TMI Blog1974 (11) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... The Indian Sugar Mills Association, hereinafter referred to as " the Association ", which has its office in Calcutta is a trade union registered under the Trade Unions Act, 1926 ; any individual, firm or company owning or managing a sugar mill or factory is eligible for membership of the association. Rule 3 of the rules of the association states the various objects for which the association is established and, of them, the first two, namely, rules 3(a) and 3(b), are as follows : " (a) To promote and protect the trade, commerce and industries of India, and in particular, the trade, commerce and industries connected with sugar. (b) To encourage friendly feeling and good relations amongst the sugar mills in general and the members in particular and also between producers of sugar and cane-growers, distributors of sugar and others dealing with sugar mills and connected with sugar industry. " It was claimed on behalf of the association that the business it carried on was in the nature of property held under trust or other legal obligation to apply the income for charitable purposes within the meaning of clause (i), sub-section (3) of section 4 of the Indian Income-tax Act, 192 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India Spinners' Association v. Commissioner of Income-tax, and by the Supreme Court in Commissioner of Income-tax v. Andhra Chamber of Commerce Of the several principles stated in the Tribune case, the one to which the High Court made special reference is that in countries to which English ideas may be inapplicable, the courts must in general apply the standard of customary law and common opinion amongst the community to which the parties interested belong in deciding whether an object is of general public utility. Referring to this principle the High Court observed that " section 4(3)(i) is of wider ampltude than what is known as religious or charitable purposes in English law and a purpose of general public utility has to be ascertained with reference to conceptions prevailing in our country ". We are afraid we do not see how this principle has relevance on the question under consideration in the present case because no conflict arises here between the English and the Indian conceptions of charitable purpose. In All India Spinners' Association's case, the Privy Council found that the primary object of the spinners' association was the relief of the poor which was a charitable pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de, commerce and industries and to stimulate the development of trade, commerce and industries in India or any part thereof and one of the objects mentioned in the memorandum of association that the chamber of commerce might take steps to urge or oppose legislative or other measures affecting trade, commerce or manufactures was purely ancillary or subsidiary aimed at securing the primary objects. In the case before us the High Court held that clauses (a) and (b) of rule 3 of the rules of the association, quoted above, set out the primary objects of the association which were objects of general public utility, and the other objects appearing from the remaining clauses of rule 3 were only ancillary. Relying further on a part of rule 4(a), which we have reproduced above, providing that no part of the income and property of the association was to be paid or transferred by way of dividend or bonus or otherwise by way of profit to the members of the association, the High Court came to the conclusion that the association was under a legal obligation to hold the income it derived from the business of export of sugar for charitable purposes. The exemption under section 4(3)(i) can be cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is also what distinguishes the present case from the Andhra Chamber of Commerce case, where it was found that the chamber of commerce had no profit motive, that its objects were to promote and protect trade, commerce and industries and to stimulate their development and its other objects were ancillary and incidental to the principal objects. Dr. Pal for the respondent also submitted that if rule 64 appeared to be inconsistent with the primary objects, it should be treated as void and of no consequence. Undoubtedly, rule 4(a) and rule 64 are repugnant to each other. But the rule of construction of deeds and wills on which Dr. Pal relied, that in case of repugnancy the first words in a deed and the last words in a will shall prevail, is not applicable to the rules and regulations of a registered trade union in order to find out its real object. We have no right to assume some of the stated objects of the association as primary to declare others in apparent conflict with them as of no effect. Rules 3, 4 and 64, all framed by the association as a trade union, co-exist. We have no right to re-write the rules of a registered trade union by deleting any of them. We also find it dif ..... X X X X Extracts X X X X X X X X Extracts X X X X
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