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TMI Blog1989 (9) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... s 11 of the Act to the assessee as the object of the assessee are political." As is evident from the ground raised by the Revenue the revenue's contention merely is that the assessee is not a charitable institution. 3. The assessee is a trust society established by the late Lala Lajpat Rai, a great national leader and freedom fighter, somewhere in the year 1921 and has all along been treated as a charitable institution. The objects of the assessee society are narrated in para 4 of its constitution as below :--- " 4. The object of the society shall be to enlist and train national missionaries for the service of the motherland. It shall be their duty to work for the educational, cultural, social, economic and political advancement of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1973-74 to 1979-80. 5. The Revenue had come to this Tribunal against the orders of the CIT(A) for assessment years 1973-74 to 1979-80. The appeal for assessment year 1973-74, being I.T.A. No. 2857 (Del)/85 was decided by a Bench of this Tribunal vide order dated 23-6-1989 and was dismissed. The appeals for assessment years 1974-75 to 1979-80, being I.T.A. Nos.2858 to 2863 (Del)/85 were also decided on the same date and were dismissed following the order in ITA No. 2857/85. 6. At the hearing before us while the learned Departmental Representative did not argue the matter as he felt that the matter stood already covered, the learned counsel for the assessee argued the matter at some length as he felt that in the earlier orders of the Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of Hon'ble the Privy Council in the case of Trustees of the Tribune, In re [1939] 7 ITR 415, in which a person, who owned a press and a newspaper, created a trust by his will by which his property in the stock and goodwill of the press and newspaper was made to vest permanently in a committee of certain members. The surplus income of the press was to be utilised for the maintenance of a college. It was held that the object of the settlor was to supply the province with an organ of an educated public opinion and was prima facie an object of general public utility and the fact that the paper may have, or may acquire, a political complexion could not take away its exemption. 9. On the basis of these rulings the learned counsel for the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... people of their political rights and telling them how to exercise and defend them. All activities directed towards that end would be activities of general public utility and, thus of a charitable nature. If it were not so, a department in a college or a university that teaches political science could be said to be indulging in activity, which is neither charitable nor of general public utility. We, therefore, are of the opinion that the use of the word 'political advancement' in the objects clause is itself a charitable object and not a political object devoid of character as an activity of charitable nature or of general public utility. 10. As regards the publication of newspaper --- Samaj is concerned, that is not being done by the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f of poor, education and medical relief. It was so held by Hon'ble the Supreme Court in CIT v. DharmodayamCo.[1977] 109 ITR 527. In that case it was held that a business, which is held in trust, cannot by reason of the amendment become a business started for the purpose of advancing an object of general public utility. In that case the assessee was running a chit fund business, which itself was held under trust for religious or charitable purposes. The Hon'ble Supreme Court, therefore, held that the said business was not carried on in the execution of a charitable purpose. 12. Reliance was also placed by the learned counsel for the assessee on Addl. CIT v. Surat Art Silk Cloth Mfrs. Association [1980] 121 ITR 1 (SC) in which the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... legislature amended sec. 13 by adding to sub-section (1) clause (bb) as follows :--- "13(1). Nothing contained in sec. 11 or sec. 12 shall operate so as to exclude from the total income of the previous year of the person in receipt thereof --- (bb) in the case of a charitable trust or institution for the relief of the poor, education or medical relief, which carries on any business, any income derived from such business, unless the business is carried on in the course of the actual carrying out of a primary purpose of the trust or institution." Thus, by virtue of this clause exemption would be denied to a charitable trust which carries on any business even if such business does not arise out of the advancement of an object of general ..... X X X X Extracts X X X X X X X X Extracts X X X X
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