Merely charging of fees does not make an educational institute non charitable

Jaycees Public School Vs. ITO (ITAT Delhi)

We do not find that assessee is not engaged in the educational activities as merely charging of the fees does not make it existing for the purposes of the profit. This fact is also fortified for the reason that assessee has earned very meager amount of sum and which is also not alleged to have been applied for non-educational purposes. The assessee is running an educational institute but that does not mean that assessee must run it for free. Further it is also not alleged that the fees charged by the assessee is exorbitant and the primary motive of the assessee is to earn the profit. If the assessee does not charge the fees from student then it would not be possible for trust to carry on its activities for which it is established as the excess would not be available for ploughing back for development of the educational facility for the students. Hence, we do not find that the order of the Ld. CIT in cancelling the registration to the trust is sustainable.

Full Text of the ITAT Order is as follows:-

1. These are the 3 appeals filed by the assessee, a society carrying on educational activities.