“commercial activity of trust”

Violation of the conditions under Section 13 of the Income Tax Act does not automatically lead to the conclusion that the activities of a trust are not in accordance with its objects. The revenue must demonstrate that the dominant activities are in the nature of trade, commerce, or business, not merely based on the volume of receipts.

An institution must be established solely for educational purposes and not for commercial activities to be eligible for exemption under Section 10(23C)(vi). Pursuing objects other than education, or having objects that enable commercial activities, disqualifies the institution from such exemption.

Charitable trusts claiming exemption under Section 11 and 12 of the Income Tax Act, 1961, are not hit by the proviso to Section 2(15) if their activities are primarily charitable and not commercial.

A transaction is not taxable if it is a normal business activity and lacks any element of tax evasion or artificiality, even if it reduces tax liability. The commercial expediency of a decision should be assessed from the businessman's perspective, not based on suspicion by the tax department.

Sales of finished products by a trust providing training in skills like catering and stitching are not necessarily commercial activities if they are incidental to the trust's primary charitable objects and not conducted as a business in the nature of trade, commerce, or business.

Activities of an organization are not inherently commercial or for profit merely because they generate receipts or involve subscriptions, especially if they are conducted to achieve the main objects of a charitable trust.