Hospital Pharmacy Surplus Exemption Upheld; Entitled to 15% Deduction on Gross Receipts u/s 11(1)(a.

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....Exemption u/s 11 for surplus arising from a pharmacy store run by a hospital, and the deduction of 15% on gross receipts u/s 11(1)(a). Regarding the pharmacy store, it was held that running a pharmacy is incidental to the main objects of running a hospital and research center, and hence not hit by Section 11(4A). The pharmacy store serves only admitted patients, not outsiders, and is an integral part of the assessee's activities. This issue was already decided in the assessee's favor by the ITAT and the jurisdictional High Court. Concerning the deduction u/s 11(1)(a), it was held that the assessee is entitled to claim a deduction of 15% on gross receipts, as per the Supreme Court's decision in Programme for Community Organisation. The deduction is to be calculated on gross receipts and not on surplus or deficit, without any condition imposed by Section 11(1)(a).....