The Income Tax Appellate Tribunal (ITAT), New Delhi hold that the assessee is eligible for registration under Section 12AA by ruling that skill development is akin to providing education.
C.R. Dadhich Memorial Society (assessee) established under the Haryana Registration and Regulation of Societies Act, 2012 with main object to render efficient services to nation, to take over, establish run and manage teacher training institutions and provide other facilities to the requiring of educational institutions in General and for handicapped and distress people in particular etc. the assessee runs skill Development training centre in affiliation with Pradhan Mantri Kaushal Vikas Yojana (PMKVY).
The assessee applied for registration u/s 12AA of the Income Tax Act, 1961 which was rejected by stating that imparting skill development does not tantamount to charity and does not cover under the charitable activities mentioned in section 2(15) of the Income Tax Act. After this rejection, the assessee applied again for registration u/s 12A of the Income Tax Act, 1961 and duly replied all the queries raised by the Commissioner of Income Tax (CIT), who again passed the order of rejection u/s 12AA. The CIT in the order stated that imparting skill development training doesn’t partake the meaning of public charity.
B. R. R. Kumar, Accountant Member and Yogesh Kumar U S, Judicial Member while deciding the case relied on the judgment in ESCORTS SKILL DEVELOPMENT v. CIT (EXEMPTIONS), wherein it was held that “”imparting skill development training by the applicant company which is also a flagship project of the Government of India for sustaining its growth rate and to create the pool of skill worker to further enhance its growth and development is a charitable activity following within the definition education u/s 2(15) entitling the applicant company for registration u/s 12AA of the Act and consequent approval u/s 80G of the Act, hence both the appeals filed by the applicant company are allowed directing the CIT (E) to provide registration u/s 12AA to the assessee and grant consequent approval u/s 80G of the Act.”
The Tribunal observed that “Since, imparting skill development is akin to providing education we hereby hold that the assessee is eligible for registration u/s 12AA of the Act”.
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