SC order puts 'charity' in charitable education institutes back in focus

Possible loss of tax exemption for educational institutions that are making profits puts the question of charity back in focus

Educational institutions are apprehensive of the recent Supreme Court ruling that could take away the income tax exemption if these entities are making profits and run for such a purpose. Many such institutions feel that the decision would hurt the sector and impact the growth prospects of educational institutions in the country.

Most educational institutions in India are formed as charitable trusts, even though the option for going through the corporate route exists. According to the Association of Indian Management Schools (AIMS), around 60 per cent of the institutions come under charitable trusts and another 40 per cent are registered under