Law: Income Tax Act, 1922

Section: 4(3)(0)

Income-tax Act (XI of 1922)---S. 4(3)(0--Exemption--Charitable purpose--Assessee, a Road Transport Corporation, established under a Provincial Statute offering advantages to public, trade and industries through road transport and a public utility service--Corporation acting on business principles under Provincial Statute and its entire capital was provided by Government and Corporation paid interest thereon--Profit earned by Corporation used for providing further amenities to the passengers and employees of the Corporation, and remainder, if any, paid to Government for road development which itself was an object of general public utility--Held, amount passed over to the Government was also used for an object of general public utility and Corporation was established for charitable purposes--Corporation having been established to run on business principles and profit arose from its activities, would not lose its character as a charitable institution--Income of Corporation, therefore, was exempt from income-tax under 4(3)(i). Andra Pradesh State Road Transport Corporation v. I.T.O. [1964] 52 I T R 524; Additional C.I.T. v. Surat Art Silk Cloth Manufacturers Association [1980] 121 ITR 1 at p. 25 C.I.T. v. Bar council of Maharashtra [1981] 130 ITR 28; Trustees of the Trubune [1939] ITR 415; Surat Art Silk Cloth Manufacturers Associations case [1980] 1 121 ITR (SC); Bar Council of Mahrashtras case [1981] l t0 ITR 28 (SC) and Andhra Pradesh Road Transport Coporation v. I.T.O. [1964] 52 ITR 254 (SC) ref. JUDGMENT D.P. MADON, J.--The above three appeals have been filed by certificate granted by the Andhra Pradesh High Court under section 261 of the Income-tax .Act, 1961, against the judgment of that High Court in an income-tax reference. The respondent, the Andhra Pradesh State Road Transport Corporation, is a Road Transport Corporation established with effect from January 11, 1958, by the State of Andhra Pradesh by a notification issued under section 3 of the Road Transport Corporations Act, 1950, (Act No. 64 of 1950) (hereinafter referred to in short as "the RTC Act"). Prior to the establishment of the respondent-Corporation, road transport in the State of Andhra…

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