Government

Baba Ramdev’s Patanjali Yogpeeth Granted Tax-Exempt Status

Baba Ramdev meets Prime Minister Narendra Modi. Credit: Wikimedia Commons

Baba Ramdev meets Prime Minister Narendra Modi. Credit: Wikimedia Commons

According to The Indian Express, the Income-tax Appellate Tribunal (ITAT) has afforded tax exempt status to Baba Ramdev’s Patanjali Yogpeeth (a ‘public charitable trust’). The Delhi bench of the tribunal ruled that because Patanjali Yogpeeth provides medical relief and imparts education, it may be deemed “charitable” and hold IT exempt status under sections 11 and 12 of the Income Tax Act.

“The finding of IT authorities that propagation of yoga by Patanjali Yogpeeth does not qualify as medical relief or imparting of education is not justified,” stated the ITAT in its order, quoted by Indian Express.

The ITAT in its order also referred to the 2006 amendment to the IT Act, which sought to accommodate yoga within the definition of “charitable purpose”.

The tribunal also ruled that corpus donations aggregating to Rs 43.98 crore, received by Patanjali Yogpeeth primarily to construct cottages under its Vanprasth Ashram Scheme (which provides accommodation to those attending residential yoga courses), were capital receipts not liable to IT, The Financial Express reported. Such donations included land valued at Rs 65 lakh by IT authorities. The ITAT also pointed out that “Corpus donations are not taxable, even in circumstances where the trust is not eligible for I-T exemption”.

Patanjali Yogpeeth, Baba Ramdev’s flagship project, is one of India’s largest yoga institutes. Its purpose is to practise, research and develop yoga and ayurveda, as well as manufacture ayurvedic medicines. Acharya Balkrishna, the general secretary of Patanjali Yogpeeth, is amongst India’s 100 richest people with a net worth of $2.5 billion and 97% stake in Patanjali Ayurved Limited.

“With revenue of $780 million, Patanjali sells everything from herbal toothpastes and cosmetics to noodles and jams. Though Ramdev holds no shares in Patanjali, he is the company’s de facto brand ambassador, while Balkrishna runs operations. Among much else, Balkrishna also oversees 5,000 Patanjali clinics, the Patanjali University and a yoga and Ayurveda research institute. He says that Patanjali’s profits are donated to various trusts and charities,” wrote Forbes.

  • AM

    Primarily a conduit for money laundering.

  • ADD Value

    Good Decision, With multi million dollar worth of charity , 2.5 billion dollar net worth and 780 million dollar annual revenue its difficult to pay taxes. Govt should share this benefit with more SME’s.