Appeals Nos
946 of 1963
Appeals from the judgment dated February 22 1961 of the Madras High Court in Case Referred No 121 of 1956
K N Rajagopal Sastri R H Dhebar and R N Sachthey for the appellant in all the appeals
A V Viswanatha Sastri K Rajendra Chaudhuri and K R Chaudhuri for the respondent in all the appeals
The Judgment of the Court was delivered by Shah J
The Andhra Chamber of Commerce hereinafter called the assessee s a Company incorporated under the Indian Companies Act 7 of 1913
The assessee was permitted under section 26 of the Act to omit the word Limited from its name by order of the Government of Madras
The following are the principal objects of the Memorandum of Association of the assessee  a To promote and protect trade commerce and industries of India in the Province of Madras and in particular in the Andhra country
b To aid stimulate and promote the development of trade commerce and industries in India or 567 any part thereof with capital principally provided by Indians or under the management of Indians
c To watch over and protect the general commercial interests of India or any part thereof and the interests of the Andhras in particular engaged in trade commerce or manufacture in India and in particular the Andhra Desa
y To do all such other things as may be conducive to the preservation and extension of trade commerce industries and manufactures or incidental to the attainment of the above objects or any of them
Clauses d to x are incidental to the principal objects
By cl 4 of the Memorandum of Association it was provided that the income and property of the assessee shall be applied solely towards the promotion of its objects as set forth therein and no portion thereof shall be paid or transferred directly or indirectly by way of dividends bonuses or otherwise howsoever by way of profit to its members
On December 2 1944 the assessee purchased a building and made substantial alterations additions and improvements therein
The assessee then moved its offices into that building on May 14 1947 and let out to tenants the portion not required for its use
The income of the assessee is obtained from subscriptions and donations collected from its members and rent received from the building
The following table sets out in columns 3  4 the net annual value of the property less the statutory deductions permissible under section 9 of the Income tax Act 1922 and the net excess of expenditure over the income of the assessee other than the rental income incurred in connection with all its activities for the assessment years relating to which dispute arises in this group of appeals Previous year Assessment Amount Net excess calendar year year Rs Rs 1 2 3 4 1947 1948 49 3400 7431 1948 1949 50 6154 7139 1949 1950 51 6928 5266 1950 1951 52 5740 10173 1952 1953 54 8072 13672 1953 1954 55 8072 17397 In proceedings for assessment before the Second Additional Income tax Officer City Circle 1 Madras it was contended that Sup65 11 568 the annual value of the building was not assessable in its hands as the assessee was a charitable institution within the meaning of section 43 i of the Income tax Act 1922
In the alternative it was contended that the excess of expenditure over income should be set off against such income if the annual value is held assessable
The Income tax Officer rejected the contentions of the assessee and assessed its income from property on the basis of net annual value in the six assessment years without debiting the expenditure in excess of income other than rent against the net annual value
The assessee appealed to the Appellate Assistant Commis sioner against all the orders of assessments
The Appellate Assistant Commissioner held that the assessee not being a charitable institution the income in question was not exempt under section 43 i
He also rejected the alternative contention for in his view there was no specific profit making activity of the assessee the loss from which could be set off against its other income
Appeals were then taken to the Income tax Appellate Tribu nal
The Tribunal held that the assessee was not exempt within the meaning of section 43 i from liability to pay income tax because the activities of the assessee were intended for the benefit primarily of its members and embraced only collective action on behalf of all its constituent members which could not be said to be the result of any trade or business or vocation carried on by it
At the instance of the assessee the Tribunal referred the following questions to the High Court  1 Whether the aforesaid income from property owned by the assessee is exempt under section 4 3 i for the aforesaid six years of assessment  2 If the answer to the above question is in the negative whether the activities of the assessee amount to a trade or business the profit or loss from which is assessable under section 10  The High Court answered the first question in the affirmative and did not record a formal answer on the second question
Against the order of the High Court these appeals are preferred by the Commissioner of Income tax with certificate granted by the High Court under section 66A 2 of the Indian Income tax Act
We are concerned in this group of appeals with the assess ment of income of the assessee in the years 1948 49 to 1954 55 569 with the omission of the assessment year 1952 53
Between the years 1948 49 to 1952 53 there has been some change in section 43 i which before it was amended by Act 25 of 1953 with effect from April 1 1952 read as follows  Any income profits or gains falling within the following classes shall not be included in the total income of the person receiving them  i Any income derived from property held under trust or other legal obligation wholly for religious or charitable purposes and in the case of property so held in part only for such purposes the income applied or finally set apart for application thereto By the last paragraph of sub section 3 charitable purpose was defined as including relief of the poor education medical relief and the advancement of any other object of general public utility but nothing contained in cl
i or cl
i or cliaor cl
ii shall operate to exempt from the provisions of the Act that part of the income of a private religious trust which does not enure for the benefit of the public
By the amendment made by section 3 of the Indian Income tax Amendment Act 25 of 1953 cls
i and i a as they originally stood were amalgamated
It is common ground that by the amendment no alteration which has a material bearing on the question to be decided in these appeals has been made
Income from property qualifies for exemption under section 43 i if two conditions co exist i the property is held under trust or other legal obligation and ii it is so held wholly or in part for religious or charitable purposes 
The building which the assessee owns is by virtue of cl 4 of the Memorandum of Association held under a legal obligation to apply its income to purposes specified in the Memorandum of Association
It is not the case of the assessee that the objects of incorporation are relief of the poor education or medical relief and the only question canvassed at the Bar is whether the purposes for which the assessee stands incorporated are objects of general public utility within the meaning of the expression charitable purpose in section 43
The principal objects of the assessee are to promote and protect trade commerce and industries and to aid stimulate and promote the development of trade commerce and industries in India or any part thereof
By the achievement of these objects it is not intended to serve merely the interests of the members of 570 the assessee
Advancement or promotion of trade commerce and industry leading to economic prosperity enures for the benefit of the entire community
That prosperity would be shared also by those who engage in trade commerce and industry but on that account the purpose is not rendered any the less an object of general public utility
It may be remembered that promotion and protection of trade commerce and industry cannot be equated with promotion and protection of activities and interests merely of persons engaged in trade commerce and industry
In Commissioners of Inland Revenue vs Yorkshire Agricultural Society1 an association called the Yorkshire Agricultural Society was formed with the object of holding annual meetings for the exhibition of farming stock implements etc
 and for the general promotion of agriculture
All prizes were open to competition in the United Kingdom but certain privileges were attached to membership of the Society
The income of the Society was derived from entry fees and gate receipts local subscriptions for prizes interest on investments and subscriptions of members
It was held by the Court of Appeal that on the facts found by the Commissioners the Society was established for a charitable purpose and that purpose continued notwithstanding the incidental benefits enjoyed by members of the Society and that those benefits did not prevent the
Society from being established for a charitable purpose only
In Halsbury s Laws of England 3rd Edn Vol 4 at p 236 Art 517 it is stated An association or institution may benefit its members in the course of carrying out its main charitable purpose and this alone will not prevent it from being a charity
It is a question of fact whether there is so much personal benefit intellectual or professional to the members of a society or body of persons as to be incapable of being disregarded In The Institution of Civil Engineers vs The Commissioners of Inland Revenue 2 it was held that the Institution of Civil Engineers founded and incorporated by Royal Charter for the general advancement of mechanical science and more particularly for promoting the acquisition of that species of knowledge which constitutes the profession of a civil engineer was a body of persons established for charitable purposes only
The Special Commissioners having regard in particular to the provisions of the supplemental charter of 1922 by which the corporate members 1 2 571 of the Institution were authorised to use the title of member or associate member as the case might be found that a substantial part of the objects of the Institution was to benefit the member  and rejected the claim of the Institution for exemption
The Court of King s Bench disagreeing with the Special Commisssioners held that the benefit of members was purely incidental to the main purpose of the Institution which was established for charitable purposes only
The Court of Appeal found that the only purpose for which the Institution was established was the promotion of science and that purpose had never been added to or varied by any of the supplemental charters  it followed therefore that the Institution was established for charitable purposes only notwithstanding that it is of advantage to a civil engineer in his profession to be a member of the Institution this result not being a purpose for which the Institution was established but being incidental to and consequent upon the way in which the Institution carries out the charitable purpose for which alone it was established
In the promotion of trade commerce and industries of India the public is vitally interested and if by the activities of the assessee that object is achieved it would be within the meaning of section 43 1 of the Act an advancement of an object of general public utility
In enacting the last paragraph of section 43 the legislature has used language of great amplitude
Charitable purpose includes not only relief of the poor education and medical relief alone but advancement of other objects of general public utility as well
The clause is intended to serve as a special definition of the expression charitable purpose for the Act  it is again inclusive and not exhaustive or exclusive
Even if the object or purpose may not be regarded as charitable in its popular signification as not tending to give relief to the poor or for advancement of education or medical relief it would still be included in the expression charitable purpose if it advances an object of general public utility
The expression object of general public utility however is not restricted to objects beneficial to the whole mankind
An object beneficial to a section of the public is an object of general public utility
To serve a charitable purpose it is not necessary that the object should be to benefit the whole of mankind or even all persons living in a particular country or Province
It is sufficient if the intention be to benefit a section of the public as distinguished from specified individuals
Observations to the contrary made by Beaumont CJ in Commissioner of Income tax Bombay Presi 572 dency Sind and Baluchistan vs The Grain Merchants  Association of Bombay1 that an object of general public utility means an object of public utility which is available to the general public as distinct from any section of the public and that objects of an association to benefit works of public utility confined to a section of the public ie those interested in commerce are not objects of general public utility do not correctly interpret the expression objects of general public utility
The section of the community sought to be benefited must undoubtedly be suffi ciently defined and identifiable by some common quality of a public or impersonal nature where there is no common quality uniting the potential beneficiaries into a class it may not be regarded as valid
It is true that in this case there is in fact no trust in respect of the income derived from the building owned by the assessee
But the property and the income therefrom is held under a legal obligation for by the terms of the permission granted by the Government to the assessee to exclude from its name the use of the word limited and by the express term of cl 4 of the Memorandum of Association the property and its income are not liable to be utilised only for the purposes set out in the Memorandum of Association
Counsel for the revenue submitted that the purposes of the assessee are vague and indefinite
He submitted that if a competent Court were called upon as it may be called upon to administer the obligation imposed by the Memorandum of Association the Court would on account of vagueness of the objects decline to do so and therefore the purposes cannot be regarded as charitable
In the alternative counsel contended that the benefit which is contemplated by the Memorandum of Association was not the benefit to the public generally but the benefit to its members to carry on their business more profitably
In the further alternative relying upon cl 3g of the Memorandum of Association counsel contended that the objects of the assessee were political it being open to the assessee to appropriate the entire income for political purposes
But the primary objects of the assessee are to promote and protect trade commerce and industries and to aid stimulate and promote the development of trade commerce and industries and to watch over and protect the general commercial interests of India or any part thereof
These objects are not vague or inde 1 573 finite as objects of general public utility
An object of general public utility such as promotion protection aiding and stimulation of trade commerce and industries need not to be valid specify the modus or the steps by which the objects may be achieved or secured
It cannot be said that if called upon to administer an institution of which the objects are of the nature set out the Court would decline to do so merely on the ground that the method by which trade commerce or industry is to be promoted or protected aided or stimulated or the general commercial interests of India are to be watched over or protected are not specified
Analogy of cases like Runchordas Vandra wandas vs Parvati Bhai1 in which the Privy Council declared a devise under a will in favour of dharam void is misleading
In that case the devise was declared void because the expression dharam in the view of the Judicial Committee being law virtue legal or moral duty was too general and too indefinite for the courts to enforce
Observations by Lord Simonds in Commissioners of Inland Revenue vs National Anti Vivisection Society2 that One of the tests and a crucial test whether a trust is charitable lies in the competence of the Court to control and reform it   that it is the King as parens patriae who is the guardian of charity and that it is the right and duty of his Attorney General to intervenue and to inform the Court if the trustees of a charitable trust fall short of their duty
So too it is his duty to assist the Court if need be in the formulation of a scheme for the execution of a charitable trust
But  is it for a moment to be supposed that it is the function of the Attorney General on behalf of the Crown to intervene and demand that a trust shall be established and administered by the Court the object of which is to alter the law in a manner highly prejudicial as he and His Majesty s Government may think to the welfare of the State  do not assist the case of the revenue
In the view of Lord Simonds the object of the trust was political and therefore void and not because it was vague or indefinite
In Baddeley and others Trustees of the Newtown Trust vs Commissioners of Inland Revenue certain properties were conveyed to trustees by two conveyances in one case on trust inter alia for the promotion of the religious social and physical well being of persons resident in the County Boroughs of West Ham and Leyton by the provision of facilities for religious 1 LR 26 IA 71
2  367
3 574 services and instruction and for the social and physical training and recreation of such aforementioned persons who were members or likely to become members of the Methodist Church and of insufficient means otherwise to enjoy the advantages provided and by promoting and encouraging all forms of such activities as were calculated to contribute to the health and well being of such persons and in the other case on similar trusts omitting reference to religious services and instruction and otherwise substituting moral for religious
These trusts were it was held not for charitable purposes only
The case arose under the Stamp Act of 1891 and it was contended that the trusts being charitable stamp duty at a lower rate was chargeable
The House of Lords held that the trust was not charitable
It was observed by Lord Simonds that the moral social and physical well being of the community or any part of it is a laudable object of benevolence and philanthropy but its ambit is far too wide to include purposes which the law regards as charitable
These cases have in our judgment no bearing on the inter pretation of the language used in the Memorandum of Associa tion of the assessee
The argument that it is only for the benefit of the members or the trading classes in Andhra Desa that the funds of the assessee could be utilised does not stand scrutiny
It is clear from the diverse clauses in paragraph 3 of the Memorandum of Association that the objects were not merely to benefit the members of the assessee or even the trading community of Andhra Desa
Reliance was placed upon the membership clause in the Articles of Association and it was submitted that only persons speaking Telugu language and residing in Andhra Desa as defined in cl 1 s of the Articles of Association could be members
But that argument is wholly unfounded
By sub cl
iii of cl 5 a Chamber of Commerce or Trade Association protecting and promoting Indian trade commerce and industry is eligible for election as a member of the Chamber and the representative of such a Chamber of Commerce or Trade Asso ciation need not necessarily be able to speak and write Telugu
Similarly by sub cl
iv a Company or Corporation having its principal office or registered office in Andhra Desa or a branch in Andhra Desa is eligible to become a member in its conventional or corporate name and the representative of such a Company or Corporation need not necessarily be able to speak or write Telugu
Again under sub cl
v a Partner of a Firm of a Private Partnership Concern or a Joint Family Business 575 concern or a Sole Proprietory concern having its principal office or registered office in Andhra Desa or a branch in Andhra Desa is eligible for membership of the Chamber and the representative of such a member need not necessarily be able to speak or write Telugu
Finally by sub cl
vi an individual residing anywhere in India and connected in any manner with trade industry and commerce is eligible for membership of the Chamber provided his mother tongue is Telugu or he can both speak and write Telugu
There is no geographical limitation upon the membership qualification nor is there limitation about the capacity to speak or write Telugu
We should not be taken as holding that if there were such restrictions the character of the assessee as an institution for promotion of charitable objects would thereby be necessarily effected
Clause 3g of the Memorandum of Association on which strong reliance was placed reads as follows  To urge or oppose legislative and other measures affecting trade commerce or manufactures and to procure change of law and practice affecting trade commerce and manufactures and in particular those affecting trade commerce and industries in which Andhras are concerned and obtain by all acknowledged means the removal as far as possible of all grievances affecting merchants as a body and mercantile interests in general
 But cl 3g is not the primary object of the assessee  it is merely incidental to the primary objects of promotion or protection of trade commerce and industries or to aid stimulate and promote the development of trade commerce and industries or to watch over and protect the general commercial interests
The expression object of general public utility in section 43 would prima facie include all objects which promote the welfare of the general public
It cannot be said that merely a purpose would cease to be charitable even if public welfare is intended to be served thereby if it includes the taking of steps to urge or oppose legislation affecting trade commerce or manufacture
If the primary purpose be advancement of objects of general public utility it would remain charitable even if an incidental entry into the political domain for achieving that purpose eg promotion of or opposition to legislation concerning that purpose is contemplated
In In re The Trustees of the Tribune1 the 1 576 Judicial Committee of the Privy Council was called upon to consider whether a trust created under a will to maintain a printing press and newspaper in an efficient condition and to keep up the liberal policy of the newspaper devoting the surplus income of the press and newspaper after defraying all current expenses in improving the newspaper and placing it on a footing of permanency and further providing that in case the paper ceased to function or for any other reason the surplus of the income could not be applied to the object mentioned above the same should be applied for the maintenance of a college which had been established out of the funds of another trust created by the same testator was a charitable purpose within the meaning of section 43
The Judicial Committee expressed the view that the object of the settler was to supply the province with an organ of educated public opinion and this was prima facie an object of general public utility and observed These English decisions are in point in so far only as they illustrate the manner in which political objects in the wide sense which includes projects for legislation in the interests of particular causes affect the question whether the Court can regard a trust as being one of general public utility
In the original letter of reference it was not suggested by the Commissioner that the newspaper was intended by its founder to be a mere vehicle of political propaganda and in the case of Sardar Dyal Singh it seems unrea sonable to doubt that his object was to benefit the people of Upper India by providing them with an English newspaper the dissemination of news and the ventilation of opinion upon all matters of public interest
While not perhaps impossible it is difficult for a newspaper to avoid having or acquiring a particular political complexion unless indeed it avoids all reference to the activities of Governments or legislatures or treats of them in an eclectic or inconsistent manner
The circumstances of Upper India in the last decade of the nineteenth century would doubtless make any paper published for Indian readers sympathetic to various movements for social and political reform
But their Lordships having before them material which shows the character of the newspaper as it was in fact conducted in the testator s lifetime have arrived at the conclusion that questions of politics and legislation 577 were discussed only as many other matters were in this paper discussed and that it is not made out that a political purpose was the dominant purpose of the trust
 In All India Spinners  Association vs Commissioner of Incometax Bombay1 the assessee was formed as an unregistered association by a resolution of the All India Congress Committee for the development of village industry of hand spinning and hand weaving
The Association was established as an integral part of the Congress Organisation but it had independent existence and powers unaffected and uncontrolled by politics
The objects of the Association amongst others were to give financial assistance to khaddar organisations by way of loans gifts or bounties to help or establish schools or institutions where handspinning is taught to help and open khaddar stores to establish a khaddar service to act as agency on behalf of the Congress to receive self spun yarn as subscription to the Congress and to issue certificates and to do all the things that may be considered necessary for the furtherance of its objects with power to make regulations for the conduct of affairs of the Association of the Council and to make such amendments in the present constitution as may be considered from time to time
The funds of the Association consisted mostly of donations and subscriptions and out of the funds charkas and handlooms were purchased and supplied to the inhabitants free of charge
Raw cotton was supplied to the poor people to be spun into yarn and the yam so spun along with the yam acquired by the Association were supplied to other poor people for hand weaving
The income of the Association was treated by the Commissioner of Incometax as not exempt under section 43 i of the Indian Income tax Act inasmuch as i the dominant purpose of the Association was political ii even assuming it was not political the dominant purpose was not in any event a valid charitable purpose in law and iii some of the objects were not clearly charitable objects
The Judicial Committee held that the income of the Association was derived from property held under trust or other legal obligation wholly for charitable purposes and the English decisions on the law of charities not based upon any definite and precise statutory provisions were not helpful in construing the provisions of section 43 i of the Indian Income tax Act
The words of section 43 were largely influenced by Lord Macnaghten s definition of charity in Pemsel vs Commissioners for Special Purposes of Income Tax 2  but that definition had no statutory 1 2 578 authority and was not precisely followed in the most material particulars the words of the section being for the advancement of any other object of general public utility and not as Lord Macnaghten said other purposes beneficial to the community
The Judicial Committee observed that the primary object of the Association was relief of the poor and apart from that ground there was good ground for holding that the purposes of the Association included advancement of other purposes of general public utility
The Judicial Committee then held  These words their Lordships think would exclude the object of private gain such as an undertaking for commercial profit though all the same it would sub  serve general public utility
But private profit was eliminated in this case
Though the connexion in one sense of the Association with Congress was relied on as not consistent with general public utility  because it might be for the advancement primarily of a particular party it is sufficiently clear in this case that the Association s purposes were independent of and were not affected by the purposes or propaganda of Congress The Indian legislature has evolved a definition of the ex pression charitable purpose which departs in its material clause from the definition judicially supplied in Pemsel s case1 and decisions of English Courts which proceed upon interpretation of language different from the Indian statute have little value
We therefore do not propose to deal with the large number of English cases cited at the Bar except to mention three which declared trusts for political purposes invalid
In Rex vs The Special Commissioners of Income tax ex parte The Headmasters  Conference and Rex vs The Special Com missioners of Income Tax ex parte The Incorporated Association of Preparatory School1 it was held that a conference of Headmasters incorporated under the Companies Act as an Association limited by guarantee of which under the Memorandum of Association income was to be applied towards the promotion of its expressed objects one of which was the promotion of or opposition to legislative or administrative educational measures the holding of examinations etc
was not a body of persons established for charitable purposes only within the meaning of the Income Tax Acts
Similarly an incorporated Association of Preparatory Schools incorporated under the Companies Act as an Association limited by guarantee income 1  2 579 whereof was to be applied solely towards the promotion of its expressed objects which included the advancement and promotion of or opposition to legislative or administrative educational measures etc
was not an association whose income was applicable to charitable purposes only
The Court of King s Bench held in the case of each of the two trusts that because the income could be utilised for promotion of or opposition to legislative or administrative educational measures and those being the primary objects the income was not liable to be applied solely to charitable purposes
In The Commissioners of Inland Revenue vs The Temperance Council of the Christian Churches of England and Wales 1 a Council constituted by resolution at a meeting of representatives of the temperance Organisation of the Christian Churches of England and Wales the purpose of which being united action to secure legislative and other temperance reform was held not to be a council established for charitable purposes only nor was its income applicable to charitable purposes only and that it was therefore not entitled to the exemption sought
In Bowman vs Secular Society Ltd2 Lord Parker observed A trust for the attainment of political objects has always been held invalid not because it is illegal but because the Court has no means of judging whether a proposed change in the law will or will not be for the public benefit This Court in a recent judgment Laxman Balwant Bhopatkar by Dr Dhananjaya Ramchandra Gadgil vs Charity Commissioner Bombay 3 considered whether for the purposes of the Bombay Public Trust Act 29 of 1950 a trust to educate public opinion and to make people conscious of political rights was a trust for a charitable purpose
The Court held Subba Rao J dissenting that the object for which the trust was founded was political and political purpose being not a charitable purpose did not come within the meaning of the expression for the advancement of any other object of general public utility in section 94 of the Bombay Public Trusts Act 1950
The definition of Charitable purpose in section 9 of the Bombay Public Trusts Act closely follows the language used in the definition given under the Income tax Act section 43
But in Laxman Balwant Bhopatkar s case1 as in the cases of the Courts in England which we 1 2  442
3  580 have referred to it was held that the primary or the principal object was political and therefore the trust was not charitable
In the present case the primary purpose of the assessee was not to urge or oppose legislative and other measures affecting trade commerce or manufactures
The primary purpose of the assessee is as we have already observed to promote and protect trade commerce and industries to aid stimulate and promote the development of trade commerce and industries and to watch over and protect the general commercial interests of India or any Part thereof
It is only for the purpose of securing these primary aims that it was one of the objects mentioned in the Memorandum of Association that the assessee may take steps to urge or oppose legislative or other measures affecting trade commerce or manufactures
Such an object must be regarded as purely ancillary or subsidiary and not the primary object
The appeals therefore fail and are dismissed with costs
One hearing fee
Appeals dismissed


Summary:
The assessee company Me Andhra Chamber of Commerce had as its main object the promotion protection and development of trade commerce and industry in India
It owned a building where it had its offices and those parts of it not in the company s own use were let out to tenants
In income tax proceedings the company claimed exemption in respect of the rental income under s43 i of the Indian Income tax Act 1922
The claim was negatived by the assessing and appellate authorities
The High Court however held that the company was a charitable institution and its income from property was exempt under section 43 i
The Revenue appealed to the Supreme Court by special leave
It was contended by the appellant that the property was not held by the company for a charitable purpose within the meaning of section 43 i that the objects of the company were vague that the benefit contemplated by the Memorandum of Association was not to the public generally but to the members of the company only and that the objects of the company were political it being open to it to appropriate the entire income for political purposes
HELD i The term charitable purpose as defined in the Act was inclusive and not exclusive
It included objects of general public utility
The object of the assessee company promotion of trade and commerce in the country was an object of general public utility as not only the trading class but the whole country would benefit by it
It is not necessary that the benefit must include all mankind
It is sufficient if the intention be to benefit a section of the public as distinguished from specified individuals
571 F H
Commissioners of Inland Revenue vs Yorkshire Agricultural Society and The institution of Civil Engineers vs Commissioners of Inland Revenue  relied on
Commissioner of Income tax Bombay Presidency Sind and Baluchistan vs The Grain Merchants  Association of Bombay  disapproved
ii There was nothing vague about the company of general public utility such as promotion protection aiding and stimulation of trade commerce need not to be valid specify the modus or the steps by which the objects may be achieved or secured
573 A B
Runchordas Vandrawandas vs Parvati Bai LR 26 IA 71 Commissioners of Inland Revenue vs National Anti Vivisection Society and Baddeley and others Trustees of the Newtown Trust vs Commissioners of Inland Revenue  distinguished
iii The argument that it was only for the benefit of the trading classes in Andhra Desa that the funds of the company could be utilised did not stand scrutiny
574 D E
566 iv It cannot be said that a purpose would cease to be charitable even if public welfare is intended to be secured thereby if it includes the taking of steps to urge or oppose legislation affecting commerce trade or manufacture
If the primary Purpose be advancement of objects of general public utility it would remain charitable even if an incidental entry into the political domain for achieving that purpose eg promotion of or opposition to legislation concerning that purpose is contemplated
The object mentioned in the Memorandum of Association was that the assessee may take steps to urge or oppose legislative or other measures affecting trade commerce or manufacture
Such an object must be regarded as purely ancillary or subsidiary and not the primary object
575 G H 580 B C
In re the Trustees of the Tribune and All India Spinnere Association vs Commissioners of Income tax Bombay  relied on
Pemsel vs Commissioner for special Purposes of Income Tax  and Bowman vs Secular Society Ltd  referred to
Rex vs The Special Commissioners of Income tax ex parte The Incorporated Association of preparatory schools  The Commissioners of Inland Revenue vs
The temporance council of the Christian Churches of England and Wales  and Laxman Balwant Bhopatkar by Dr Dhananjaya Ramachndra Charity commissioner Bombay