Charitable purpose: Sections 2(15) and 80G(5): Recognition u/s.80G(5): Objects of assessee-trust include conduct of periodical meetings on professional subjects and publishing and selling books/booklets on professional subjects: Activities are charitable in nature and cannot be construed to be in the nature of trade or commerce or business: Assessee is entitled to approval u/s.80G(5).

The objects of the assessee-trust included conduct of periodical meetings on professional subjects, publishing books, booklets, etc., on professional subjects i.e., bank audit, tax audit, etc., and selling the same. The assessee filed an application in Form 10G to the Director of IT (Exemption), Chennai for grant of renewal u/s.80G of the Income-tax Act, 1961. The application was rejected on the ground that the assessee was publishing and selling books of professional interest to be used as a reference material by the general public as well as the professionals in respect of bank audit, tax audit, etc., and its activities are commercial in nature and will fall within the amended provision of section 2(15) of the Act. The Tribunal allowed the assessee’s appeal.

On appeal by the Revenue, the Madras High Court upheld the decision of the Tribunal and held as under:

“Activities of the assessee-trust in publishing and selling books of professional interest which are meant to be used as reference material by the general public as well as the professionals in respect of bank audit, tax audit, etc., cannot be construed as commercial activities and, therefore, the assessee-trust was entitled to approval u/s.80G(5) of the Act.”