Educational activity exemption upheld where book publishing was treated as intrinsically connected with education and section 2(15) did not apply.

Printing and publishing books was treated as intrinsically connected with education where the books were used for educational and value-oriented purposes. On that basis, the activity was regarded as educational rather than advancement of any other object of general public utility, so the proviso to section 2(15) was held inapplicable. The trust was therefore entitled to exemption under sections 11 and 12, and the related accumulation benefit under section 11(2) could not be denied. Consistency with acceptance of the same claim in earlier and later years also supported the charitable character of the activity.

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Issues: Whether the assessee trust carrying on printing and publication of books was engaged in an educational activity eligible for exemption under sections 11 and 12 of the Income-tax Act, 1961, and whether the proviso to section 2(15) applied so as to deny the exemption and the benefit of accumulation under section 11(2).

Analysis: The activity of printing and publishing books was found to be intrinsically connected with education, especially when the books were stated to be used for educational and value-oriented purposes. The surrounding facts, including acceptance of the assessee's claim in earlier and subsequent years on similar scrutiny, supported consistency in approach. Since the assessee was held to be carrying on educational activity and not advancement of any other object of general public utility, the proviso to section 2(15) was held inapplicable. Once the activity was treated as educational, denial of exemption under sections 11 and 12, including accumulation under section 11(2), could not stand.

Conclusion: The assessee was held entitled to exemption under sections 11 and 12, and the denial of benefit on the ground of section 2(15) was rejected.

Final Conclusion: The orders of the lower authorities were reversed and the assessee's charitable exemption claim, including accumulation relief, was restored.

Ratio Decidendi: Printing and publication of books, when intrinsically connected with education, constitute an educational activity and not an activity falling within the proviso to section 2(15), entitling the assessee to exemption under sections 11 and 12.

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