INCOME TAX ACT, 1961

Section 11

Charitable trust - Exemption under section 11 - Applicability of proviso to section 2(15) - Assessee engaged in providing medical relief to public also doing kuri business

Assessee-trust registered under section 12AA was running a hospital as a charity and was also doing kuri business stated to be for the purpose of charity. It declared nil taxable income after claiming exemption under section 11. AO held that income from kuri business could not be considered as for accomplishment of object of charitable activities in terms of section 2(15). Main object of kuri business was to earn profit and was not incidental to charitable activities and, therefore, assessee was not entitled to exemption under section 11.Held: Admittedly, assessee was engaged in the activity of providing medical relief to public and kuri business could not be considered done in the course of carrying on primary objects of assessee-Trust. Activity carried on by assessee in the form of kuri business was hit by proviso to section 2(15) and,therefore, assessee- trust could not claim exemption under section 11.

REFERRED :

FAVOUR : Against the assessee.

A.Y. :

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