Trust accredited by National Open School eligible for registration u/s 12AB & u/s 80G

Trust accredited by National Institute of Open Schooling eligible for registration u/s.12AB and u/s 80G of the Act.

In a recent judgment, ITAT Chennai has held that assessee trust accredited by National Institute of Open Schooling (NIOS) and imparting education with aims to achieve fluency in Sanskrit with syllabus based on NCERT would fall within the definition of “education” u/s.2(15) of the income Tax Act.

ABCAUS Case Law Citation:
5034 (2026) (02) abcaus.in ITAT

The assessee was a public charitable trust with the objects of imparting education. The assessee filed applications vide Form 10AB seeking registration u/s.12AB and approval u/s 80G(5) of the Income Tax Act, 1961 (the Act) respectively. In the Form 10B, the assessee had stated that the objects of the trust are ‘education’ and ‘relief to poor’.

Thereafter, the CIT(Exemption) issued a notice seeking information such as genuineness of activities, utilization of funds, compliance with the Act and other laws.

The assessee submitted that the trust was dedicated in providing decolonised Indian education and impart education with aims to achieve fluency in Sanskrit and more with syllabus based on NCERT programs which results in students of the assessee, after passing out their institution, getting admitted into CBSE or ISE board.

With regard to accreditation and recognition, the assessee submitted that it had a Memorandum of Understanding (MoU) with National Institute of Open Schooling (NIOS). The assessee submitted documents for curriculum, time table, subjects taught, Transfer certificate and explained that the students who leave the institution get admitted into other schools/institutions.

However, the CIT(E) rejected the applications observing that the activities of the trust could not be held ‘education’ as the trust had not imparted education in a systematic manner and that the trust lacked valid recognition from any authority.

The Tribunal observed that the NIOS was established in the year 1989. The NIOS is an autonomous organisation set up by the Ministry of Human Resource Development, Government of India. Through the notification in 2002, the ministry notified that the courses of NIOS are to be treated in equivalence of other boards and that the NIOS is also vested with power to conduct Secondary and Sr. Secondary levels of examinations. It is pertinent to note that students who have completed their schooling by way of NIOS are also eligible to be admitted into colleges including medical colleges. As such, NIOS also can accredit an institution so as to enable such institutions to teach and educate children. For any institution to obtain such accreditation, they have to fulfil certain norms and criteria.

The Tribunal further observed that in the case of the assessee, it had obtained accreditation for Open Basic Education Programme (OBC programme), it had also fulfilled the criteria required for such accreditation such as, trust being registered and carrying out its objects for at least 3 years, having libraries, trained teachers, etc. Further, as per MoU signed with NIOS, the assessee was to follow the academic calendar as prescribed by the NIOS and the syllabus was also to be prescribed by the NIOS, which is based on the NCERT-syllabus. The MoU also contained terms regarding the conduction of exams, duration of classes, etc.

The Tribunal opined that the assessee was having formal and systematic education in place as mandated by the MoU with NIOS and that NIOS is an autonomous organisation set up Government of India and is authorised to give accreditation to institutions, which made the accreditation obtained by the assessee for OBE programme a valid one. Therefore, view of the CIT(E) could not be accepted that the assessee did not conduct systematic formal education in line with their objects of the trust. 

Accordingly, the ITAT held that the assessee was engaged in providing formal and systematic education with a valid recognition from a government body and therefore, the activity of education as carried out by the assessee would fall within the definition of “education” u/s.2(15) of the Act and the assessee was eligible for registration u/s.12AB of the Act and u/s.80G of the Act.

As a result, the Tribunal directed CIT(E) to grant the registration u/s.12AB and u/s.80G of the Act to the appellant assessee.

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