrix canvassed by the assessee, the CIT(A), NFAC, Delhi found merit in the plea of the assessee towards eligibility of exemption under s. 11 of the Act qua such receipts derived from corporate training etc. The CIT(A), NFAC, Delhi accordingly reversed the additions made by the AO. ITA Nos.141 & 142/Del/2024 Page | 6 6.2 The relevant operative para of the first appellate order granting relief is reproduced hereunder:- 5. “I have considered the facts of the case and written submissions of the appellant as against the observations/findings of the AO in the assessment order. The contentions/submissions of the appellant are being discussed and decided as under:- Ground No. 1 The main contention of assessee was that in absence of any valid show cause notice being served upon the assessee, the entire proceedings along with the final order passed are vitiated, and thereby, the additions/ disallowances made by the Ld. AO are liable to be summarily deleted. I have gone through the assessee's submissions and it was seen that assessee itself admitted that vide note sheet entry dated 20.12.2016 (placed at Pg 144 of PB), the Ld. AO required the assessee to explain as to why 'training and development fees’ of Rs. 16,55,27,212/- reflected in the income and expenditure account shall not be taxed as income from business and profession as required by section 11(4A) of the income tax Act, since TDS on the same has been deducted u/s 194C and 194J of the Act. It was also mentioned by assessee that in response to the above, the assessee vide reply dated 27.12.2016 (placed at Pg 145-329 and Pg 330-334 of PB) submitted the details/evidences. This clearly shows that specific show cause was given to assessee, and it has replied to the same also. Considering the above this ground of appeal is dismissed. Ground No. 2 The assessee is a 'society' registered under the Societies Registration Act, 1860 vide order no S-16683 and having PAN AAATR7314Q. The assessee is also registered u/s 12A of the Income-tax Act, 1961 vide order no. CIT- VI/TE/(62)/86/284 dated 08.08.1986. The assessee society is notified u/s 80G(5)(vi) of the Income-tax Act, 1961 vide order no. DIT(E)/2008-09/R-62/216 dated 08.05.2009. The assessee also runs educational institutions and universities under the Amity University Uttar Pradesh Act, 2005 (UP Act no. 11 of 2005). The objects of the assessee 'society' include the following: -To establish educational institutions of all descriptions, including public schools, polytechnics, vocational and management training institutions, colleges, research institutes, centers for instruction and diffusion of useful knowledge, etc. Diploma certificates, etc. shall be issued after the approval of the competent authorities. -To hold seminars, arrange lectures, conferences, debates, exhibitions and the like for the dissemination of knowledge and advancement of education. -To carry out research in all aspects of education including applied sciences. -To adopt and implement measures to promote intellectual, physical, moral and social welfare of students and teachers of educational institutions, and to supervise and improve the conditions of their residence, health and discipline. -To award stipends, scholarships and other financial facilities to students, teachers and research scholars for studies in Indian/ foreign institutions. ITA Nos.141 & 142/Del/2024 Page | 7 -All the income, earnings, moveable/ immoveable properties of the society shall be solely utilized and applied towards the promotion of its aims and objects, and portion thereof shall be paid/ transferred, directly or indirectly by way of dividends, bonus, profit or in any other manner whatsoever, to the present/past members of the society or to any other person. The AO noticed that assessee has received payments from various organisations for training their employees. The AO treated the same as business receipt holding that such training is not education. In the assessment order, the Ld. AO has placed reliance on the following judgments: - Supreme Court in the case of Sole Trustee, Loka Shikshana Trust Vs. CIT (1975) 101 ITR 234 - Delhi High Court in the case of Delhi Music Society Vs Director General of Income Tax 17 taxmann.com 49, 357 ITR 265 - Patna High Court in the case of Bihar Institute of Mining & Mine Surveying vs. CIT [1994] 208 ITR 608 - Delhi High Court in the case of Institute of Chartered Accountants of India, [2013] 35 taxmann.com 140 (Delhi). Judgment of Supreme Court in the case of Lok Shikshana Trust vs. CIT (1975) 101 ITR 234. The relevant findings of the Hon'ble Court are as under. \"The sense in which the word \"education\" has been used in section 2(15) in the systematic instruction, schooling or training given to the young is 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 education. According to this wide and extended sense, travelling is education, because as a result of travelling you acquire fresh knowledge. Likewise, if you read newspapers and magazines, see pictures, visit art galleries, museums and zoos, you thereby add to your knowledge. Again, when you grow up and have dealings with other people, some of whom are not straight, you learn by experience and thus add to your knowledge of the ways of the world. If you are not careful, your wallet is liable to be stolen or you are liable to be cheated by some unscrupulous person. The thief who removes your wallet and the swindler who cheats you teach you a lesson and in the process make you wiser though poorer. 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 sense 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 students by NORMAL SCHOOLING (emphasis supplied). The AO has put a great emphasis on the words \"normal schooling mentioned in the aforesaid judgment of Apex Court. As per the AO, the basic test to satisfy activity as an educational activity is that it must be provided by \"normal schooling\". In the mind of the AO, only the formal schooling is education as mentioned in section 2(15) of the Act. The assessee submitted that the Hon'ble Apex Court has itself inferred that providing of trainings to develop the knowledge, skill, mind and character of students is 'education', However, what the Court has laid down is that there must be a systematic system of imparting such trainings, which has been classified to be 'normal schooling. Thus, the Hon'ble Court has nowhere laid down that education is only limited to schools, colleges and similar institutions, and does not extend to any other media for acquisition of ITA Nos.141 & 142/Del/2024 Page | 8 knowledge. Further, no condition has been laid down by the Hon'ble Court that the recipients of the training programmes cannot be employees/personnel of corporate, etc. In the instant case, since the assessee company had a well-defined curriculum to impart trainings to personnel of various corporate, etc., it is not proper to construe the observations of the Supreme Court in a manner as construed by the Ld. AO. It was stated by the assessee that the aforesaid observations were made by the Supreme Court in the case of a 'newspaper/ publishing business' carried out by a sole trustee of a trust, whose education effects were only indirect, problematic and quite incidental. The Hon'ble Court noted that trust deed left it entirely to the sweet will of the sole trustee to decide all questions relating to policy or the way in which the needs mentioned in clause 2(c) were to be met. Provision for their satisfaction could be made in a manner which could be very lucrative. This was, the most relevant consideration in ascertaining the purpose of the trust from the point of view of profit making. However, in the instant case, the assessee is engaged in the activities of running universities, etc., which is amply covered within the ambit of the term 'education and all other activities other than the training fees are also undisputed in the impugned appeal before your Honors. No newspaper business has been carried out by the assessee. Moreover, the assessee is not a sole trustee of any charitable trust; rather, as stated in detailed facts supra, the assessee is a society regulated by the Amity University Uttar Pradesh Act, 2005. Section 6 and 7 of such Act also empowers the assessee to provide trainings and grant certificates/ diplomas. Thus, the facts of the present case and those prevailing before the Supreme Court in the aforesaid judgment are radically different, and hence, no adverse inference can otherwise be made. Delhi High Court in the case of Delhi Music Society vs Director General of Income Tax [2012] 17 taxmann.com 49. The AO has also relied upon the judgment of Delhi High Court in the case of Delhi Music Society vs Director General of Income Tax 2012 17 taxmann.com 49, 357 ITR 265. The AO has asserted that the most important test laid down by the Delhi High Court as to whether an activity is formal schooling or not is regarding \"maintenance of discipline and conducting examinations before granting degrees\". The assessee stated that the aforesaid judgment pronounced by the Hon'ble High Court was in the context of provisions of section 10(23)(c)(vi) of the Act. In that case, Hon'ble Court had to deal with the question as to whether petitioner is eligible for exemption u/s 10(23C)(c)(vi) of the Act. However, in the instant case, the question before you is whether assessee society is eligible for exemption u/s 11 of the Income Tax Act, 1961. I have gone through the AO's findings and assessee's detailed reply. My findings are as under: Consistency: It was submitted by the assessee that assessment in the case of assessee for the preceding two assessment years was also completed u/s 143(3) of the Act. In AY 2012- 13 & AY 2013-14, the case of the assessee was selected for complete scrutiny, wherein assessee submitted all the details and documents to substantiate its return of Income. After going through all the details submitted by the assessee, the Ld. AO has not doubted the training provided to corporate houses and duly considered the same within the definition of 'education' for the purposes of section 11(4A) and 2(15) of the Act. However, in the present year under consideration, while passing the impugned assessment order u/s 143(3) of the Act, the Ld. AO has disallowed the activity of providing corporate training to various clients out of the scope of 'education', despite all the facts and circumstances being absolutely identical and merely on the basis of TDS deduction by the parties. This clearly shows that the assessment order passed by the Ld. AO is in violation of principles of consistency. ITA Nos.141 & 142/Del/2024 Page | 9 It was submitted that it is settled principle in law that while res judicata does not, strictly speaking, apply to income-tax proceedings, the Courts (including the Hon'ble apex Court) have repeatedly emphasized that where the fundamental facts remained the same in different assessment years, it is not open for the Revenue to take one view in certain years and another view in other years. Activity of training - Education or not: In my opinion, there cannot be any fix formula to decide what education is and what is not. For this one should go through the facts of each and every case and then apply the ratios laid down by various courts. While dealing with the issue of education, one has to see the identity of the training provider. In this case, the training is provided by an institution which is recognised as a University. The training provided was properly structured as per the requirement of the organisations, attendance was ensured. Many of these organisations included government department and public sector undertakings; for example Ministry of defence, Department of science and technology, Food Corporation of India, Allahabad Bank et cetera. I can recall that as an IRS officer, I was also given Midterm career training at IIM Bangalore. This training was designed as per the needs of income tax department and a certificate was also issued. By no stretch of imagination, I can presume that the training provided by IIM Bangalore was not education and the receipt from the same was taxable. In my opinion, the word normal schooling should be construed in the context of actual facts. If the training is provided by a recognised university or college or institute, and that the training was properly structure and attendance was ensured then the same should fall in the category of education. The facts of this case have all these ingredients. Therefore, the activity of training would fall in the category of education. Application of sec11(4A):- In the present case, the assessee runs schools, colleges and university. The assessee is registered under 12A and 80G of the IT act. The objects of the assessee clearly mentions the following: \"To hold seminars, arrange lectures, conferences, debates, exhibitions and the like for the dissemination of knowledge and advancement of education\" The above object in my opinion clearly covers conducting of seminars and training. The objects of the assessee were before the income tax authorities and after considering the objects registration under section 12A and 80G were granted. Once an activity is covered by the objects of the institution/ trust, the provisions of section 11(4A) cannot be applied. Sec 11(4A) can be applied only when the activities are not covered by the objects. As mentioned \"earlier the objects of the assessee, in my opinion, clearly covers conducting of seminars and training. ITA Nos.141 & 142/Del/2024 Page | 10 Considering the above, the principles of consistency and the facts of the case, the AO is directed to delete the addition. This ground of appeal is allowed.” 7. Aggrieved by the relief granted by the CIT(A), NFAC, Delhi, the Revenue has knocked the door of the Tribunal. 8. When the matter was called for hearing, Ld.CIT DR for the Revenue placed heavy reliance on the assessment order. The Ld.CIT DR pointed out that the AO has examined the issue threadbare in the light of judgments of the Supreme Court and High Courts and rightly observed that the assessee is engaged in imparting training to Corporate Houses and such activities of the assessee are guided by commercial spirit which cannot be equated with charitable activity. 8.1 The Ld CIT-DR referred to the judgment rendered in the case of Loka Shikshana Trust (1975) 101 ITR 234 (SC) to contend that the word ‘education’ connotes the process of training and developing the knowledge, skill, mind and character of students by normal schooling and has not been used in the wide and extensive sense according to which every acquisition of further knowledge constitutes education. The Ld. CIT-DR pointed out that similar views have been expressed in Mehta Charitable Pranjanalay Trust (2012) 28 taxmann.com 73 (Del) and Delhi Music Society vs. DGIT (2012) 17 taxmann.com 49 (Del.) judgments etc. 8.2 The Ld. CIT DR next pointed out that the activities undertaken by way of training etc. are not a normal schooling contemplated in the Loka Shikshana but imparted to participants / employees of large corporates. Such income are clearly business income separate and distinct from education activity undertaken by the assessee society and there is nothing charitable about such activities. The Ld CIT DR next submitted that the corporate payers who were beneficiary of such training and development programmes by the society have deducted TDS on such payments to the Assessee society as they have always treated such payments to be professional services. The AO has thus rightly ITA Nos.141 & 142/Del/2024 Page | 11 invoked the provision of s. 11(4A) of the Act holding that such activities of the assessee are in the nature of business activity. Such activities are independent activities and not incidental to the attainment of educational objectives of the Trust. 8.3 The CIT-DR next contended that such activities are not incidental to formal schooling and structured study imparted by the assessee. Such training and skill development activities imparted to employees of corporates etc. are business activity or adventure in the nature of commerce. Besides, no separate books of accounts have been maintained by the assessee society for such activity and thus squarely falls within the mischief of s. 11(4A) of the Act. 8.4 The CIT-DR assailed the order of the CIT(A) for granting relief on the grounds of doctrine of consistency also. The Ld. CIT-DR submitted that the doctrine of consistency is not applicable in the present facts. Such fee has been assessed as offered by the assessee in those years and the nuances of the nature of fee were not examined by the AO at all. The Ld. CIT-DR contended that the rule of consistency cannot be of inflexible application in income tax matters. Such rule evolved by judicial precedents is not of wide applications and some erroneous or mistaken views taken earlier do not fetter the authorities by repeating them. It is based only an equitable principles and it has to yield to mandate of law. It was contended that a blind adherence to such rule would lead to anomalous results and therefore no such things as res judicata can be applied to tax matters where the stand of the assessee was passively accepted in the past. 8.5 The Ld.CIT DR submitted that mere registration under s. 12A does not provide automatic exemption under s. 11 of the Act. If the AO finds that pre- requisites for claim of exemption under s. 11 is not fulfilled, it is within the domain of AO to deny the benefit of exemption. The Ld.CIT DR thus asserted that the receipts by way of training and development programmes conducted by the assessee society are in the realm of business activity within the meaning of s. 2(13) of the Act and are outside the ambit of s. 2(15) of the Act. Hence, ITA Nos.141 & 142/Del/2024 Page | 12 the action of the AO invoking the provision of s. 11(4A) to deny benefit of s. 11(1) qua receipts obtained by way of training etc. could not have been faulted as incorrectly done by the CIT(A). The CIT-DR sought urged for restoration of the assessment order and setting aside of first appellate order on this score. 9. The Ld. Counsel, on the other hand, strongly supported the conclusion drawn by the CIT(A). The Ld. Counsel reiterated that the assessee society was formed and registered with an object to establish educational institutions, schools, polytechnics, Vocational, management training institutions and colleges etc. The assessee society is an umbrella entity for various educational institutions being run under the name of ‘AMITY’ with the setting up of a school way back in 1991. The society has set up universities, schools, colleges across all fields like science, technology, medicines etc. These schools, colleges and other educational institutions are affiliated to Central Board of Education, various universities and also its own university set up under the State Legislature for which copy of Memorandum of Association (‘MoA’) and Rules and Regulations of the assessee society were placed before the lower authorities and also before the Tribunal. 9.1 The Ld. Counsel adverted to the objects to the assessee society which broadly includes (i) To establish educational institutions of all descriptions, including public schools, polytechnics, vocational and management training institutions, colleges, research institutes, Centers for instruction and diffusion of useful knowledge. etc. Diploma certificates, etc. shall be issued after the approval of the competent authorities; (ii) To award stipends, scholarships and other financial facilities to students, teachers and research scholars for studies in Indian/foreign institutions; (iii) All the income, earnings, moveable/ immoveable properties of the society shall be solely utilized and applied towards the promotion of its aims and objects, and portion thereof shall not be paid/ transferred, directly or indirectly by way of dividends, bonus, profit or in any other manner whatsoever, to the present/past members of the society or to any other person. 9.2 In the backdrop of activities carried out, the Ld. Counsel contended that all the activities of the assessee are covered by s. 2(15) of the Act. To buttress ITA Nos.141 & 142/Del/2024 Page | 13 such contentions, the ld. Counsel adverted to the training fee receipts and submitted the university provides the knowledge and skill based training as part of its educational activities. Such trainings are part of the express objectives of the Assessee Foundation for spreading education through skills and knowledge based training on the strength of which the registration under s. 12A was granted to the assessee. Such trainings are extension of ongoing formal schooling and are integral to avowed objectives of education activity for which the society was formed. Mere charging of some fee in lieu of such Education programmes can not be construed as commercial activity. 9.3 The Ld. Counsel adverted to object of AMITY University established vide ‘AMITY University Uttar Pradesh Act, 2005’ [an Act of Legislature]. As per s. 6 of the said Act, the society is required to disseminate and advance knowledge by providing instructions, research and extension facilities in such branches of learning as it may deem fit. Further, s. 7 of this Act empowers the university to grant such certificates and diplomas for providing training. The assessee is authorized to conduct these training programmes in the campus. University itself is established and authorized under ‘AMITY University Uttar Pradesh Act, 2005’. The training courses in question are conducted in campus for which specified schedule is provided with curriculum. Record of attendance of the participants are maintained and forwarded to the respective companies. Disciplinary action, if any, is also taken by the employers of the participants. Examinations are conducted and certificates on successful completion are also awarded. The assessee is approached for training owing to expertise it possesses in the various fields and such programmes conducted for the purpose of betterment of the employees. Such training is a method of continuing education and thus cannot be labeled as business activity of commercial nature. Besides, the receipts from training is insignificant and measly in the context of whole set up and overall receipts. The AO has invoked the provision of s.11(4A) of the Act primarily because TDS on the receipts have been deducted by the payers of the training fee. The ld. Counsel asserted that ITA Nos.141 & 142/Del/2024 Page | 14 mere deduction of TDS by the corporates cannot alter the inherent nature of activity carried out by the Education Foundation and can be no ground for holding such receipts to be business activity with commercial intent. 9.4 The Ld. Counsel yet again adverted to the specific clauses of the objects of the Assessee Foundation which collectively empowers the Foundation to hold seminars, arrange lectures, conferences, debates, exhibition and the like for the dissemination of knowledge and advancement of nuanced education. The Ld. Counsel thus submitted that providing of training in the normal course in a systematic manner is integral part of the primary activity of formal schooling of the University/Foundation and cannot be artificially re-characterized as business activity of the foundation. 9.5 The Ld. Counsel thus contended that the provision of s. 11(4A) of the Act are thus wholly inapplicable in the facts of the case as rightly held by the CIT(A). 9.6 Adverting to the doctrine of consistency, the Ld. Counsel pointed out regular assessments were carried out in the earlier years AY 2012-13 & 2013- 14 for which assessment orders passed under s. 143(3) of the Act are placed in the paper book. The respective assessment orders clearly holds the activities of the assessee to be charitable in nature within the meaning of s. 2(15) read with s. 11(4A) of the Act. Hence, there is a need for consistency, certainty and predictability in the administration of Act. 9.7 The Ld. Counsel next submitted that the AO has applied the ratio of judgments rendered in the case of Loka Shikshana in an abstract manner disregarding the facts of the case and purport of the judgment. Likewise, other judgments referred have no application in the peculiar facts of the case as misjudged by the AO. The Ld. Counsel submitted that the assessee clearly meets the principles of formal schooling as laid down by the judgment of Hon’ble Supreme Court in the case of Sole Trustee, Loka Shikshana Trust and other judgments. ITA Nos.141 & 142/Del/2024 Page | 15 9.8 The Ld. Counsel relied upon the judgements rendered by the Hon’ble Delhi High Court in the case of CIT(Exemption) vs NIIT Foundation bearing ITA No.141/2021 dated 26.07.2024, decision of Co-ordinate Bench of the Tribunal in the case of Radiological & Imaging Association vs DDIT (Exemption), Ahmedabad [2018] (3) TMI 1760 (ITAT, Ahmedabad); Vadodara Chamber of Commerce and Industry vs ACIT, Circle-2(2), Baroda, 2019 (5) TMI 620 (ITAT, Ahmedabad) and M/s. Ambuja Cement Ltd., Mumbai vs ITO(TDS), Solan (HP) ITA No.648 & 649/Chd/2014 (ITAT, Chandigarh) to buttress the eligibility of exemption under s. 11 of the Act. 9.9 The Ld. Counsel finally iterated that activities undertaken are in consonance with its avowed objects based on which the registration has been granted under s. 12A of the Act and continuing. The benefit of s. 11(1) has been claimed on ground that the income from training and seminars etc. has been wholly utilised for charitable purposes for imparting education and thus excluded from the total income. The AO could not treat the surplus on account of such receipts as taxable income by applying s. 11(4A ) of the Act. 9.10 The Ld. Counsel thus submitted that while the AO has proceeded a mis-conception and law and mis-appreciation of facts, the CIT(A) has examined the issue in correct perspective and therefore, no interference thereon and has called for. 10. We have carefully considered the rival submissions and perused the material referred to and relied upon by respective sides. Essentially, the meaning of expression ‘education’ employed in s. 2(15) and applicability of S. 11(4A) are the bone of contentions between the assessee and revenue. The Revenue seeks to contend that training and development fee derived by the Assessee Society are in the nature of business activity in contravention of provisions of s. 2(15) r.w.s 11 & 12 of the Act and hence the exemption available to the Assessee under s. 11 of the Act do not cover such fee derived from training and development activity. The determination of such controversy ITA Nos.141 & 142/Del/2024 Page | 16 is essentially a question of fact and depends on facts of each case i.e nature of establishment and its activities. 11. In the instant case, the assessee is engaged in advancement of ‘education’. There is no dispute about the core nature of the captioned Institution / Trust/Foundation being charitable in nature. The object clause of the Foundation and receipts obtained also suggests the income has been derived from activities in accord with its objects. The controversy essentially revolves around the nature of training fee receipts. While Revenue seeks to recharaterise the revenue generated from such activity as business activity, the assessee claims it to be integral part of educational activity eligible from exemption under s. 11 of the Act. On facts, it is the case of the assessee that the training and other skill development fee of similar nature have been received using property held in trust i.e. the campus premises, goodwill attached to the Institution and knowledge bank available at the disposal of the trust. The training activities are thus adjunct to rest of academic activities carried by the Society/Trust/Foundation and such activities cannot be seen in isolation to other academic activities. The trainings are stated to be imparted in a very structured manner with well defined curriculum. The trainings are provided to the candidates for which record of attendances are maintained, examinations are conducted and certificates are distributed to successful participants. 12. Noticeably, the word ‘education’ in section 2(15) is not qualified by any restrictions per se. It has been used in its widest amplitude so as to include education of all level to all classes of the society or category. Clearly, it is not confined to any section or class of society or any particular type or level of education per se. Meaning thereby, any activity which includes or relates to education would ordinarily be for charitable purposes within the meaning of s. 2(15) of the Act. Significantly, it is nowhere the case of revenue that the fee collected by way of training and development is not utilised for educational purposes. ITA Nos.141 & 142/Del/2024 Page | 17 13. The training and development carried out by the umbrella entity in the instant case do not merely sub-serve other ongoing academic activities but rather an educational activity in itself. Thus, the assessee carries single activity of imparting education. The structured training programme availed year after year by many corporates for developing skills of its employees followed by certifications cannot treated as distinct from other academic activities. It would rather be unrealistic to segregate such activity and treat the same as commercial or business activity. 14. The grounds taken by the revenue that the assessee was carrying on the commercial activity which is not incidental to the objects of the trust and that the assessee has not complied with the provisions of s. 11(4A) by not maintaining separate books of accounts are found to be faulty. The revenue has committed wrong by holding that training and skill development activities carried out by the assessee has no relationship with the objectives of the trust. The Revenue has heavily relied upon the judgment in Loka Shikshana(supra). The judgement delivered in Loka Shikshana involves careful consideration of specific circumstances. In Loka Shikshana case, the assessee was engaged in printing and publishing newspaper and weekly & monthly journal and on that basis, it claimed that it is educating Kannada speaking people through newspaper and journal. It is in this factual background, the Hon’ble Supreme Court made observations that ‘education’ connote the process of training and developing knowledge skill by normal schooling. The Hon’ble Gujarat High Court had an occasion to comprehend and expound the judgement delivered in Loka Shikshana. In Gujarat State Cooperative Union vs. CIT (1992) 195 ITR 279 (Guj.), the Hon’ble Gujarat High Court noted the true purport of the judgment in Loka Shikshana. The Hon’ble High Court observed that the ‘education’ cannot be given a pedantic sense. As further noted, the Hon’ble Supreme Court in Loka Shikshana has indicated that the word ‘education’ cannot be used in loose sense so as to include acquisition of each and every knowledge. The observations of Hon’ble Supreme Court do not confine the word ITA Nos.141 & 142/Del/2024 Page | 18 ‘education’ only to scholastic instructions but other forms of educations are also included in the word ‘education’. The word ‘schooling’ also means instructing or educating. Thus, it cannot be said that the Hon’ble Supreme Court has given any unduly restrictive meaning to word ‘education’. The Hon’ble Gujarat High Court thus observed that it will not be proper to construe the observations in Loka Shikshana to infer the word ‘education’ to be limited to schools, colleges and similar instructions and would not extend to any other media for such diffusion of knowledge. While the concept of education need not be given any wide or extended meaning to include every knowledge, it surely would encompass systematic dissemination of knowledge and training on specialised subjects as is done by the assessee. The observations made in Gujarat State Cooperative Union on interpretation of Loka Shikshana are extracted hereunder; “……..The Supreme Court, in the above observations, by referring to the systematic instruction, schooling or training given to the young has only cited an instance in order to indicate as to what the word \"education\" appearing in section 2(15) of the Act which defines \"charitable purposes \" is intended to mean. We are certain that these observations were not intended to keep out of the meaning of the word \"education\", persons other than “young”. The expression \"schooling\" also means \"that schools, instructs or educates\" (The Oxford English Dictionary, Vol. IX, page 217). The Supreme Court has observed that the word \"education\" also connotes the whole course of scholastic instruction which a person has received. This clearly indicates that the observations of the Supreme Court were not intended to give a narrow or pedantic sense to the word \"education\". By giving further illustrations of a traveller gaining knowledge, victims of swindlers and thieves becoming wiser, the visitors to night clubs adding to their knowledge the hidden mysteries of life, the Supreme Court has indicated that the word \"education\" is not used in a loose sense so as to include acquisition of even such knowledge. The observations of the Supreme Court only indicate the proper confines of the word \"education\" in the context of the provisions of section 2(15) of the Act. It will not be proper to construe these observations in a manner in which they are construed by the Tribunal when it infers from these observations, in para 17 of its judgment, that the word \"education\" is limited to schools colleges and similar institutions and does not extend to any other media for such acquisition of knowledge. The observations of the Supreme Court do not confine the word \"education\" only to scholastic instructions but other forms of education also are included in the word \"education\". As noticed above, ITA Nos.141 & 142/Del/2024 Page | 19 the word \"schooling\" also means instructing or educating. It, therefore, cannot be said that the word \"education\" has been given an unduly restricted meaning by the Supreme Court in the said decision. Though, in the context of the provision of section 10(22), the concept of education need not be given any wide or extended meaning, it surely would encompass systematic dissemination of knowledge and training in specialised subjects as is done by the assessee.\" What was thus meant by the Hon’ble Supreme Court in the case of Loka Shikshana Trust (supra) is that education derived from casual & unstructured activities like travelling, reading newspaper and magazines, visiting art galleries, museums and zoos and so on, cannot be regarded as ‘education’ for the purposes of s. 2(15) of the Act. 15. As pointed out, another distinctive feature is that the assessee society is not run by a sole trustee of any charitable trust as was the case in Loka Shikshana. Rather the assessee society is regulated by AMITY University Uttar Pradesh Act, 2005 which inter-alia empowers the assessee to provide trainings and grant certificates/diplomas. These facts make the case of the assessee radically different from the case in Loka Shikshana Trust (supra). The facts of this trust does not empower to construe the observations of the Hon’ble Supreme Court in a manner as construed by the Revenue. 16. We notice that the assessee society has maintained books of accounts and audited financial statements have been filed in this regard. The assessee society claimed to be not engaged in any business activity per se and therefore any separate books of accounts in relation to business activities is not required to be maintained. Aligned with its express objectives, the assessee provides knowledge and skill based trainings to corporate, public and private sector enterprises for spreading education through skilled and knowledge based training and has derived certain receipts therefrom. While it is the case of the Revenue that such receipts are commercial in nature and therefore not entitled to benefit available under s. 11 & 12 in view of the s. 11(4A) of the Act, the assessee had disputed the action of the Revenue to be arbitrary & singularly contrary to facts on record. A reference has been made to objectives of the ITA Nos.141 & 142/Del/2024 Page | 20 AMITY University Uttar Pradesh Act, 2005 (the Act of Legislature) whereby the assessee society is required to disseminate, advance knowledge by providing such instructions, research and extension facilities. The AMITY University Uttar Pradesh Act, 2005 also empowers the assessee to grant such certificates and diplomas for providing training to the employees of various corporations based on the method, it may deem fit. The assessee grants certificates to the participants of the training programme in sync with it aims and objects of spreading education. The assessee has demonstrated the factual aspects with reference to the AMITY Act. Many companies have availed the training and skill development services offered by the assessee for several years. While conducting such programmes, record of attendance are prepared, examinations are conducted and certificates are awarded to the participants on successful completion of training programme. Such training programmes thus have all trappings of ‘education’. Such trainings are method of continuing education and cannot be considered as business activity. As per the object clauses also, providing of training in the normal course is integral part of the main activity of the University/foundation and cannot be viewed separately as business activity of the foundation which can be possibly covered under s. 11(4A) of the Act. 17. We now advert to the judgement rendered in the case of Delhi Musical Society (supra). It is noted that the aforesaid judgement was delivered in the context of s. 10(23)(c)(vi) of the Act whereas the assessee in the instant case is claiming eligibility for exemption under s. 11/2(15) of the Act. While s. 10(23)(C) of the Act employs the expression ‘University or other Education Institution’ existing solely for educational purposes, S. 2(15) of the Act, on the other hand, simply uses the word ‘education’ which qualifies for exemption under s. 11 of the Act. It may be pertinent to note that in order to claim exemption under s. 10(23C) , it is mandatory that there should be a university or education institution which imparts formal education with certain degree of control over students and should carry standard accountability whereas in order to claim exemption under s. 11, it is sufficient to carry out educational ITA Nos.141 & 142/Del/2024 Page | 21 activity without necessarily imparting formal education to the hilt and without necessarily maintaining stricter discipline as expected for educational institutions. The expression ‘education’ mentioned in s. 2(15) and educational institutions mentioned in s. 10(23C) thus cannot be read in parity. The term ‘education’ contemplated in s. 2(15) is a broader concept vis-a-vis the ‘educational institution’. The assessee is thus eligible for exemption under s. 11(1)(a) of the Act. 18. The AO has thus, to our mind, erroneously applied the purport of the judgments referred by the Hon’ble Supreme Court and other Courts. We also observe that mere deduction of TDS by the payer of training fee is not determinative of the character of receipt obtained by the payee. Thus deduction of TDS by the payers ipso facto cannot characterize the receipts as business receipts. 19. In the light of delineations above, the CIT(A) in our view has correctly concluded the issue in favour of the assessee in accord with the position of law. The view expressed by the CIT(A) thus does not call for any interference. 20. In the result, the appeal of the Revenue is dismissed. ITA No.142/Del/2024 [AY 2015-16] 21. Identical challenge on taxability of training and development fee derived by the Assessee Society being business activity has been put up by the revenue against the first appellate order. Facts are identical and similar as in ITA No.141/Del/2024 AY 2014-15(supra). The respective sides have canvassed identical plea. In view of the similarity of facts, our decision in ITA No.141/Del/2024 concerning Assessment Year 2014-15 would apply Mutatis Mutandis to this appeal of the Revenue as well. In consonance thereof, the appeal of the revenue in ITA No. 142/Del/ 2024 concerning AY 2015-16 is also found to be devoid of any merit. 22. In the result, the appeal of the Revenue is dismissed. ITA Nos.141 & 142/Del/2024 Page | 22 23. In the combined result, both captioned appeals of the Revenue are dismissed. Order pronounced in the open Court on 12th March, 2025. Sd/- Sd/- (VIMAL KUMAR) JUDICIAL MEMBER *Amit Kumar, Sr.P.S* (PRADIP KUMAR KEDIA) ACCOUNTANT MEMBER Copy forwarded to: • Appellant • Respondent • CIT • CIT(Appeals) • DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "