Of Income Income [[Tax v. Mehta Charitable Prajnalay Trust

IN THE HIGH COURT OF DELHI Reserved on: 6't' Septentber, [2012]Date of Decision: [2dt' Noventber, ][2012] % +rr|417/2003+tTAl8l2004+tTA72212007+lTA770l20l.L+rTA 1050/2011+ITA 1051/2011 COMMISSIONER OF INCOME INCOME [ ] OF INCOME INCOME [ ].....AppellantThrough:Mr. Abhishek Maratha, Sr. [Standing]Counsel with Ms. Anshul [Sharma,]Advocate.Mr. Kamal Sawhney, Sr. [Standing]Counsel.Through:Mr. Abhishek Maratha, Sr. [Standing]Counsel with Ms. Anshul [Sharma,]Advocate.Mr. Kamal Sawhney, Sr. [Standing]Counsel. Versus MEHTA CHARITABLE PRAJNALAY TRUST ......RespondentThrough: Mr. Ajay Vohra [with ][Ms. ][Kavita ][Jha]and Mr. Somnath Shukla, Advocates.Through: Mr. Ajay Vohra [with ][Ms. ][Kavita ][Jha]and Mr. Somnath Shukla, Advocates. CORAM:MR. JUSTICE S. RAVINDRA MR. JUSTICE R.V. EASWAR R.V. EASWAR. J.: For detailed order see ITA No.30912003.a-.-l ..(R.V. EASWAR)JUDGE(s. RAVINDRA BHAT)JUDGENOVEMBF,rR 20,2012hs/vldIT A 4 | 7 /2003,1 8 1200 [4,7 ]22 [12007,7 ][7 0 ][l20l ][l, ] [05 ][0/20 I ] [and ] [05 ] [/20 I I]Page I ofl II ;L ,'a [,] ' ,I IN TIIE HIGTI COURT OII DELIII Ileserved on: 6tt' September, [2012]Date of Decision: 20tt' November, [201 ][2] o/o + xTA 309/2003 + tTA 41712003 + ITA 18/2004 + ITA 7242407 + ITA 77012011 + I'fA 1050/20L1.+ ITA 1051/2011+ ITA 1051/2011 COMMISSIONER OF INCOME .....Appellant Tlrough: Mr. Abhishek [Maratha, ][Sr. ][Standing] Counsel with Ms. Anshul [Sharma,]Advocate.Advocate. Mr. Kamal Sawhney, Sr. StandingCounsel. Versus MEHfA CHARITABLE PRAJNALAY TRUST ......Rospondent Through: Mr. Ajay [Vohra ][rvith ][Ms. ][Kavita ][Jha]and Mr. Somnath Shukla, [Advocates.] CORAM:MTT. JUSTICE S. RAVINDRA MR. JUS'TICE R.V. I'ASWAR R.V. I'ASWAIT. J.: '"rcr**ven appeals file<l by the Revenue under Section 260Aof theIrrcome'I'ax Act, 1961 [('Ac1', ]for short). [The relevant ][assessment ][years ][are1992' ]\93 to 1994-95, 2001-02 [and ][2005-06 ][to 2007-08. ][In ][all ][the ][appeals except ][the]appeal in I'I'A No.72212007,the [following ][substantial ][clueslions ][of lalv ][have ][been]frarned: - Welher tlrc Tribunal was correct in law [in ][confirming ][the]"(a) order of CIT [(A) ]and thereby holding that [the assessee ][is ][entitled ][to]exemplion under Seclion I I of the Income Tax Act? and 1051/201I Page 1 of 20 tTn 309/2003 ,417/2003,18/2004,72212007,17012011,1050/201I (/-lr j rx'' qr-'. "ii I I:i,, (b) lI/hether the Tribunal [was ][justified in ][law ][in ][relying ][on ][its]earlier order for A.Y. [lgg2-93 ][and ][thereby ][holding ][that ]lhebusiness activiiies [carried ][on by ][the ][assessee ][were ][incidental ][to ][the]main aims and obiects [of ][the ][Trust ][which ][are ][of ][charitable]nalure?" 2. In respect of ITA [No.72212007 ][only ][question ][No.(a) ][has ][been framed.] Welher tlrc Tribunal was correct in law [in ][confirming ][the]"(a) order of CIT [(A) ]and thereby holding that [the assessee ][is ][entitled ][to]exemplion under Seclion I I of the Income Tax Act? and 1051/201I Page 1 of 20 tTn 309/2003 ,417/2003,18/2004,72212007,17012011,1050/201I (/-lr j rx'' qr-'. "ii I I:i,, (b) lI/hether the Tribunal [was ][justified in ][law ][in ][relying ][on ][its]earlier order for A.Y. [lgg2-93 ][and ][thereby ][holding ][that ]lhebusiness activiiies [carried ][on by ][the ][assessee ][were ][incidental ][to ][the]main aims and obiects [of ][the ][Trust ][which ][are ][of ][charitable]nalure?" 2. In respect of ITA [No.72212007 ][only ][question ][No.(a) ][has ][been framed.] 3. The respondent - [assessee ][in ][all ][these ][appeals ][is ][the ][Mehta ][Charitable]Prajanalay Trust. [It ][was ][created ][by ][a ][trust ][deed ][drawn ][up on ][08.09'1971 by ][B' ][D']Mehta, partner of [the ][firm ][M/s. ][Bishan Das ][Girdharilal ][and ][Raj Kumar ][Mehta, ][S/o.]B. D. Mehta, [partner ][of ][IWs. Raj ][Kumar ][& ][Sons ][Co. ][These ][are the ][two ][founder ][-]trustees. They settled [an ][amount ][of ][72,2001- ][upon ][trust. ][Admittedly, this ][is ][the]only properly settled [on the ][trust. ][The ][trust ][deed set ][out the ][objects ][of ][the ][trust]which included [the ][establishing and maintaining ][of ][schools, ][colleges ][and ][study]circles, advancing [education ][and research ][study on ][the modem ][and ancient Indian]for [mental, ][moral ][and ][spiritual ][development, irnparting ][real]tliouglrt, providing education, laying [the ][foundations ][of high ][class ][character, ][inculcating the ][spirit ][of]nationalisrn and [patriotism, ][arranging ][for ][interpretation ][of ][ancient ][Hindu ][literature,]preparing and [publishing ][text ][books, ][providing ]['food, ][clothing, ][shelter ][and]medicines to needy [persons, ][running ][of ][medical ][dispensaries, ][hospitals, ][etc']clause 19 of the [trust ][deed ][provided ][that the ][lrust ][may ]["carry ][on ][any ][business ][for]ancl on behatf or [in ][the name ][of ][the ][n'ust ]for [the sole ][obiect of applying ][the ][income]and profrs thereof for [the ][purposes ][of ][obiects ][of the ][trltst". ][Another ][fact ][to ][be]noticed here is that [the ][founder ]- [lrustees ][were partner ][of ][firms which ][were]themselves engaged [in ][the business ][of ][the ][manufacture ][and sale ][of ][Katha'] 4. After the formalion [of ][the ][trust, ][a ][business ][was commenced ][in ][the ][narne ][of]tlre trust for the [manufactur ][e ][of ][Katha. ][The ][funds ][for ][this ][business admittedly]came from sister [concems ][of ][the firms ][in ][which ][the ][founder ]- [trustees were]partners and borrowings [from ][banks and ][other agencies. ] [production unit ][was ][set]up in the name ["'Mahesh ][Udyog" at ][Mahesh ][Nagar ][in ][District ][Una, ][Himachal]Pradesh in the [year ][1972. ][This ][unit ][started ][production on ][08.02.1973. ][Sometime] ITA 309/2003 ,41112003,1812004,722t2007,77012011,1050/2011 [and ][1051/2011 ][Page ][2of ][20] v in the year 1978, this unit was leased to lzVs. Shankar Trading Co. (P) Ltd., a sisterconcem in which close relations of the trustees held substantial interest. The unitcontinued to be run by the aforesaid company. The trust lvas in receipt of monlhlylease rental since then; the rental was revised sometime in the [years ]1989 [and]1991. The trust makes purchases and sale of Katha and cutch in its head officemainly through 1he two concems in which the founder trustees had substantia-interest. ITA 309/2003 ,41112003,1812004,722t2007,77012011,1050/2011 [and ][1051/2011 ][Page ][2of ][20] v in the year 1978, this unit was leased to lzVs. Shankar Trading Co. (P) Ltd., a sisterconcem in which close relations of the trustees held substantial interest. The unitcontinued to be run by the aforesaid company. The trust lvas in receipt of monlhlylease rental since then; the rental was revised sometime in the [years ]1989 [and]1991. The trust makes purchases and sale of Katha and cutch in its head officemainly through 1he two concems in which the founder trustees had substantia-interest. 5. We are not alvare r,vhat happened prior to the assessment [year ][1989-90.]However, for the said assessment year, the assessee seems to have claimedexemption under Section 11 in respect of its income and filed aretum of incomeon that basis. The exernption was denied and on [appeal ][to ][the ] [(Appeals), ][it]was lreld thal the business in Katha was carried on by the trustees or [the ][Board ][of]Directors and not by the beneficiaries of the trust and therefore in vierv of [clause](b) of Section l1(4A) as it existed at that time, it rvas held that the trust was notentitled to the benefit of exemption. Thus the [assessment ][was ][upheld by the CIT](Appeals). It is not known lvhether there was any further appeal to the Tribunal.In respeot of the assess-eni year 1990-91, a similar view was taken by thetassessing officer in the assessmeut [proceedings. ]On [appeal ][the ]CIT [(Appeals)]noted that the assessee \.vas registered as a charitable trust and its activilies [did not]involve any commercial activity for the purpose of making profits; it r,vas held thatthe case fell under Section 11(44,) [(b) ]of the Act [and ][to ][this ][extentthe ][benefit ][of]the exemption was not available. To this [extent ][his view ][lvas ][the same ][as ][the ][vielv]of his predecessor for the assessment year 1989-90. However, he [proceeded ]toexamine the case in the lighl of the [judgment ]of the Madras High Court in the caseof I'hanthi Tt'ust v. CBDT, [(1995) 213 ] [639 ][and ][held ][that ][the ][business was ][held]under trust and therefore'the provisions of Section i1(a) applied [to ][the ][exclusion ][of]Sectionll(4A)oftheAct. Inshort,heheldthatitwasacaseofproperty(i.e.thebusiness undertaking) being held under trust in accordance r.vilh Section 11(4) of^the [Act. ][He ][accordingly ][directed the ][assessing ][officer ][to ][allow ][the exemption.] ITA 309/2003,41712003,1812004,72212007,77012011,1050/2011 and 1051/2011 Page [3 ]of 20 ITA 309/2003,41712003,1812004,72212007,77012011,1050/2011 and 1051/2011 Page [3 ]of 20 6. In respect of the assessment [year 1992-93, rvhich ][is ][the ][first ][assessment]year with which lve are concemed in the [present ][batch ][of ][appeals, ][the ][assessee]filed its income tax return on the [sarne ][basis ][claiming ][exemption under Section ][11]of the Act. In the [assessment ][made ][under Section 143(3) ][of ][the ][Act, ][the ][assessing]officer held, following [his ][predecessor's ][view, ][that the ][business ][was carried ][on ][not]by the assessee - trust, but by [the Board ][of ][Directors ][of ][the ][company ][who ][are]managing the business. [FIe, ]therefore, [held that the ][provisions ][of ][Section ][I1(4) ][of]the Act were not applicable [and ][the ][provisions ][of ][Section ][11(4A) ][of ][the ][Act ][were]applicable. FIe noted that in the [Delhi ][office the trading ][activities comprised ][of]purchases and sales made through sister [concerns ][in ][which the ][founder ][trustees]were substantially interested [and ][the ][claim ][of ][the ][assessee ][that ][the ][i,vork ][in]connection with the business [of ][the ][trust ][is mainly ][carried on by ][the trustees ][was]not supported by the facts. He [also ][observ'ed ][that ][the ][affairs ][of ][the trust ][lvere]closely controlled by the tr,vo founder - [trustees and ][the ][beneficiaries ][i.e. ][the]members of the public did not [have any ][say. ][He further held ][that ][the ][prolits ][and]gains of the business were not incidental to [the ][attainment ][of ][the objects ][of ][the]trust. In this view of the matter [the ][benefit ][of ][Section I ][1 ][of ][the ][Act ][was ][denied ][and]the assessment was completed [on ][a ][lotal ][income ][of ][{62,86,390/- ][consisting ][of ][the]profits of the Katha business. 7. In the appeal filed against the [assessment, ][the ][assessee ][contended ][that ][it]was a public charitable trust existing [for ][the ][benefit ][of ][the ][members ][of ][the public,]that it rvas registered with [the ]CIT [under Section ][l2A,that ][the ][business was carried]on by the beneficiaries of [the ][trust in ][furtherance ][of ][the objects, ][that ][the provisions]of Section ll(a) of the Act and [not ][Section ][11(44) ][were ][applicable, ][that ][the]business of the trust was not canied [on ][with ][the motive ][of ][eaming ][profit ][but only]r,vitfu a view to deriving, income for [running ][the ][charitable hospitals, ][dispensaries,]schools, etc. and that if the [primary ][purpose ][of ][the ][trust ][was charitable and ][if ][the]other activities [are ]not [driven by ][profit ][motive, ][exemption under Section 11 ][of ][the]Act could not be denied. These submissions [were ][sought ][to ][be supported ][by ][the]judgment of the Supreme Court in the case of Addl. CIT v. [Surat ]Art [Silk Clotlt] n}\ 309/2003 ,417/2003,1812004,722120Q7,77012011,1050/2011 [and ][1051/2011 ][Page ][4 ][of ][20] -l t n}\ 309/2003 ,417/2003,1812004,722120Q7,77012011,1050/2011 [and ][1051/2011 ][Page ][4 ][of ][20] -l t Marutfacttrerr, [(1980) ]121 ITI{ 1. It lvas further urged [that the ][amendment ][to ][sub-]section (aA) of Section 11 rv. e. f. assessment [year ][1992-93 made ][the ][provisions]more liberal and that having regard to the [judgment ]of the Madras [High ]Court [in]Thanthi fi'zsf (supra) the assessee should be [granted ]exemption under Section [11.]The CIT (Appeals) was not [persuaded ]by [the ][submissions ][of ][the ][assessee. ][After]examining the trust deed, he made a distinction between the objects [of ][the ][trust ][and]the powers of the trustees and held that though the objects as [per ]the trust [deed]r,r,ere uridoubtedly charitable, clauses 19 [and ]20 [r,vhich ][permitted ][the ][trust ][to ][cary]on any business and to borroi,v [monies ]from [banks, ][individuals, ][financial]institutions and business houses are not really [the ][objects, ][but ][were ][clauses]stipulaling the [por,vers ]of the truStees. Having [thus made ][a ][distinction ][between ][the]objecls and powers, the CIT [(Appeals) ][proceeded ][to ][examine ][Section ][1I(4A) ][vis-d-]vis Section 11(a) of the Act. He [held ][that ][the ][amended ][provisions ][of ][Section]l1(4A) lvould apply from the assessmenl [year ][1992-93 onwards, ][and ][the ][effect ][of]the amendment was that the benefit of exemption [under Section 11 ][of ][the ][Act ][was]lot available to the income arising from [profits ][and ][gains ][of ][business ][unless the]business is incidental to the attainment of [the ][objects ][of ][the trust ][and ][separate]books of accounts are maintained by the trust in reipect of [the ][business. He ][held]that there lvas no dispute that separate accounts were [maintained ][in ][regard ][to ][the]business. With regard to the main contenlion of [the ][assessee ][that ][the ][Seclion]i1(4A) of the Act did not have any application [to ][the ][assessee's ][case ][because the]business itself r,vas held under 1rust, the CIT [(Appeals) ]was [unable ][to ][agree ][with ][the]assessee. According to him the facts in Thanthi ?zsl [(supra) were ][different; ][there,]the founder of the trust was carrying on the [business ][of printing ][and ][publishing ][a]]'amil daily newspaper as its sole [proprietor ]and the business [itself ][was ][settled]upon trust. In the present case, according to the CIT [(Appeals), ][the trust ][was]formed rvith a cash of <2,2001- contributed by the tr,vo founder [trustees ][bul ][no]business undertaking as such was settled [upon ]trust. [On the ][basis ][of ][this]distinction, the CIT [(Appeals) ]took the view that [the ][judgment of ][the Madras ][High]Court did not apply. ITA 309/2003 ,417/2003,1812004,72212007,77012011,1050/2011 [and ]1051/2011 [Page ][5 ][of ][20] 8. The aforesaid [view ][of ][the ] [(Appeals) was sufficient ][to ][dispose ][of ][the]appealbeforehimbutforthesakeofcompletenessandindeferencetotheargumenlstakenbeforehim,heproceededtoconsiderthecaseontheassumptionftatthejudgmentoftheMadrasHighCourtappliedtotheassessee,Scase.Fleobservedthatevenifthejudgmentisheldapplicabletothepresentcase,thequestiontobeexaminedwouldbewhetherthebusinesscanbeconsideredtobepropertylreldunderthetrustorisonlyabusinesscarriedonbyoronbehalfofthetrustbyvirtueofthepowersconferreduponthetrusteesunderclauseslgand20ofthe trust [deed. ][The ][other ][question, according ][to ][the ][cIT ][(Appeals)' ][that ][would]ariseforconsiderationwaswlretherthebusinesssocarriedonisincidentaltotheatlainmentoftheobjectsofthetrustasstipulatedintheamendedSectionll(4A)of the [Act.] 8. The aforesaid [view ][of ][the ] [(Appeals) was sufficient ][to ][dispose ][of ][the]appealbeforehimbutforthesakeofcompletenessandindeferencetotheargumenlstakenbeforehim,heproceededtoconsiderthecaseontheassumptionftatthejudgmentoftheMadrasHighCourtappliedtotheassessee,Scase.Fleobservedthatevenifthejudgmentisheldapplicabletothepresentcase,thequestiontobeexaminedwouldbewhetherthebusinesscanbeconsideredtobepropertylreldunderthetrustorisonlyabusinesscarriedonbyoronbehalfofthetrustbyvirtueofthepowersconferreduponthetrusteesunderclauseslgand20ofthe trust [deed. ][The ][other ][question, according ][to ][the ][cIT ][(Appeals)' ][that ][would]ariseforconsiderationwaswlretherthebusinesssocarriedonisincidentaltotheatlainmentoftheobjectsofthetrustasstipulatedintheamendedSectionll(4A)of the [Act.] g.Sofarasthefirstquestionisconcemedi.e.lvhetherthebusinessitselfrvasheldundertrust,theClT(Appeals)heldthatwheretlretrusteesdecidetocarryonthebusinessinthenanreofthetrustbybonowingfundsordivertingmoneyfromsisterconcerns,itcannotbeacaseofpropertybeingheldundertrustbutwouldbeonlyacaseofbusinessbeingcarriedonforandonbehalfofthetrust.Hemadeadistinctionbetweenborrdwingsmadeforthepurposeoffacilitatingtherunningofbusinessheldundertrustandborrowingsmadeforthepurposeofcarryingonabusinessforandonbehalfofthetrust,rvheresuchborrowingsconstitutedtlrebasigsourceforthecommencementofthebusiness.AccordingtotheClT(Appeals),ifthisdistinctionisnotmaintained,therecanbenocasewherethebusinesswouldnotbepropertyheldundertrustorwherethebusinesscanbesaidtobecaniedonforandonbehalfofthetrustincontrasttothebusinessitselfbeingheldundertrust.Henotedthatafterthelrustwascrealed,thesisterconcemsinwhichthefounder - [trustees ][or their ][close relatives had substantial interest diverted ][funds in]favourofthebusinessandsomeborrowingswerealsomadefromtlrebarrksandthebusinesswasstarted.withinayealamanufacturingunitof'Kathaandcutchwassetupandbecamefunctional;thebusinessstartedearningprofitsandtheywereutilisedtopayoffthedebts,InlgT8theunitwasleasedtoM/s.Shankar I; lTA309/2003,417t2003'18t2004,122|2007,770|20||,|050/20lland105l/20llPage6of20 ++G -_-.T-tr!..-#-'i<€ffiffi@.q_ I t:1 ,Y I; lTA309/2003,417t2003'18t2004,122|2007,770|20||,|050/20lland105l/20llPage6of20 ++G -_-.T-tr!..-#-'i<€ffiffi@.q_ I t:1 ,Y Trading Co., a sister concern r,vhich had also contributed initially for the businessand in which the trustees and their close relatives had substantial interest. Thelease rent inilially fixed i.vas <25,0001- per monlh which was revised to {50,000/-per month from 01.04.1987 and to {1,00,000/- per month from 3l.IZ.l99l. Thetransactions of the business in its head office at Delhi were. mostly with sisterconcems. These facts, according to the CIT (Appeals), showed that the businessr,vas not settled upon trust and cannot be said 1o be a business held under trust. Thesource for the business came from borrowings and contributions by the sisterconcems and not from the trust, except to a meagre extent of T2,100/-. fheproperty held under trust may no doubt include subsequent accretions to the corpusof the trust fund but it cannot include acquisilions in relation to which the truststood in the capacity of a debtor to third parties, according to the CIT (Appeals).The business undertaking no doubt belonged to the assessee - trust and thebusiness was also carried on by it, but for these reasons the br.rsiness cannot be heldto constitute property held under trust. Having held that the business was not heldunder trust, the CIT (Appedls) proceeded to consider the further queslion r,vhetherthe carrying on of the Katha business lvas incidental to the attainment of theobjects of the trust. It r,vas submitted before him on the basis of clause i9 of thelrust deed that the lvhole purpose of the business was to provide funds or generateincome for being applied to the charitable activities lisled in the trust deed. Thesubmission was rejected by the CIT (Appeals) by holding that the fact lhat theincome generated by the business was applied to the charitable purposes of thetrust was not relevant and what r,vas relevant was whether the business activity r,vasitself incidental to the altainment of the objects of the trust, rvithin the meaning ofSection 1l(4A) of the AcL According to the CIT (Appeats) the rururing of aKathctfactory can hardly be said to be incidental to the attainment of the objects of theassessee - trust, which are the advancement of education, patriotism, Indianculturq etc. The fact that the whole or some part of the income of Katha businesswas to be applied in terms of the trust deed to the charitable objects would by itself and 1051/2011 PageT of 20 ITA 309/2003,41712003,18/2004,722/2007,77012011,1050/2011 I C. activity [incidental ][to ][the]cannot render [the ][carrying ][on ][the ][business ][as ][an]atlainment [of ][the objects of ][the ][trust'] 10. It would [appear ][that ][the ][assessee ][had ][taken ][up ][another objection before ][the]cIT [(Appeals) ][to ][the ][effect ][that the ][leasing ][out ][of ][the ][business ][unit ][to ][another]enlity did not [amount ][to ][carrying on ][of ][a ][business ][activity. ][The ][cIT ][(Appeals) ][did]not accept ihe [contention, ][holding ][that where a ][business ][or ][commercial ][asset ][such]as factory [manufacturing ][Katha ][and ][cutch is ][leased ][to ][another ][entity ][for ][a ][monthly]consideration [termed ][as lease ][rental, the rental income ][would ][constitute ][business]income in the hands [of ][the ][lessor. ][According to the ][cIT ][(Appeals), ][leasing ][out ][of].the factory is oniy one mode of exploiting a commercial [asset ][for ][gain ][and ][such]gain falls to be [considered ][as ][profits ][and gains ][of ][business'] 11. Certain [other contentions regarding the computation ][of ][the business ][income]were taken [before the ] [(Appeals) ][as ][an altemative ][arguments and ][these have]been dealt [r,vith ][by him, partly ][in ][favour ][of ][the ][assessee ][and ][partly ][against ][it' ][This]part ofthe case [need ][not ][detain us'] 11. Certain [other contentions regarding the computation ][of ][the business ][income]were taken [before the ] [(Appeals) ][as ][an altemative ][arguments and ][these have]been dealt [r,vith ][by him, partly ][in ][favour ][of ][the ][assessee ][and ][partly ][against ][it' ][This]part ofthe case [need ][not ][detain us'] 72. The [assessee ][preferred ][a ][furl'her ][appeal ][to ][the ][Tribunal ][in ] No.3633/Del/96. [The Tribunal, ][follor'ving ][its ][decision ][for ][the ][assessment year]1989-90 in ITA [No.3641/D ][ell94 ][by ][order ][dated 30.09.1996, ][heid ][that ][the ][Katha]business carried [on ][by the ][assessee ][was ][incidental ][to ][the altainment of the ][objects]of the trust, [which ][were ][for ][charitable ][purposes. ][As ][regards ][the position ][in ][law,]after the amendment [made ][to ][section 11(4A) ][of ][the ][Act ][w' ][e' ][f' ][01'04'1992'the]assessee [placed reliance ][on ][the judgment ][of ][the ][Supreme ][court ][in ][Assistant]Commissioner [of Income-tctx ][v. Thanthi Trust, (2001) 247 ][lTR785 ][(SC) ][in ][which]the effect of [the ][amendment was ][considered. ][It ][was ][held ][that ][the ][Supreme Court]has noted the [amendment and ][held that ][it ][did ][not ][have ][any ][adverse ][effect on ][the]claim of exemption [under section 11, ][provide<l ][the ][income ][from ][the ][business]carried on by [the ][trust ][is ][utilised ][by the trust ][for ][the ][purposes ][achieving ][the ][objects]of the trust; [that ][would ][be ][a ][case ][of ][the ][business ][activity ][being incidental ][to ][the]attainment [of ][the objects ][of ][the ][trust. ][The ][Tribunal ][held ][tltat this ][decision squarely] ITA 309/2003 ,417t2003,1812004,72212007,77012011,105012011and [1051/2011 ][Page8 ][0f ][20] I .l ' tt"'f,:,{ {, covered the controversy in the [present ][case. ][In ][this ][view of ][the matter ][it ][directed]the assessing officer to allow [the exemption under Section 11 ][and ][thus allowed ][the]appeal oI me assessee. 13. It may be noted that the [Tribunal did not ][specifically ][address ][itself to ][the]question, which arose out of the order of [the'CIT ][(Appeals), ][whether ][the ][business]itself can be said to be [propeay ]held under [trust ][within ][the ][meaning ][of ][Section]11( ) of the Act. There is no discussion in [the ][order ][of ][the ][Tribunal ][as ][to ][the]irnpact of the various clauses of the trust [deed ][lvhich were ][referred ][to ][by the ] (Appeals) while making a distinction between [the ][objects ][of ][the trust ][and ][the]powers of the trustees. 74. In respect of all the other [assessment ][years ][namely ][1993-94, ][1994-95,]Z00I-02 and 2005-06 Io [2007-08, ][the Tribunal ][has ][followed the ][earlier ][order]passed by it for the assessment [year ]1992-93 [in ]ITA [No.3633/DeUI996. ][There ][is]no independent reasoning in any of them [since ][the ][facts ][for ][all ][the years were the]same as llrey existed [in ][the previous year relevant ][to ][the ][assessment ][year 1992-93.]In some of the orders, for [instance the ][order ][of ][the ][Tribunal ][for ][the ][assessment ][year]2005-06, there is additional [reference ][to ][the ][judgment ][of ][the Supreme Court ][in ][the]case ofThanilti Trust [(supra). ] . 15. Section 11(1) of [the ][Ac1 grants exemption ][to ][the ][income ][derived from]property held under trust wholly for charitable [or religious ][purposes, ][to ][the ][extent]to which such income is applied to such [purposes ][in ][India. ][There is ][no ][exhaustive]definition of the r,vords ["property ]held [under ][trust" in ][the ][Act; ][however, ][sub-section](4) says that for the purposes of Section [11, ][the ][words "property held ][under ][trust"]"includes a business undertaking so held". Sub-section [(aA) ][as ][it ][stands amended]by the Finince [(No.2) ]Act, 1991 w. [e. ]f. 0I.04.1992 [is in ][the ][following ][lerms: -] . 15. Section 11(1) of [the ][Ac1 grants exemption ][to ][the ][income ][derived from]property held under trust wholly for charitable [or religious ][purposes, ][to ][the ][extent]to which such income is applied to such [purposes ][in ][India. ][There is ][no ][exhaustive]definition of the r,vords ["property ]held [under ][trust" in ][the ][Act; ][however, ][sub-section](4) says that for the purposes of Section [11, ][the ][words "property held ][under ][trust"]"includes a business undertaking so held". Sub-section [(aA) ][as ][it ][stands amended]by the Finince [(No.2) ]Act, 1991 w. [e. ]f. 0I.04.1992 [is in ][the ][following ][lerms: -] "(4A) Sub-section (l) or sub-section (2) or sub-section [(3) ]or sub-section (iA) shall not apply [in relation ][to ][any ][income ][of ][a ][tt'ust ][or]an institution, being profts and [gains ]of [business, unless ][the]business is incidental to the attainment of [the ][obiectives ][of ][the ][trust] ITA 309/2003 ,4t712003,1812004,722/2007,77012011,1050/201I or, as the [case maY ][be, ][institution']and separate [books ][ofaccount]instituttion in [resPect ][of ][such]are rnaintained [bY ][such ][trust ][or]business." 16.Thequestionwhethersub-section(4A)wouldapplyeventoacaser,vhereabusiness [rvas ][held ][under trust ][r,vas ][answered ][in the negative ][in ][several authoritative]pronouncements [starting ][from ][the ][judgrnent ][of ][the Lahore ][High ][court ][in ][Gadodia]swadeshi stores [v. ][commissioner ][of Income ][Tax, ][Punjab, (1944) ][12ITR 385' ][The]general provision [under Section ][4(3Xi) of the 1922 ][Act exempted income derived]lrorn [property held ][under trust ][from ][ta,ration. However, ][section ][a(3)(ia) ][provided]that any income [derived ][from ][a ][business ][carried ][on ][on behalf ][of ][a religious ][or]charitable [trust would ][be entitled ][to ][exemption ][only ][if ][the ][business ][lvas carried on]inthecourseofcarryingoutofaprimarypurposeofthetrustortlreworkincorurection [r,vith ][the ][business ][is mainly ][carried on ][by the ][beneficiaries ][of ][the trust']The contention [<if ][the revenue in ][that ][case ][was ][that ][since clause ][(ia) ][was ][a special]provision dealing [with ][the ][topic ][of ][exemption ][in ][respect ][of ][a business ][carried ][on]lor and on behalf [of ][a ][trust, ][any ][claim ][for ][exemption ][as ][regards ][the ][profits ][of ][such]business can [be ][made ][only ][under ][that ][provision, ]. [and when ][the ][conditions ][laid]down therein [are ][not ][satisfied, ][it ][is ][not ][open ][to ][the ][assessee ][to fall ][back ][upon ][the]general provision [conlained ][in ][Section ][4(3xi) ][and ][claim ][exemption thereunder ][on]the ground [that ][business ][is ][property. ][The Lahore ][High court ][held that the fact that]the business [carried ][on ][on behatf ][of ][the ][trust failed ][to ][satisfy the ][two ][conditions]laid down [in ][section ][a(3)(ia) ][was ][no ][reason ][why ][it ][should ][not be ][exempted ][from]taxation if it [fell within ][section ][4(3xi) ][and ][the ][main ][ground ][of ][the decision is that]the two categories [mentioned ][in ][the ][two ][clauses ][having ][been ][enacted ][as two]different clauses, [it ][must be ][taken ][that the ][one ][did ][not ][exclude ][the ][other' ][This]judgment of the Laliore [Fligh ][court ][was ][approvingly referred ][to ][by the ][supreme]court in J. K. [Ii.ust ][v. ][commissioner ][of ][Incometax, ][(1957) ][32 ] [535. ][The]judgrnent'of the Supreme courl; [in ][J.K. ][Trttst ][v. ][cIT ][(supra) was ][followed ][by ][the]Supreme Court [(a ][Bench ][of ][equal strenglh) ][in ][Comtnissioner ][of ][Income-tax ][v']Krishna [warriar ][(P.), ][(1964) 53 ] [176. By ][that ][time ][clause ][(ia) ][of ][section 4(3)] I'fA 309/2003 ,4t'1t2Q03,1812004,72212007,77012011,1050/2011 [ancl ][1051/2011 ][Page ][10 ][0f ][20] '--(f,j-* a7 ,/ I'fA 309/2003 ,4t'1t2Q03,1812004,72212007,77012011,1050/2011 [ancl ][1051/2011 ][Page ][10 ][0f ][20] '--(f,j-* a7 ,/ had been enacted as a [proviso ]to [clause ][(i) ][of ][Section ][4(3), by ][an amending ][Act ][of]1953. After refening to [the ][judgment ][of ][the ][Lahore ][High ][Court ][(supra) ][and]rejecting the argument of the [revenue ]that [a ][proviso ][in ][a statule be ][ahvays ][read ][as]limitation upon the effect of the main enactment [Subbarao, ][J. ][(as ][he then ][was)]observed as under. - " .. . . .. ..BLrt it is not an inflexible rule of construction [that ][a ][proviso]in a statute shrntld always be read [as ][a limitation ][upon ][the ]ffict [of]the main enactment. Generally [the ]natural [presumption is ][that ][but]for [the ][proviso the ][enacting ][part ][of ][the ][section ][would ][have]included the subiect-tnatter of [the ][proviso; but ][the ][clear ][language]of the substantive [provisi,on as ][well ][as ][the ][proviso ][may ][establish]that the proviso is not a [qualifying ][clause ][of ][the ][main provision,]but is in itself a substantive [provision. ]In [the ][words of Maxwell,]"the true principle is that the sound view of the enacting clause,the saving clause and [tlze ][proviso ][taken ][and ][constt'ued ][togetlrcr ][is]to prevail". so construedwe find [no ][dfficulty, ][as ][we ][will ][indicate]Iaier in our itdgment, in holding [that ][the ][said ][clause ][(b) ][of ][the]proviso deals with a case of business [which ][is ][not ][vested ][in ][trust]for [religious ][dr ][charitable purposes ][within ][the ][meaning ][of ][the]substantive clause [of ]section [4(3)(i)'"] 17. Thus, if a property is [held ][under ][trust, ][and ][such ][property is ][a ][business, ][the]case r,vould fall under Section 11(a) [and ][not ][under ][Section ][i1(4A) ][of ][the ][Act.]Section 11(4A) of the Act, would [apply ][only ][to ][a ][case ][where ][the ][business ][is not]held under trust. 18. I1 vier,v-of the above setlled [legal position, ][lve ][are unable ][to ][accept the]contention urged on behalf of the [revenue before ][us ][that the ][provisions ][of ][Section]11(4A) are sr,veeping and lvould [also take ][in ][a case ][of ][business ][held ][under trust.] 19. The next [question ]which [lve ][have ][to ][consider is ][r'vhether, ][on ][the ][facts ][of ][the]present case and having regard to the terms of the trust [deed and ][the conduct of the]truslees, it can be said that the Katln [business ][lvas ][itself held ][under ][trust. ][There ][is]a difference between [a ][property ][or ][business ][held under ][trust ][and ][a ][business ][carried]on bv or on behalf of the trust. [This ][distinction ][was ][recognised ][in ][Addl.] I.IA 309/2003 ,41712003,1812004,722t2007,77012011,105012011 [and ][1051/2011 ][Page ][11 ][of ][20] 19. The next [question ]which [lve ][have ][to ][consider is ][r'vhether, ][on ][the ][facts ][of ][the]present case and having regard to the terms of the trust [deed and ][the conduct of the]truslees, it can be said that the Katln [business ][lvas ][itself held ][under ][trust. ][There ][is]a difference between [a ][property ][or ][business ][held under ][trust ][and ][a ][business ][carried]on bv or on behalf of the trust. [This ][distinction ][was ][recognised ][in ][Addl.] I.IA 309/2003 ,41712003,1812004,722t2007,77012011,105012011 [and ][1051/2011 ][Page ][11 ][of ][20] Comtnissioner [of ][Income Tax, Guiarat ][v. ][Surat ][Art ][Silk, ][(1998) ][121 ][ITI{ ][1, ][a]decision of five [Judges ][of ][the ][Supreme ][Court. ][It ][r'vas ][observed ][that ][if ][a ][business"]undertaking [is ][held ][under ][trust ][for ][a ][charitable purpose, ][the ][income ][therefrom']would be entitled [to ][the exemption under Section ][11(1) ][of ][the ][Act' ][In ][the ][case]before us [the ][finding of ][the ][cIT ][(Appeals), ][in ][his ][order ][for ][the ][assessment year]that [the ][Katha ][business ][was ][not held ][under trust, ][but ][it ][** ][a business]I.ggz-g3,is commenced [by ][the ][trustees ][with ][the ][aid ][and ][assistance ][of ][boffolvings from ][the]sister concerns [in ][which ][the setllors ][and ][the ][trustees ][or ][their ][close ][relatives ][had]substantial [interest, ][as ][well ][as ][from ][banks' ][It ][is ][thus ][with ][the ][help of ][the borrowed]funds, or in [other lvords, the funds ][not ][belonging ][to ][the ][assessee ][trust, ][that ][the]Katha business [was ][comrnenced ][and ][profits ][started ][to ][be eamed. ][The ][cIT](Appeals) has also found [that ][the ][earnings ][from ][the business ][were utilised ][to ][pay]off the borrowings. [It ][was ][for ][these reasons ][that he ][held ][that through ][the ][business]undertaking [belonged ][to ][the ][trust ][and ][the ][business ][lvas ][carried on by ][or ][on ][behalf]of the trust, but [for ][those ][reasons ][the ][business ][cannot ][be ][said ][to ][constitute].,property held under trust". He made reference to clauses 19 and 20 of [the trust]deed in this behalf [ancl ][noted that clause 19 ][provided that ][the ][trust ][may ]["carry ][on]any business [for ][or ][on behalf ][of ][or in ][the ][name ][of ][the trust ][for ][the ][sole ][object ][o{]to [income ][and ][profits ][thereof ][for ][the purposes and objects ][of ][the ][trust"']supplying Clause 20 [provided ][that the ][trust may obtain ][financial ][help ][from ][banks, ][financial]instilutions, [business houses and ][other organisations, ][etc. ][FIe ][r'vas ][inclined ][to ][vier'v]these clauses [only ][as polvers enabling ][the ][trustees ][to ][commence ][and ][carry ][on]business to augment [the ][resources available ][to ][the ][trust. ][It ][was ][for ][these ][reasons]that the CII [(Appeals) ][held ][that ][the Katha ][business ][was ][not ][held ][under ][trusl']Unfortunately [the Tribunal, ][which ][appears ][to ][have disposed ][of ][the ][appeal ][in ][a]rather summary [lnanner did ][not ][examine ][this ][aspect and ][merely ][endorsed ][the ][claim]of the assessee. [This is ][a ][matter ][of ][considerable ][importance ][and ][lve ][lvould ][have]thought that it [was ][incumbent ][upon ][the ][Tribunal ][to ][have ][examined ][this]fundamental [aspect, ][for ][two ][reasons: ][firstly, ][under ][Section 11(4), ][it ][is ][only ][the]business which [is ][held ][under ][the ][trust that ][r,vould ][enjoy ][exemption ][in ][respect ][of ][its] ITA309/2003,417t2003,1812004,722t2007,77012011,1050/2011ancl105l/20llPageL20f20 ITA309/2003,417t2003,1812004,722t2007,77012011,1050/2011ancl105l/20llPageL20f20 income under Section 11(1); [secondly, ][there ][is ][a ][distinction ][between the objects ][of]a trust and the powers [given ]to [the ][trustees ][to ][effectuate the ][purposes ][of ][the trust.]The CIT (Appeals) also held for [the ][assessment ][year ][1992-93 ][that ][while ][the ][objects]of the trust were certainly [charitable, ][clauses ][19 ][and ][20 ][arc ][mere powers ][conferred]upon the trustees to carry [on ][business, ][the ][prolits ][from ][which would ][feed ][the]clraritable objects. There is no settlement [of ][the ][business ][in ][Katha ][upon ][trust ][for]1he simple reason that the business [itbelf was ][not ][in ][existence ][at the time ][of]formalion of the trust. The [property held ][under ][trust ][was ][merely ][a ][sum ][of ][(2,100/-,]contributed more or [less ]equally [by the ][settlors ][at ][the ][time ][of ][creation ][of trusl ][on]08.09.1971. The business [rn ][Katha ][came ][into ][existence ][in ][the ][yew ][1972 ][and the]production unit in Mahesh Udyog, [Himachal ][Pradesh ][started production ][on]OB.OZ.lg73. Thus the Katha [business ][was ][not ][even ][in ][the ][contemplation ][of ][the]setllors and, therefore, [could ][not have ][been ][settled ][upon trust.] ZO. A felv decisions [may ][be ][noticed ][lvhich ][are ][of ][relevance ][to ][1he ][point. ][In ][the]case of .,/. K. ['I'rttst ][v. ] [(supra) ][one ][of ][the ][quesljons ][lvhich ][arose was ][whether the]office of managing [agency ][which ][\,vas ][an ][offtce ][of ][profit ][was ][in ][fact ][setlled upon]trust and, therefore, [could be ][considered ][to ][be ][business ][held ][under ][trust. ][The]Supreme Court held [that ][for ][the ][purposes ][of ][Section ][4(3Xi) ][of the 1922 ][Act, the]office of managing [agency ][lvas property ][which could ][be ][held ][under ][trust. ][The]I{evenue thereupon [poinled out that on the terms ][of ][Exhibit ]['A', ][which ][was the]deed of trust executed [by the ][settlors ][on i5.06.i945, ][the properties ][lvhich ][the]trustees are to hold and [stand ][possessed ][of ][were ][only ][the sum ][of ][tl,00,0004 ][and]a:ry donations and contribution [received ][by the ][truslees and ][all ][accretions ][thereto]and investment in securities [made ][from ][time ][to ][time ][representing ][the ][accretions,]and contended that on [the ][terms ][of ][the ][trust ][deed, the ][managing ][agency ][which ][was]acquired on 10.09.1945 [for ][a ][period ][of20 ][years ][cannot be ][said ][to ][be ][propeAy held]under trust since no [part ][of ][the ][initial ][amount ][of ][{1,00,000/-, which ][was ][setlled]upon the trust, was [utilised ][in ][the ][acquisition ][of ][the ][managing ][agency ][so ][as ][to]impress it with the character [of ][accretion. ][While ][repelling ][this ][contention, ][the]Supreme Court [held ][as ][under, (T. ][L. ][Venkataraman ][Iyer ][speaking ][for ][the ][Court): ][-] ITA 309/2003 ,417t2003,18t2004,72212007,77012011,1050/2011 and 1051/2011 Page [13 ][of ][20] i ry ,,.......lJltt it is to be observed that clause (s) of the trust [deed]expressly [provides ]for [the ][acquisition ][of ][the business.of ][mctnaging]ogun"y o,i [Udrnt| ][i7 ][the trust ][and ][' ].'with [the ][help ][of ][the ][trust ][fund"]ancl that [preciiety ][is ][what has ][happened ][snd ][indeed, ][reading]rogetherExhibits.AandB,itisitnpossibletoresist.theconclttsionthatboththe-cloctmtentsformedpartofanintegral.scheme,andthat what the [settlors ][had ][in ][view ][in ][clause ][3 ][of Exhibit ] [is ][the]very matxaging [agency, ][which was ][acquired ][wtder. ][Exhibit ][B']There is [coniderlabli ][attthority ][in ][England ][that when ][trustees]carryonbusinesswiththeaidoftrustfund'thlpositioninlawisthe same as [if ][they ][actually ][empioyed ][it in ][the business' ][though' ][in]fact, [it ][be ][not ][actually ][invested ][lherein'"] Exhibit [.8, ][in ][the ][case ][of ][J. ][K.Irusf ][(supra) was ][the documenl ][dated 10'09'1945](memorandum of [agreement) executed ][by the company ][constituting ][the ][trustees ][of]theJ.K.Trust,Bombayxitsmanagingagentonthetermsandconditionssetouttherein. It [is ][important ][to ][notice ][that ][the ][trust ][deed, ][lvhich ][is ][Exhibit ]['A" ][provided]inter aliathat [the ][trustees ][may, ]["with ][the help ][of ][the ][trust ][fund", for ][and on ][behalf]of and for [the benefit ][of ][the ][trust, carry on ][such ][business ][including the taking ][up]and conducting [of ][managing agency ][or ][selling ][agency ][of ][any company ][and may]start such [business ][and ][utilise the ][profits ][for ][all ][or ][any ][of ][the ][objects ][of ][the trust']Large [powers ][were ][conferred on ][the trustees ][in ][the ][conduct ][of ][the ][business ][which]included the [power ][to ][raise and ][borrolv ][money required ][for ][the ][purpose ][of ][trust' ][It]rnay be seen [that under ][the ][trust ][deed ][in ][the ][case ][of J. ][K. fi'zsf ][(supra) ][the trustees]were authorised [to ][carry on ][business ]["with ][the help ][of ][the ][trust ][fund"' ][It ][has also]been noticed [by ][the ][Supreme ][court ][that ][the ][sum ][of ][{1,00,000/- ][was ][given ][as]securitybythetrusteesunderExhibit.B,forthedueperformanceoftheirobligations [as managing ][agents. ][It ][lvas ][in ][the ][backgound ][of ][these ][facts ][that ][the]Supreme Court [held thal ][the managing agency ][business, ][which ][was acquired ][with]the help of [the ][trust fund, ][coul<l ][be ][considered ][as ][business ][held ][under ][trust ][and ][thal]the fact lhat [the ][amount ][of ][t1,00,000f ][which ][was ][settled ][upon ][trust ][was not]utilised for [the acquisition of the ][business, ][but ][was ][given ][merely ][as ][security deposit]for the clue [performance ][of ][the duties ][of ][the managing ][agents, ][did not ][matter' ][The]court was, [in ][the ][light of ][these ][facts and circumstances, ][inclined to hold ][that both] I'IA 309/2003 ,4t712003,1812004,12212007,17012011,1050/2011 [ancl ][1051/201I ][Page14 ][0t2l)] 'nf'(,r'"{[.!] I'IA 309/2003 ,4t712003,1812004,12212007,17012011,1050/2011 [ancl ][1051/201I ][Page14 ][0t2l)] 'nf'(,r'"{[.!] the. documents, namely [Exhibits ]['A' ][anci ]['B', ][formed ][part ][of ][an integral ][scheme]and what the settlors [had ][in ][view in ][clause ][3 ][of ][Exhibit'A' ][was the ][very ][managing]agency lvhich was acquired [under ][Exhibit ]['B'. ][The test ][appears ][to ][us ][to ][be ][ilral ][the]business, if it is to be [considered ][as ][property ][held ][under ][trust, ][should have ][been]either acquired with [the ][help of ][the ][lund ][originally ][settled upon trust or the ][original]fund that was settled [upon ][trust ][must have a substantial and ][real ][connection ][wilh]the later acquisition or [carrying on ][of ][the business ][by the ][trustees. ][The facts ][of ][the]present case do not measure up [to ][the ][test. ][The ][fund originally ][sellled ][upon trust]was a meagre amount [of ][{2,100/- at ][the ][time ][of ][the ][creation ][of ][the trust ][on].0g.09.1971. [It ][is undisputed that ][the ][Katha unit ][in ][Himachal ][Pradesh ][was ][set ][up ][in]the year 1972 r,vith [the aid ][and ][assistance ][of ][the ][borowed ][amounts, the ][boffolvings]being both from the [concenm ][in ][lvhich the settlors/ ][trustees ][held ][substantial interesl]and frorn commercial [banks. ][There is thus ][no ][nexus ][or ][integration ][between the]amount originally settled [upon ][trust ][and ][the ][later ][setting ][up ][and conduct ][of ][the]Katha business. Moreover, [the ][dislinction ][betrveen ][the original trust ][lund ][and ][the]later commencement [of the ][business ][with ][the ][ltelp of ][the ][borolved ][funds should ][be]kept in mind in the [context ][of ][ascertaining ][whether.the particular ][Katha ][business]lvas even in the contemplation [of ][the settlors ][of ][the ][trust. It ][is ][difficult to ][view ][the]original setllement of [{2,i00/- ][upon ][trust ][and ][the ][setting ][up ][of ][the ][Katha ][business]as part of an integated [scheme ][even apart ][from ][flre ][fact ][that ][the ][business ][was ][not]acquired or canied [on ]with [the ][help ][of ][the ][original ][trust ][fund'] 2I. In Thiagesar Dharnn [Vanikam ][v. ][Commissioner ][of Incotne-tax, ][(1963) ][50]ITR 798 a Division [Bench ][of ][the Madras ][High ][Court ][hetd ][that ][a ][busiuess ][carried]on behalf of a trust ["rather ][indicates ][a ][business ][which ][is not held ][in ][trust, ][than ][a]bttsiness of tlze [trttst ]rtmby [the ][lrustees". ][Inthat ][case ][the ][business ][was carried ][on]by the trustees for and [on behalf ][of ][the trust ][and ][it ][i,vas ][found ][as ][a ][facl ][that ][that]business was itself [held ][under ][1rust. In ][Raia ][P. ][C. ][Lall ][Choudhary ][Vs']. [Commissioner ][of Income ][Tax, ][Bihar ][& ][Orissa (1957) 31 ][ITI{ ][226, ][the Patna ][High]court ruled that section [4(3xD ][of ][the Indian ][Income ][Ta,r ][Act, ][1922, ][r'vhich]conesponds to Section [1(1) ][of the ][1961 ][Act, ][confers an exemption ][from ][ta:< ][only] ITA 309/2003,417t2003,t8t2004,722/2007,770t2011,1050/2011 [and ][l05l/2011 ][Page ][15 ][of ][20] (I" N ,/'- I ITA 309/2003,417t2003,t8t2004,722/2007,770t2011,1050/2011 [and ][l05l/2011 ][Page ][15 ][of ][20] (I" N ,/'- I where the [property itself ][is ][held ][under ][a ][trust or ][other ][legal obligation; ][it ][does ][not]apply to [cases ][where ][a ][trust or ][legal ][obligation is not ][created ][on ][any ][property' but]onlytlreincomederivedfrotnanyparticularpropertyorSourceissetapartandchargedforacharitableorreligiouspurpose.InCommissioneroflncomeThx.v.P.K. Barooah, [Vice-President, ][Jorhat ][Races (1970) ][77 ] [967 ]' [Ihe Assam ][and]Nagaland [High court, ][referring ][to ][the ][judgment ][of ][the ][Pa