Urban Mirror Correspondent
New Delhi, July 10: The Lok Gathbandhan Party (LGP) today justified the move of the revenue department levying Rs 52 crore service tax on Indian Institute of Management Ahmedabad (IIM-A) treating it as a commercial coaching centre.
The spokesman of the party said here on Tuesday IIMs in the country have been charging hefty fees running into lakhs from the students and earning huge profits. Therefore they should be treated as commercial centres and all the rules of taxation including income tax should be applied on them. The spokesman said the claim of IIM-A that as an educational centre it should be exempted from all type of taxes is not justified, as the institution with huge earning through fees has become commercial venture and should be treated as such by the taxation authorities.
The spokesman said the issue is not just confined to only IIM-A, all other governmental and non-governmental institutions earning huge money through fees should be brought under the ambit of taxation. The spokesman said they are no longer just educational institutes working for charity but are profitable business centres. The spokesman said private higher educational centres have virtually turned into money-minting ventures with lots of governmental facilities. The spokesman has thus asked the central government to look into the matter to tax them and the revenue collected from these sources should be honestly and transparently spent on the education of poor families.
The spokesman said the central revenue department had slapped Rs 52 crore on IIM-A for the two-year postgraduate programme, the postgraduate programme in food and agri-business management, the fellow programme in management as well as the one-year postgraduate programme in management for executives (PGPX) as taxable since 2009-10. The spokesman said the IIM-A should not be allowed concession in the name of resource crunch as the institution is plush with money. The spokesman said the IIM-A move to seek the intervention of union HRD ministry is not at all justified and the union finance ministry instead of giving any concession to the institution should widen the scope in other institutions with massive earning through fees.
