Educational activity can qualify as an occupation for tax exemption even without profit motive, the court held.

Expenditure incurred wholly and exclusively for a business, profession, vocation or occupation is exempt under section 5(a) of the Expenditure-tax Act, and the provision is not confined to profit-making activities. The income element cannot be read into that category, so an activity may still qualify as a vocation or occupation even if carried on for social service or public good without remuneration. On the facts, running educational institutions was a regular and substantive activity, and it was properly characterised as an occupation. The expenditure incurred for that educational activity therefore fell within the exemption.

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Issues: Whether the respondent's educational activities amounted to a business, profession, vocation or occupation within section 5(a) of the Expenditure-tax Act, 1957, so as to exempt the expenditure incurred wholly and exclusively for that activity.

Analysis: The exemption in section 5(a) is not confined to activities undertaken with a profit-making motive. The language of the provision separates expenditure incurred for a business, profession, vocation or occupation from expenditure incurred for earning income from any other source, and the income element cannot be imported into the former category. An activity may amount to a vocation or occupation even if it is carried on for social service or public good and does not yield remuneration. On the facts, the respondent's work in running educational institutions was a regular and substantive activity and could properly be characterised as an occupation.

Conclusion: The respondent's educational activities amounted to an occupation within section 5(a), and the expenditure incurred for that activity was within the exemption.

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