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TMI Blog1998 (6) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... also, to improve the conduct and knowledge of the students ; (Corrigendum : It was resolved unanimously in the general body meeting convened on August 29, 1953, to amend clause (b) as follows : To convert Board schools into special schools or branch schools ; to found and improve ladies college and ladies training school ; and to improve the conduct and knowledge). (c) To administer and improve the properties mentioned in the schedule ; (d) To construct buildings in the lands belonging to the Board ; and to change, modify or remove the existing buildings ; (e) To get immovable properties like land, buildings, etc., or movable properties on lease basis or to purchase them, that are necessary for the Board ; (f) Powers of the member ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case of Aditanar Educational Institution v. Addl. CIT [1997] 224 ITR 310, wherein the Supreme Court laid down the following test to determine when the institution would qualify for exemption under section 10(22) of the Act : "We may state that the language of section 10(22) of the Act is plain and clear and the availability of the exemption should be evaluated each year to find out whether the institution existed during the relevant year solely for educational purposes and not for purposes of profit. After meeting the expenditure, if any surplus results incidentally from the activity lawfully carried on by the educational institution, it will not cease to be one existing solely for educational purposes since the object is not one to mak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ucational Institution's case [1997] 224 ITR 310, held that a distinction/difference should be made between the corpus, objects and powers of the trustees. When the distinction between the objects and powers are kept in mind, clauses (c) to (e) are only powers of the trustees which is made explicit by clause (f). That apart, clause 3(g) of the trust deed also makes it clear that the income from the properties should be utilised to implement the objects mentioned in clauses 3(a) and 3(b). Therefore, we are of the view, the object of the trust is education and it is not to make profit. As held by the Supreme Court the acid test is whether the object is to make profit. But, in construing the objects, one has to weed out the powers of the truste ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Kerala High Court in CIT v. Sree Narayana Chandrika. Trust [1995] 212 ITR 456 and Brahmin Educational Society v. Asst. CIT [1997] 227 ITR 317, held that the question of eligibility to exemption under section 10(22) of the Act has to be decided with reference to the objects of the society and if the trust, in order to attain its main object, conducts some business for raising the funds, the claim for exemption under section 10(22) of the Act would still be available to the trust. The distinction between the objects of the trust and the powers of the trustees has been applied by the Kerala High Court in the above two decisions. We are in respectful agreement with the view expressed by the Kerala High Court in the above two decisions. Fol ..... X X X X Extracts X X X X X X X X Extracts X X X X
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