TaxTMI 
TaxTMI 
2008 (10) TMI 148
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....ion and Technology, Ministry of Communication and Information Technology. The appellant is exempt from payment of Income-tax under Section 35(i)(ii) of Income-tax and also under Section 12(A)(a) of Income Tax 1961 being a charitable trust. The appellant is also recognized as a Scientific Society under the Department of Information Technology, Ministry of Communication and Information Technology and Scientific and Industrial Research Organization by the Ministry of Science and Technology. It is urged that the appellant is engaged in the research, design and development of super computers (PARAM Computers), Information and Communication Technology, Electronics. C-DAC is also engaged in imparting training/education in Information Technology and related fields. The appellant was given the mandate to build up and mobilize high quality research and development manpower in advanced computing within the shortest possible time, which is a part of their R&D activity. The appellants, in order to fulfill the objectives as enshrined in their Memorandum of Association are also imparting education in the field of software and hardware leading to the issuance of various diplomas such as Diploma in....
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....oaching and training was never intended to be covered under the taxable service of 'commercial training and coaching.' It was stated that the Board's circular makes it clear that only centres which are training and coaching students for various examinations and which receive consideration are coming under the category. An institution which is providing very advanced training in a field cannot be called as a 'commercial coaching and training centre.' Moreover, much emphasis was laid on the profit motive. As the appellant is a society registered under the Societies of Registration Act, there is absolutely no profit motive even the Income Tax Department has granted registration under Section 12(A)(a) the income derived is completely exempt from income tax. Our attention was also invited to the Memorandum of Association which states that the purpose of the society is to impart education. Clause 4 of the memorandum reads as follows: "All the incomes, earnings, movable and/or immovable properties of the Society shall be solely utilized and applied towards the promotion of the objects only as set forth in this Memorandum of Association and no portion thereof shall be paid or transferre....
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.... Centre - 1998 (100) E.L.T. 439. 9. It was urged that the education is a broad term and coaching and training have a very narrow meaning. Education may include coaching and training but not vice versa. Further, our attention was invited to the Memorandum of Association to Clause 3 which is reproduced herein below: 3.1.1 To undertake in a selective, time bound and mission oriented basis, research, Design and Development of the state of the art advanced computing systems so as to realize internationally competitive products in terms of cost performance and quality 3.1.2 To facilitate and promote specific actions and programs in the area of components, hardware and software that would result in upgradation of technologies required for advanced computing. 3.1.3 To evolve strategies and conduct, co-ordinate, and support research and development efforts in the country on advanced computing so as to (a) attain and maintain technological competence (b) enhance self-reliance and (c) reduce vulnerability in this strategic area. 3.1.4 To build up and mobilize high quality research and development manpower in advanced computing within the shortest possible time. 10. The cours....
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....be classified within the ambit of commercial training or coaching centre. Profit motive is immaterial. Further, he reiterated the contentions in the impugned order. 12. On a very careful consideration of the issue, we find that the primary object of the appellant is doing research in advanced computing. They are also engaged in doing research on super computers and very advanced computation. Therefore, while this sort of institute which is mainly doing research activity in advance computing, incidentally can impart training in certain aspects of advanced computing for a consideration. That does not mean that it is a coaching or training institute. In our view, after going through the objectives in the Memorandum of Association, we are convinced that the appellants cannot be classified as 'commercial training or coaching centre.' Moreover, the appellants are registered society and they are also a scientific society recognized by the Science and Technology, Department of the Government of India. The Income Tax Department has also given registration as a charitable society and the appellants are not liable to pay any income-tax. In view of all these, it is very clear that the appel....