9911796707
TMI Blog1970 (10) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... hich the previous year ended on June 30, 1959. The assessee, M/s. Textile Manufacturers' Association, Amritsar, is a company limited by guarantee and registered under the Indian Companies Act, 1913. It was incorporated in 1936. The assessee owns a building at Amritsar from which it derives rental income. That income was being assessed to tax in the previous years which was not objected to by the assessee but during the course of the proceedings for the assessment year 1960-61, the assessee contended that the rental income of Rs. 6,600 was exempt under section 4(3)(i) of the Income-tax Act, 1922 (hereinafter called " the Act "). The Income-tax Officer rejected the contention of the assessee and included the rental income in its total income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and interests merely of persons engaged in trade, commerce and industry. " In that case also, the question for determination was whether the rental income from building which the Chamber of Commerce had purchased was exempt from income-tax under section 4(3)(i) of the Act. At page 728, their Lordships observed as under : " In the promotion of trade, commerce and industries of India the public is vitally interested and it by the activities of the assessee that object is achieved, it would be within the meaning of section 4(3)(i) of the Act an advancement of an object of general public utility. In enacting the last paragraph of section 4(3) the legislature has used language of great amplitude. 'Charitable purpose' includes not only relief ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rested 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 sufficiently 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. " The judgment of their Lordships fully covers the case of the assessee in view of the following clauses stated in its memorandum of association : " 4. The income and property of the association whensoever derived shall be applied solely towards the promotion of the objects of the association as set forth in this memo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e who were members of the association. According to the observations made by their Lordships, the general public utility does not mean the mankind at large but also includes a section of the community sought to be benefited if it is sufficiently defined and identifiable by some common quality of a public or impersonal nature. In the present case, the section of the community is sufficiently defined and identifiable as the textile manufacturers of the Province of Punjab, which in 1936, extended from Delhi to Peshawar. The judgment of their Lordships fully applies to the facts of the present case. The learned counsel for the petitioner has, however, relied on the judgment in Rex v. Special Commissioners of Income-tax (Ex parte Headmasters' C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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