Commercial Activities by Trust registered u/s 12AB

[Mratunjaya Vajramatti]

Dear sir/madam

A trust registered u/s 12AB running an ayurvedic college and a teaching hospital under it. Teaching hospital gives services and also sells drugs to inpatients.

Suppose Trust plans to opens a medical shop within the premises of college and to extend sale of drugs and other pharmaceutical products to outsiders. can a trust do that??

AI Summary

Trust Operating Ayurvedic College Plans Medical Shop; Supreme Court Ruling May Impact Charitable Status. Review Objects Clause. A trust registered under section 12AB operates an ayurvedic college and a teaching hospital, providing services and selling drugs to inpatients. The trust is considering opening a medical shop to sell pharmaceuticals to outsiders. The main objective of the trust is education, with 75 institutions. It is noted that there is no restriction on commercial activities if the primary purpose is education. However, the Supreme Court's decision in the case of New Noble Educational Society is relevant for determining the charitable nature of such activities. The objects clause of the trust should be carefully reviewed.