ORDER
S. R. RAGHUNATHA, ACCOUNTANT MEMBER. – This appeal by the assessee is filed against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, for the assessment year 2016-17, dated 08.05.2025.
2. The grounds of appeal raised by the assessee are as under: –
1. The Commissioner of Income-tax (Appeals) (“CIT(A)”) erred both in law and on facts in upholding the additions made by the Assessing Officer (“AO”) amounting to Rs.61,15,273/-, being (a) excess of income over expenditure; (b) corpus donation received; and (c) donations made to other charitable trusts, by treating them as taxable under the head “Income from Other Sources”.
2. The CIT(A) further failed to appreciate that the activities of the Appellant were inherently educational in nature. The seminars and conferences conducted were aimed at disseminating knowledge on the latest advancements in medical treatment and served as Continuing Education Programmes (CEP) for professionals in the medical fraternity.
3. The CIT(A) failed to understand that the activities of the Appellant fall squarely within the scope of “education” as defined under Section 2(15) of the Act, which is an independent limb of the definition of “charitable purpose”. However, the CIT(A) erroneously classified the Appellant’s activities under “advancement of any other object of general public utility” only with the intent to attract the proviso to Section 2(15) of the Act, thereby unjustly denying the exemption otherwise available under Section 11 of the Act.
4. Without prejudice, even if the activities of the Appellant were to be considered as falling under the limb of “advancement of any other object of general public utility,” the CIT(A) has erred in invoking the proviso to Section 2(15) of the Act by incorrectly stating that the fees collected by the Appellant exceeded 20% of the gross receipts. In fact, the fees received by the Appellant amounted to only ?32,28,683/-, which is well within the permissible limit of 20% of the gross receipts of ?2,55,41,107/-. Therefore, the conditions for applying the restrictive proviso to Section 2(15) of the Act are not satisfied, and the exemption under Section 11 of the Act ought not to have been denied.
5. The CIT(A) failed to adjudicate upon all the specific grounds of appeal raised by the Appellant, particularly those demonstrating that the Appellant’s activities fall within the meaning of “charitable purpose” (more specifically educational) as defined under Section 2(15) of the Act. This failure constitutes a non-speaking order and a denial of proper appellate consideration.
6. The CIT(A) failed to take note of the fact that the delegate fees of the Appellant were used solely for defraying the costs of conducting educational conferences, which were open to the public and not for profit.
7. The CIT(A) erred in not appreciating the fact that there are no prohibitions or illegality for a charitable trust to receive sponsorship fee and delegate fee to conduct conferences.
8. The CIT(A) was oblivious to the fact that the registration under section 12AA of the Act to the Appellant was granted by the Commissioner of Income Tax (Exemption), only because the activities of the Appellant were public charitable as stated in clause 22(5) of the trust deed of the Appellant, “To conduct seminars, discussions, conferences, workshop, and other such activities in all fields and related matters”.
9. The CIT(A) erred in ignoring that the Appellant had applied a portion of its income by way of donations, to other registered charitable institutions having similar objects as the Appellant.
10. The impugned order is devoid of reasoned findings, fails to take into consideration of the elaborate written submissions made by the Appellant on multiple occasions, and therefore does not qualify as a valid speaking order.
11. In light of the above, and having established that the activities of the Appellant are charitable, it is humbly prayed that:
a. The appellate order passed by the CIT(A) under Section 250 of the Act, upholding the addition, be set aside;
b. The activities of the Appellant be rightly treated as educational/ charitable under Section 2(15) of the Act and the benefit of exemption under Section 11 of the Act be restored;
c. The additions made to the income of the Appellant amounting to Rs.61,15,273Z- be deleted in full; and
d. Any other relief deemed fit in the facts and circumstances of the case be granted.
3. The brief facts of the case emanating from the records are that the assessee is a public charitable trust established on 08.11.2002, registered u/s.12AA of the Act on 29.01.2003. The core object of the assessee is organising seminars, discussions, conferences, and workshops in the field of medicine, specifically neurology, for advancement of education and public awareness, as given in clause 22 of the Trust deed. During the impugned assessment year 2016-17 the assessee conducted the following three major conferences in furtherance of its objects:
| – | | Brain and Heart conference on 10-11 October 2015 |
| – | | MDSICON 2016 on 8-10 January 2016 |
| – | | International Congress on Child Neurology 22-24 January 2016. |
4. The assessee filed its return of income for the A.Y. 2016-17 on 29.03.2017 declaring a gross receipts of Rs.2,47,49,862/- and NIL income after claiming exemption u/s.11 of the Act. The case was selected for scrutiny under CASS and statutory notices were issued. During the assessment proceedings the Assessing Officer found that the assessee had conducted 3 seminars / conference during the impugned assessment year at Chennai on advancement of neurology. Hence, the Assessing Officer of the view that the assessee’s activity cannot be called as charitable and hence proposed to deny the exemption. Further, the Assessing Officer stated that the activities of the trust are not covered under education, relief to the poor, medical relief, preservation of environment and preservation of monuments or places or objects of artistic or historic interest. Therefore, the activities have to be examined as to whether it can be said that they fall within the ambit o ‘advancement of any other general public utility’.
5. Since, the assessee had collected the sponsorship and advertisement charges from Pharma companies to the tune of Rs.2.21 crores and Delegate fees of Rs.32.28 lakhs, the Assessing Officer concluded that the gross receipts is in the nature of trade, business and commerce and denied the exemption by holding as under:
“7.1 Therefore, the present trust can at best be said as a facilitator for conducting conferences after charging sizeable amount in the form of Sponsorship & Advertisement receipts and Delegate fees. Therefore, I don’t think that the activities of the institution can be said educational. The contentions of the assessee are not relevant on the above facts. In fact, the word ‘education’ has been defined by various Hon’ble High Courts, I rely on the following judgments of the court.
(a) Sole Trustee. LokShikshana Trust v. CIT (1975) 101 ITR 234 where the assessee trust was running newspaper and journals in Kannada language. The object of the Trust included educating the people through establishing and helping institutions. Practically printing of newspaper was the activity of the Trust. The Supreme Court Observed, “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. what education connotes in that clause is the process of training and developing the knowledge, skill, mind and character of students by normal schooling.
(b) In the case of Commissioner of Income Tax v. Oxford University Press 221 ITR 77 the Bombay High Court observed that the assessee was only operating a printing press and thereby engaged in the business activities. The assessee claimed that it was a part of Oxford University of UK and hence engaged in the activity of education and hence exempt us. 10(22). The plea was not favoured since the assessee themselves were not engaged in the activity of education. The income of the assessee was shared with the Oxford University in this case. The assessee claimed application for educational purposes. But the court viewed, “In our opinion, for exemption under section 10(22) of the Act, the University or the educational institution must exist as a University or an educational institution solely for educational purposes in India. In other words, in our opinion, the recipient of the income must have the character of a University or an educational institution in India. Its character outside India or it being a part of a University existing outside India or if being a part of a University existing outside India, in our view, is not relevant for deciding whether its income would be exempt under section 10(22) of the Act.”
(c) In the case of Commissioner of income Tax v. Sorabji Nusserwanji Paarekh 201 ITR 939 the Gujarat High Court opined that Assessee should be an institution primarily engaged in educational activities and not one assisting educational institutions. The trust was formed with the object of imparting technical education to the boys belonging to the Zoroastrian society. Initially, the institute was running educational institution. Later the trust could not run the institution and started merely granting scholarships to Parsi students. Trust established with the aim of imparting education Educational institution but was not running institutions. The court referred to the decision of the Apex Court in Sole Trustee, LokaShikshana Trust and observed, “it becomes clear that what the word “education” connotes is the process of training and developing the knowledge, skill, mind and character of students by normal schooling.
1. In the case of Addl. CIT v. Victoria Technical Institute (1979) 120 ITR 358, the Division Bench of the Madras High Court, the claim of the assessee before the court was that the objects of the institute fall within the concept of “education” on the ground that the primary object of the assessee was to impart instruction in handicrafts and the institute was a charitable trust and hence the income realized by the sale of the products made by indigenous craftsmen and skilled artisans was exempt under section 11(1)(a) of the Act. The Division Bench ruled that the assessee was not running any educational institution like a school or college. The activity of the assessee in granting scholarships to students studying in school of Arts and Crafts and sending them to various other places would fall under the head of “Advancement of any other object of general public utility” as used in section 2(15) of the Act. Such an activity, according to the Division Bench, would not fall within the scope of educational activity to be carried on by an educational institution established solely for educational purposes as understood under section 10(22) of the said Act. The Division Bench of the court, therefore, found not only that there must exist an institution, but that it must be an, educational institution to impart education to students. It must be very close to normal schooling.
7. 2 In view of the above, I hold that the activities of the institution cannot be called as “educational”. In fact I apprehend whether the activities of the trust can be said charitable at all. It is apprehended that the institution is nothing but a facilitator for conducting conferences on commercial basis. At the most the activity will come under the category of advancement of object of general public utility.
8. In view of the above, I hold that the objects and activities are general public utility in nature and the assessee is receiving commercial receipts to provide service to a rarified set of Medical Practitioners. The total such fees is much more than the threshold limit of 20% of gross receipts for the asst. year 2016-17. Accordingly, the objects and activities of the assessee are no longer charitable in nature. Once the activities are not charitable the activities of the institution cannot be said genuinely charitable Once the object of the institution is no longer charitable in nature, they are not eligible for any exemption u/s.11 of the Income Tax Act.
From the above discussion, it is clear that the object of the assessee falls under the fourth limb i.e. ‘the advancement of any other object of general public utility of the definition of “Charitable purpose” u/s 2(15) of the IT Act. By taking recourse to activities which are in the nature of business/ commerce as evident from receipts like Sponsorships and Registration fees, which are clearly in the nature of trade, business, commerce or providing services in relation to any trade, business, and commerce. The case of the assessee clearly falls within the ambit of sub clause (iii) of Section. 28 of the Income tax Act as the income derived by trade, professional or similar association from specific services performed for its members.
9. Thus, the receipts of the trust as discussed above are prima facie found as commercial receipts or fees in the nature of first proviso to clause (15) of section 2 of IT. Act. Since, sec. 11 will not operate in the assessee’s case, the taxable income of the assessee is determined in a commercial sense, as envisaged by Board’s Circular No.5P dated 19.6.1968. For better clarity, the relevant part of the Circular, for the purpose of the issue-in-hand, is given below:
“Where the trust derives income from house property interest on securities, capital gains, or other sources, the word “income” should be understood in its commercial sense. Le, book income, after adding back any appropriations or applications thereof towards the purposes of the trust or otherwise, and also after adding back any debits made for capital expenditure incurred for the purposes of the trust or otherwise”.
10. Accordingly, the excess of income over expenditure is reckoned as the base-point for computation of taxable income, and the assessment u/s. 143(3) is completed as under:
| Excess of income over expenditure as per income and expenditure statement | 5,15,215 |
| Add Donation to other Trusts | 55.00,058 |
| Add: Corpus Donations Received | 1,00,000 |
| Taxable Income | 61,15,273 |
6. Aggrieved by the order of the Assessing Officer the assessee preferred an appeal before the ld.CIT(A), NFAC, Delhi. The ld.CIT(A) confirmed the order of the Assessing Officer by holding as under:
“5. DECISION:
5.1. I have carefully perused the ‘Form 35’, the grounds of appeal, the Statement of Facts, written submission as well as impugned assessment order.
5.2. Briefly stating the background of the case, the appellant is a public charitable trust (AOP) registered u/s 12AA. It had filed its Return of Income (Rol) for the A.Y. 2016-17 on 29.03.2017 declaring a gross receipts of Rs.2,47,49,862/- and Nil income after claiming exemption u/s 11. The case was selected for scrutiny under CASS which was finalized with passage of an order u/s 143(3) on 27.12.2018. In such order taxable income of Rs.61,15,237/- was determined. Aggrieved with such order, the appellant has filed this appeal where ten different grounds have been preferred.
5.3. The appellant has assailed the impugned assessment order on different counts. During the year the appellant has shown following receipts ‘Delegate Fees’ Rs.32,28,663/-; ‘Sponsorship and Advertisements Rs.2,20,99,227/-. The appellant has explained that Rs.1,88,51,537/- out of the receipts were utilized for holding of the conferences on different medical issues. The Appellant also claims donations amounting to Rs.55,00,000/- to various registered charitable trusts.
5.4. The AO held that the activities of the appellant cannot be called educational because it was a facilitator for conducting conferences on commercial basis and therefore, “at the most activity will come under the category of advancement of object of general public utility”. The AO further held that
“the objects and activities are general public utility in nature and the assessee is receiving commercial receipts to provide service to a rarified set of Medical Practitioners. The total such fees is much more than the threshold limit of 20% of gross receipts for the asst year 2016-17. Accordingly, the objects and activities of the assessee are no longer charitable in nature. Once the activities are not charitable the activities of the institution cannot be said genuinely charitable. Once the object of the institution is no longer charitable in nature, they are not eligible for any exemption uls. 11 of the Income Tax Act.
From the above discussion, it is clear that the object of the assessee falls under the fourth limb i.e. ‘the advancement of any other object of general public utility’ of the definition of “Chantable purpose” u/s 2(15) of the IT Act. By taking recourse to activities which are in the nature of business/ commerce as evident from receipts like Sponsorships and Registration fees, which are clearly in the nature of trade, business, commerce or providing services in relation to any trade business and commerce. The case of the assessee clearly falls within ambit of sub-clause (ii) of Section. 28 of the Income tax Act.”
5.5. Thus, the issue in hand boils down to the debate whether the appellant fulfills the stipulation of ‘advancement of any other public utility’ so as to be includible in the definition of ‘charitable purposes’ as per section 2(15).
5.6. The term ‘Charitable Purposes’ has been defined in an inclusive manner u/s 2(15). In such definition, besides certain specified activities including education’; ‘advancement of any other object of general public utility’ is also included as charitable purpose. The sub-section however further does not specify as to what would constitute ‘advancement of any other object of general public utility but vide the first proviso it has been provided as what would not constitute ‘advancement of any other object of general public utility’.
5.7. From the prism of the proviso to section 2(15), any activity otherwise includible under the umbrella of advancement of any other object of general public utility’ would not qualify for inclusion if it is rendered for a cess or a fee etc. irrespective of nature of the use or application or retention of receipts unless such receipts is below the 20% of the total receipts or the eligible activity has been undertaken in the course of actual carrying out of such advancement.
5.8. In the present case, though the clause 22 of objects as given in the trust deed state that conduct of “.seminars, discussions, conferences, workshops and other such activities in all fields of medicine and related matters” would be done by it, the appellant has received fees of Rs.32,28,883/- from the doctors and pharma companies. Besides such fees the appellant has received ‘sponsorships and advertisement of Rs.2,20,99,227/- from ‘outside the organization’ which mainly include pharma companies. The AO has also pointed out that the receipt of ‘fees’ is more than 20% of the gross receipts of the year and also that the participants and beneficiaries of the seminars conducted by the appellant are ‘rarified medical practitioners. Here, it is pertinent to recall that the law clearly provides that ‘irrespective of the nature of the use or application or retention’ (emphasis applied), if a fees or a receipt by whatever name if availed the activity will not be includible in ‘advancement of any other object of general public utility’. In the present case receipts as discussed above are not disputed. Once the factum of receipt of fees or by any other name is established the application, including its retention is not material as per the amended statute.
5.9. This is trite law that under the tax statute no one can impute or substitute any term employed by the legislature. Similarly, for the interpretation of the tax statutes, principle of strict construction and literal interpretation has to be adopted.
5.10. In view of such discussion, I find no infirmity in the assessment order impugned here. All the grounds of appeal under consideration stand dismissed.”
7. Aggrieved the assessee is in appeal before us.
8. The ld.AR for the assessee assailing the action of the ld.CIT(A) submitted that the action of the ld.CIT(A) is erroneous and unjustified as the activities of the trust is purely development of education in the field of Neuro Medical. In support of his arguments in respect of the claim of exemption u/s.11 of the Act the ld.AR submitted the following:
“1. The object clause 22 of the Trust Deed reads: “To conduct seminars, discussions, conferences, workshops and other such activities in all fields of medicine and related matters. This object has been recognized to be “Public Charitable” by the Director of Income Tax (Exemptions) while granting registration under Section 12AA in accordance with section 12A of the Act which reads “the provisions of section 11 and 12 shall not apply in relation to income of any trust or institution unless the following conditions are fulfilled.”. the Principal Commissioner of Income Tax has granted registration under section 124(1)(ac)(i) of the Act on the ground that our trust satisfies the condition stipulated in this section.
2. During the Assessment Year 2016-17, the Appellant conducted three major conferences in furtherance of its charitable object of promoting education and awareness in the field of neurology.
3. All three conferences featured leading medical professionals and renowned international and national speakers in the field of neurology. Their participation ensured a high academic and professional standard, reinforcing the nature of the events as educational platforms, not commercial exhibitions. This fact is evident in the brochures submitted before the authorities, herewith attached as Annexure 3 (pages 51 to 66)
4. It is evident from the brochures annexed that the conferences are not limited to any specific audience and is open for circulation to the entire medical community.
5. The doctors who come from overseas also visit hospitals in Chennai and discuss live (medical) cases with Indian doctors. Thus, the conferences not only act as a platform for learning but also an event that show cases the advancement of the Indian hospitals/Indian doctors have done in the field of medicine to their overseas doctors which positively projects the perception/s about Indian doctors and Indian hospitals. Due to the discussions on the technical content of the conferences, and interactions that happen in the conferences, the acceptance by the overseas doctors of the skill of the Indian doctors, the updation levels and the medical treatment done by Indian doctors are internationally recognized.
6. The CIT(A) failed to appreciate the fact that the registration under Section 12AA of the Act to the Appellant was granted by the Commissioner of Income Tax (Exemption), only because the activities of the Appellant were public charitable as stated in Clause 22(5) of the trust deed of the Appellant, “To conduct seminars, discussions, conferences, workshop, and other such activities in all fields and related matters
7. The mere fact that there was an income or a surplus during the course of conducting the conferences, shall not alter the character of the main objects so long as the predominant object of education continues to be charitable, with no profit motive.
8. The surpluses if any arising out of the conferences are merely incidental to the main object of the Trust. The Trust is a charitable institution, and all of the other activities are merely incidental to the main object and predominant object Le. technical advancement in the field of neuroscience. Thus, it can never be said that the Trust is for profit. It is further submitted that the income and property of the Trust have been applied solely and exclusively for the promotion of objects set out in the Trust Deed and no part of such income or property could be distributed amongst the members in any form or utilized for their benefit in any year since the existence of the Trust.
9. It is submitted that what needs to be considered is, as to whether the charging of delegate fees and receiving sponsorship to conduct the conferences in an effective manner, would make the activity ‘commercial’ as held by the AO. The existence of these kinds of trust depends upon organizing seminars systematically and the Appellant has to collect fees for that effort. In such process, the surplus is needed for self-reliance and to meet the administration cost of the trust. Thus, the mere fact that there was income, during the course of conducting the conferences, shall not alter the character of the main objects so long as the predominant object of education continues to be charitable and not to earn profit. The test to be applied is only the nature of predominant activity and to determine whether the main or dominant purpose of the activity of holding conferences was motivated by its educational purpose and that profit was never a motive or the driving force.
10. The Act visualized three kinds of charitable purposes: (a) medical relief; (b) education, and (c) relief for the poor “per se purposes” and by the very nature of our activities, we come under “per se” purposes as Section 2(15) of the Act covers “education” as a distinct charitable purpose. Medical conferences, awareness programs, and dissemination of scientific knowledge through professional events conducted to achieve the objects of the trust have been recognized by various courts as “education”.
11. As the primary purpose of the trust is education, it will constitute charitable purpose even if it incidentally involves collection of surplus funds. This has been upheld in various judgments cited below. Such surplus funds are utilised to meet the running costs of the trust and are necessary for the survival and functioning of the trust.
12. The reasoning of the CIT(A) that because the beneficiaries are “a rarified set of medical practitioners, the charitable object is untenable, as the education of professionals is a charitable object, as it ultimately benefits the society by advancing public health through educated practitioners in specialised fields. The key element is not the formality of instruction, but the aim and substance which, in this case, is imparting latest medical knowledge and skill to practitioners for the improvement of public health.
13. The CIT(A) ignored the fact that the seminars conducted are primarily attended by medical practitioners does not erode their public character or charitable intent, as the benefit accrues to advancement of medical science for public health. Thus, the requirement under Section 2(15) of the Act is satisfied.
14. The AO has cited the Supreme Court’s observation in Sole Trustee, Lok Shikshana Trust v. CIT Sole Trustee, Loka Shikshana Trust v. Commissioner of Income-tax [1975] 101 ITR 234 (SC)/ [101 ITR 234] to infer that “education” must involve formal, scholastic instruction. However, this interpretation has been superseded or narrowed in subsequent decisions. Various courts have since recognised non-formal professional knowledge dissemination, including conferences and workshops, as falling within the ambit of “education”, such as in the cases further cited below. Thus, the case shall not be applicable the Appellant’s case.
15. Further, the AC’s reference to the decision of Commissioner of Income Tax v. Oxford University Press Commissioner of Income-tax v. Oxford University Press [1996] 135 CTR 163/221 ITR 77/89(Bombay)/[221 ITR 77] is not relevant to the instant case as that case involved a for profit printing press claiming exemption by association with Oxford University. The Bombay High Court rightly held that the entity itself must be an educational institution, which it was not. It also held that when Oxford University did not exist in India at all, the income of the Press in India cannot be held to be the income of a university. In contrast, the Appellant is a registered public charitable trust with its presence majorly in India, whose core object is to educate medical professionals through scientific conferences, and all its receipts are applied to that purpose. It is not a commercial auxiliary of any third-party institution, Therefore, no analogy arises.
16. The AD’s reliance on Commissioner of Income Tax v. Sorabji Nusserwanji Paarekh [201 ITR 939] is misplaced since in that case, the trust had ceased its educational activity and only granted scholarships, hence not qualifying as an “educational institution.” In contrast, the Appellant actively conducts conferences attended by hundreds of medical professionals, delivering training and updates in cutting-edge medical science. These are core educational activities, not passive support. Hence, this decision is also factually inapplicable
17. The Appellant places reliance on the following cases:
a. The decision of the Supreme Court of India in Queen’s Educational Society v Commissioner of Income Tax (SC)/[2015] 372 ITR 699 (SC) wherein it was held in Paragraph 19 that “It is clear that when a surplus is ploughed back for educational purposes the educational institution exists solely for educational purposes and not for purposes of profit.” (from pages 18 to 20). Thus, the mere generation of surplus shall not result in the main object of the trust being nullified and does not mean there is a profit motive associated to its functioning. (copies of the judgment enclosed in Annexure 4 (pages 67 to 92)
b. The decision of the High Court of Rajasthan in CIT (Exemption), Jaipur v. Anesthesia Society(Rajasthan) where it was held in Paragraph 6 that the assessee society has been constituted to bring the doctors dealing in Anesthesia specialty entitled to be registered with the Medical Council of
India together for the purpose of inter alia the development of medical science, publication of research magazine, to promote the research and practical work and to organise the seminars etc. Thus, in the considered opinion of this court, merely because the society is primarily created for the benefit and convenience of Anesthetists, it cannot be said that the object of the society is confined to its members practising in Districts. Obviously, the education programme and research work to be undertaken by the assessee society in larger perspective are going to benefit the public at large and therefore, the activities of the assessee society do fall within purview of general public utility.” (from pages 2 to 3). Thus, organizing seminars, discussions, conferences, and workshops in the field of medicine, specifically neurology, shall also be an activity of educational nature and shall qualify for an exemption even if it is of a rarified nature (copies of the judgment enclosed in Annexure 5 (pages 93 to 96).
C. The decision of the High Court of Gujarat in the case of DIT (Exemption) v. Ahmedabad Management Association(Gujarat)/[2014] 366 ITR 85 (Gujarat) wherein it was held in Paragraph 5.6 that “Now applying the ratio of the decision of the Division Bench of this Court in the case of Gujarat State Co-operative Union (supra) reproduced hereinabove and the activities of the assessee such as Continuing Education Diploma and Certificate Programme; Management Development Programme; Public Talks and Seminars and Workshops and Conferences etc., we are in complete agreement with the view taken by the tribunal that the activities of the assessee is educational activities and/or is in the field of education.” (from pages 8 to 11). Thus, in the present case, conducting conferences and seminars for advancement of education and public awareness shall also constitute educational activities. (copy of the judgment enclosed in Annexure 6 (pages 97 to 114).
d. The decision of the ITAT, Allahabad in the case of Gujarat Safety Council v. ITO [2020] 180 ITD 711 wherein it was held in Paragraph 11.4 that “.multifaceted activities in the form of handbook/literature published together with stated activities like holding conferences on industrial safety programmes, public talks, seminars, workshops etc. on ongoing basis to inculcate safety measures would also be bracketed in the league of ‘educational activities’ when tested in the light of the decision of the Hon’ble Gujarat High Court in the case of Ahmedabad Management Association.” (from pages 3 to 5). Thus, conducting conferences and seminars for advancement of education and public awareness in the field of neurology shall also constitute educational activities. (copies of the judgment enclosed in Annexure 7 (pages (15 to 122).
18. It is submitted that the general public utility limb is a residual category and does not absorb activities that are exclusively educational. When activities can clearly be classified as educational, there is no need to invoke the general public utility clause. Since all receipts and expenditures are towards educational programmes, the activity falls fully within the “education” head. Thus the CIT(A)’s application of the “general public utility limb is erroneous both in law and on facts. The Appellant’s activities fall squarely under “education”, making them fully charitable and outside the ambit of the Section 2(15) proviso.”
9. Further, the ld.AR submitted that the assessee has been existing from 2002 and carrying on the same activities by claiming the deduction u/s.11 of the Act as detailed below:
10. The collections and the expenses for seminar for the various years are as under:
| Assessment Year | (Rupees in Lakhs) |
| Collection | Expenses |
| 2007-08 | 17.62 | 16.01 |
| 2008-09 | 19.41 | 22.04 |
| 2009-10 | 15.75 | 13.43 |
| 2010-11 | 11.67 | 13.05 |
| 2011-12 | 33.05 | 22.13 |
| 2012-13 | 29.57 | 39.65 |
| 2013-14 | 36.23 | 33.92 |
| 2014-15 | 37.84 | 30.85 |
| 2017-18 | 36.84 | 50.84 |
| 2018-19 | 49.74 | 45.82 |
11. The ld.AR stated that in all the earlier years and in subsequent years, the exemption u/s.11 of the Act had been allowed. The amendment to Section 2(15) of the Act prohibiting any Trust to carry any activity in the name of trade, commerce or business was introduced by the Finance Act 2008 with effect from 01.04.2009. In all the years, before and subsequent to assessment year 201617, the assessee’s submission was accepted, and the exemption u/s.11 of the Act had been granted.
12. The ld.AR further submitted the case laws relied upon by the AO are on different facts and are therefore not applicable to the present case:
– Sole Trustee, Loka Shikshana Trust v. Commissioner of Income-tax [1975] 101 ITR 234 (SC), has been dealt with in Director of Income-tax (Exemption) v. Ahmedabad Management Association (Gujarat).
“It is not necessary to nail down the concept of education to a particular formula or to flow it only through a defined channel. Its progress lies in the acceptance of new ideas and development of appropriate means to reach them to recipients.”
– CIT v. Oxford University Press Commissioner of Income-tax v. Oxford University Press (Bombay)/[221 ITR 77].
It only printed books and supplied them to university and hence not applicable.
– Commissioner of Income-tax v. Sorabji Nusserwanji Parekh(Gujarat)/ [201 ITR 23].
This gives only scholarships to students and having not engaged in educational activities.
13. Per contra, the ld.DR for the revenue relied on the orders of the lower authorities and prayed for confirming the ld.CIT(A) order by dismissing the appeal of the assessee.
14. We have heard the rival contentions perused the material available on record and gone through the orders of the authorities along with paper book filed and case laws relied on. The assessee is a charitable trust existing from 2002 and have been claiming the exemption from its inception. The basic activity of the trust is conducting seminars in the field neuro medicine for advancement of knowledge. Similarly, during the impugned assessment year also the assessee had conducted 3 seminars for doctors in the field of neurology at Chennai by having a gross receipt of Rs.2,47,49,862/- and claimed an exemption u/s.11 of the Act.
15. The core question before us is whether such activities constitute “education” within the meaning of section 2(15) of the Act, or whether they are commercial activities falling within the mischief of the proviso.
16. The expression “education” in section 2(15) has been interpreted liberally by various judicial authorities to include not merely formal schooling but also systematic dissemination of knowledge through seminars, workshops, and continuing education programmes.
17. The Hon’ble Gujarat High Court in Ahmedabad Management Association (supra) held that conducting management development programmes, public talks, and conferences amounts to educational activity. Similarly, in CIT (Exemption) v. Anesthesia Society (Rajasthan), the Rajasthan High Court held that organising medical seminars and research conferences constitutes charitable activity even if primarily attended by medical professionals.
18. Applying the same principle, we hold that the assessee’s activities in organising neurology conferences and workshops squarely fall within the ambit of “education” under section 2(15).
19. The mere generation of surplus from an educational activity does not imply profit motive, so long as the surplus is applied solely towards the objects of the trust. This legal position has been clearly enunciated by the Hon’ble Supreme Court in Queen’s Educational Society v. CIT(SC)/[2015] 372 ITR 699 (SC), wherein it was held that when surplus is ploughed back into educational purposes, the institution exists solely for education and not for profit.
20. In the present case, there is no material on record to suggest that any part of the income or property of the trust was diverted for private benefit. All receipts, including sponsorships and delegate fees, were utilised for conference-related expenses or donations to other registered charitable institutions having similar objects. Therefore, the existence of surplus cannot be a ground to deny exemption.
21. The CIT(A)’s conclusion that the proviso applies is misplaced. Even assuming, arguendo, that the assessee’s activities fall under “advancement of general public utility,” the condition precedent for invoking the proviso—receipts exceeding 20% of total income from commercial activities—is not satisfied, as delegate fees amount to only 12.6% of total receipts.
22. Moreover, since we have already held that the assessee’s activities fall under the independent head “education,” the proviso to section 2(15), which applies only to the residual limb, is irrelevant.
23. We find that in all prior and subsequent assessment years, the Revenue has accepted the assessee’s claim of exemption u/s.11 of the Act on identical facts. No change in law or factual matrix has been demonstrated by the Department for the impugned year. The principle of consistency, as laid down by the Hon’ble Supreme Court in Radhasoami Satsang v. CIT ITR 321 (SC), therefore mandates that a different view should not be taken in the absence of change in facts or circumstances.
24. In view of the foregoing discussion and the judicial precedents cited, we hold that the assessee’s activities constitute “education” within the meaning of section 2(15) of the Act and the proviso to section 2(15) is inapplicable. Therefore, in our considered view the assessee is eligible for exemption u/s.11 and 12 of the Act. Thus, the additions made by the Assessing Officer and confirmed by the ld.CIT(A) amounting to Rs.61,15,273/- are unsustainable and hence we direct the AO to delete the same.
25. In the result, the appeal of the assessee is allowed.
Order pronounced in the open court on 30th October, 2025 at Chennai.