Charitable purpose excludes activities carried on for profit, removing tax exemption when profit motive exists under income tax law. Section 2(15) excludes activities involving the carrying on of any activity for profit from the definition of charitable purpose. The Supreme Court set a two-step test-(1) whether the object is of general public utility and (2) whether its advancement involves activities carried on for profit or without profit-and held that an affirmative finding of profit-oriented activity removes entitlement to exclusion from total income. Tax officers are directed to review completed cases under this test and report results to the Board.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Charitable purpose excludes activities carried on for profit, removing tax exemption when profit motive exists under income tax law.
Section 2(15) excludes activities involving the carrying on of any activity for profit from the definition of charitable purpose. The Supreme Court set a two-step test-(1) whether the object is of general public utility and (2) whether its advancement involves activities carried on for profit or without profit-and held that an affirmative finding of profit-oriented activity removes entitlement to exclusion from total income. Tax officers are directed to review completed cases under this test and report results to the Board.
Full Summary is available for active users!
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
of 
TaxTMI 
