Anugraha Education Trust Vs CIT (Exemptions) (ITAT Bangalore)
Assessee, a registered charitable trust engaged in educational activities had already received registration u/s 12A, which allows it to claim income tax exemptions, & also had provisional approval u/s 80G. Trust applied for permanent approval u/s 80G, submitting Form 10AB which was rejected by the CIT (Exemptions), .
CIT (E) rejected the Trust’s request on the grounds that the receipts in the form of school bus fess, tuition fees & exam fees do not fall under the definition of donations & therefore, held that the provisions of sec 80G of the Act are not applicable in the case.
Before the Tribunal Assessee trust argued that the CIT(E) erred in rejecting the grant of approval u/s 80G on the ground that school bus fees, tuition fees & exam fees collected by the assessee trust for certain financial years do not fall under the definition of donation. For grant of approval u/s 80G, the CIT(E) should only be satisfied about the genuineness of the activity of the trust & fulfillment of the conditions laid down in clause (i) to (v) of sect 80G(5).
Per contra, Revenue argued that 80G is for voluntary donations only. School fees paid to educational institutions, even if they are recognized u/s 80G, are for payment of services & are not akin to voluntary donations. Dept also argued that if the school issues donations receipts with 80G recognition for the fees received, it would amount to misuse/ misrepresentation. It would be wrong on the part of the school to issue such donation receipts for the fees paid.
