Charitable trust by clear intention and ejusdem generis construction can sustain exemption where objects are sufficiently definite.

A charitable trust may be created without a formal deed where the donor's words clearly show an intention to dedicate property for charitable purposes, followed by divestment and vesting in trustees; on the facts, the donor's letter and the subsequent payment and investment in the assessee's name established a valid trust for that amount. The phrase "such similar philanthropic objects" was construed ejusdem generis with the preceding specific charitable objects, so the trust purposes were not too vague. The trust was therefore treated as validly created, its objects as sufficiently definite and charitable, and exemption was available.

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Issues: Whether a valid charitable trust was created out of the amounts paid pursuant to the donor's letter, and whether the trust objects were too vague to qualify for exemption under the relevant income-tax provision.

Analysis: A charitable trust may be created without a formal instrument if the donor's words clearly manifest an intention to dedicate property for charitable purposes, followed by divestment of ownership and vesting in the trustee. The donor's letter showed a definite charitable intention, and the subsequent payment and investment of Rs. 60,000 in the assessee's name established a valid trust for that amount, even though the letter referred to a larger intended gift. The expression "such similar philanthropic objects" was read in the context of the preceding charitable purposes and construed ejusdem generis. The dominant intention was to support objects similar to the establishment of medical or educational institutions, so the objects were not vague.

Conclusion: The trust was validly created, the objects were charitable and sufficiently definite, and the assessee was entitled to exemption.

Final Conclusion: The reference was answered in favour of the assessee, and the claimed tax refund relief followed from the validity of the charitable trust.

Ratio Decidendi: A charitable trust can be validly created by clear words and subsequent divestment without a formal deed, and a qualifying charitable purpose is not rendered vague where general expressions are controlled by preceding specific charitable objects on the principle of ejusdem generis.

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