The Day As It Unfolds

Baba Ramdev’s Patanjali Gets Tax-Exempted Status


Patanjali Yogpeeth, the FMCG company of Baba Ramdev has been exempt from taxes, giving a blow to the sector, which is reeling under the effect caused due to demonetization in India.

Baba Ramdev’s Patanjali Yogpeeth has been exempted from taxes by the Income Tax Appellate Tribunal (ITAT). The ruling was given out by the ITAT, due to Patanjali’s involvement in imparting education in the form of yoga and also for providing medical relief.

According to reports from DailyO, the order that the ITAT gave out, drew reference from an amendment in the Income Tax Act that was made in 2006. The amendment specifies that “yoga” falls under the category of “charitable purpose” and this encouraged the tribunals to exempt Patanjali from taxes.

The report further states that this will undoubtedly skew the FMCG sector as one company will be enjoying the benefits of tax exemption and in times to come, the company might showcase monopolistic nature in the Indian market. Moreover, this comes at a time when the entire FMG sector is reeling in the aftereffects of demonetization that impacted even the big houses like Hindustan Unilever Ltd. (HUL), as well as Nestle.

However, Patanjali Yogpeeth has seen a two-fold revenue growth with its base of 30 products. The products from the brand range from milk powder, biscuits to fairness cream as well as cooking oil.  It must, however, be mentioned that Patanjali Ayurveda was also embroiled in controversies after some of its products like jam, mustard oil, salt honey and a few more failed the quality tests and also when the company misbranded and were misleading the consumers with false information.

Notably, Patanjali Yogpeeth uses the fame of Baba Ramdev’s “yogic” credentials to establish its brand and sell products. Moreover, unlike charitable trusts, “Yogpeeth” is a portal through which the consumer goods are sold to the consumers.



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