Patanjali Yogpeeth, a charitable organization, led by Yoga Guru Baba Ramdev successfully won the tax-exemption status before the Income-tax Appellate Tribunal on February 19, 2017.
The tribunal before making the judgment referred to a 2006 amendment to the I-T Act, and called Yoga as a procedure which gives medical relief and education. The tribunal called "Yoga" a charitable purpose thus exempting it from Income Tax.
Exemptions from Tax under Section 11 and 12
The Delhi Tribunal during the judgment told that Baba Ramdev's Patanjali Yogpeeth have been conducting medical camps for more than one decade which gives them the privilege of Tax Exemption under section 11 and 12 of the Income Tax Act.
It should be noted that Yoga was not considered as a charitable purpose previously and as a result, Patanjali Yogpeeth was liable to pay Income Tax as per the norms. An amendment was made in the Income Tax Act on April 2016, and it inserted Yoga in the category of charitable works.
The Delhi Tribunal also gave exemptions to corpus donations of about Rs 43.98 crore which was procured by the Patanjali Yogpeeth. As per the Tribunal, a major part of the money received as a part of donations was being used to build cottages to practice Yoga, which can be given tax exemption.
Ramdev's Patanjali Will Not Pay Tax Now, Tax Tribunal Exempts It Because Of 'Yoga' Tag https://t.co/PPR0WPIEzS via @indiatimes
— Riya Mukherjee (@riyalovezu) February 19, 2017
The Tribunal during the ruling told that Patanjali Yogpeeth is a charitable organization which mainly researches and develops yoga, Ayurveda, and other Indian traditional medicines.
Revenue of more than $780 million
If patanjali gets tax exemption because it promotes yoga then people should get tax exemption for practicing yoga.
— Jabez Ebenezer (@Jabez_1991) February 20, 2017
Food for thought
In a recent report, Forbes has published that the annual income of Patanjali Yogpeeth is more than $780 million by selling herbal toothpastes, noodles, jams, and cosmetics.
Even though Balakrishna is running the operations for Patanjali, the major face of the brand is none other than Baba Ramdev, the Yoga Guru who is the company’s de facto brand ambassador.
As per Balakrishna, most of the Patanjali's profit are being donated to various charities and trusts. In an interview with CNN, Baba also said that profits from Patanjali Products goes to charity.
