1975 (8) TMI 41

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....relief within the meaning of section 2(15) of the Income-tax Act, 1961 ?" The assessee is a trust constituted by one Sri Alur Laxminarayana Rao by a deed, dated 17th March, 1958. The author of the trust settled a sum of Rs. 5,000 on trust for the objects set forth in the said deed. Clause 4 of the deed sets out the objects as follows: "(a) The benefits from the trust shall be open to all persons irrespective of caste, community or religion. (b) Awarding scholarships to deserving students. The scholarships may be given by way of loan or outright gratuity not returnable and/or partly by way of loan and partly by way of gift or gratuity or in any other manner appropriate to the situation. (c) To pay or advance for medical relief....

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....e, the assessee was not entitled to the exemption contemplated in section 11 of the Act. The Appellate Assistant Commissioner upheld the view of the Income-tax Officer. On further appeal by the assessee, the Tribunal held that the assessee was a charitable trust as defined in section 2(15) of the Income-tax Act, 1961, that it was a genuine trust and that it was entitled to the exemption in section 11 of the Act. The Tribunal found that up to the year 1971, the assessee had applied a sum of Rs. 5,25,000 for charitable purposes. The Tribunal discussed the material placed before it in this behalf and recorded the said finding in paragraph 10 of its order. It thus rejected the contention on behalf of the department that there was no genuine ....

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....of the first three above categories, the court will assume it to be for the benefit of the community and charitable unless the contrary is shown. In the case of new or unfamiliar categories of purposes which fall under the 4th category, viz., the advancement of any other object of general public utility, the question whether or not the purpose is for the benefit of the community has to be considered by the court as to whether it is for a charitable purpose. In regard to the residuary head of charitable purpose, Parliament has restricted the scope of that head by providing that in order to fall under the residuary head of 'general public utility' it should not involve the carrying on of any activity for profit. A business undertaking is an a....