COMMISSIONER OF INCOME TAX Vs. ASHOKA CHARITIES

JUDGEMENT

(1.) AT the instance of the Revenue, the following question has been referred to this court for its opinion by the Income-tax Appellate Tribunal, Madras :

(2.) THE assessee is a trust and for the year 1974-75 it filed a return admitting an income of Rs. 17,690, after claiming exemption in a sum of Rs. 18,628 spent on charity under section 11 of the Income-tax Act, 1961. THE Income-tax Officer, however, took the view that for the attainment of general public utility the assessee carried on an activity for profit and therefore it is not entitled to any exemption. THE Income-tax Officer also found that the assessee cannot be held to be a charitable trust within the meaning of section 2(15) of the Act. On appeal by the assessee, the Appellate Assistant Commissioner has confirmed the order of the Income-tax Officer. On further appeal to the Tribunal, it has held that from the terms of the trust deed, it is clear that the business of running the printing press itself is held as trust and therefore the income from the business, that is, the sum of Rs. 18,628 should be taken to fall within the exemption under section 11 of the Act. Aggrieved by the view taken by the Tribunal, the Revenue has sought and obtained a reference on the question set out above.

(3.) IN this case also, the business of printing press which was run by the founder of the trust has been endowed as a trust for the purpose of conducting the charitable objects referred to in the trust deed. It is not in dispute that the objects in the trust deed will come within the definition of "charitable purpose" in section 2(15). Hence the decision of the Supreme Court will squarely apply to the facts of the present case. IN this view of the matter, we have to answer and we accordingly answer the question referred to us in the affirmative and against the Revenue. The Revenue will pay the costs of the assessee-counsel's fee Rs. 500 (Rupees five hundred only).