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Issues: Whether the income of the trust was entitled to exemption under section 11(1)(a) of the Income-tax Act, 1961, read with section 2(15) of that Act, for the assessment year 1962-63.
Analysis: The definition of "charitable purpose" in section 2(15) was held to restrict only the residuary head, namely, advancement of any other object of general public utility, by the words "not involving the carrying on of any activity for profit". Those words were not treated as qualifying relief of the poor, education, or medical relief. A business undertaking was regarded as an activity for profit, and where a trust for general public utility necessarily involved running a newspaper business, it ceased to be charitable under the Act. The trust's main object of supplying an organ of educated public opinion was held to be outside the head of education and to involve commercial activity.
Conclusion: The trust was not entitled to exemption under section 11(1)(a) read with section 2(15) of the Income-tax Act, 1961, and the answer to the reference was against the assessee and in favour of the Revenue.
Ratio Decidendi: The words "not involving the carrying on of any activity for profit" qualify only the residuary category of general public utility, and a trust whose object necessarily involves a commercial business activity does not fall within the statutory definition of charitable purpose.
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