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21. To fall an institution in the 4th and last category of charitable purpose, fulfilment of two conditions is necessary, viz., (1) the purpose of the trust must be advancement of an object of general public utility and (2) that purpose must not involve the carrying on any activity for profit. There seems to be no serious dispute in this case about the fulfilment of first condition, i.e., the purpose of the trust is the advancement of an object of general public utility, viz, supplying the community with an organ of educated public opinion by publication of a Newspaper and securing the ends of social justice, liberty of thought, expression, belief, faith and worship. The equality of status and of opportunity, to promote among all fraternity assuring the dignity of the individual and the unity of the Nation. It is towards that end the assessee-society is publishing the Newspaper, Journals, Magazines, Periodicals, etc. The real question in this case which is to be decided is to scrutinise the existence of the second condition, i e. that the object should not involve the carrying on of any activity of profit. The carrying on of an activity for profit as such is not prohibited, if it was arising out of a business held under the trust or legal obligation for applying its income only to charitable purpose or was carried on for the purpose of earning profit to be utilised exclusively for feeding the charity. Sub-section (4) of section 11 provides that the property held under trust includes a business undertaking. Under this section if a claim is made that the income of such undertaking shall not be included in the total income of the persons in receipt thereof, the assessing officer has been given a power to determine the income of such undertaking in accordance with the provisions of this Act relating to assessment. If carrying on of any business is prohibited then there was no need for this section to exist Again, it is now well established by the decisions of the Supreme Court in the case of Surat Art Silk Cloth Mfrs. Association (supra) and CIT v. Bar Council of Maharashtra (1981) 130 ITR 28 that the test is what is the predominant object of the activity-whether it is to carry out a charitable purpose or to earn profit ? If the predominant object is to carry out a charitable purpose and not to earn profit, the purpose would not lose its charitable character merely because some profit arises from the activity. This is also held in the case of Andra Pradesh State Road Transport Corpn. (supra). In Surat Art Silk itself, the activity of obtaining licence for import foreign Yarn and quota for purchase of indigenous yarn carried on by the assessee was found and held not to be activity for profit within the meaning of section 2(15) of the Act. In CIT v. Madras Stock Exchange Ltd. (1981) 130 ITR 184 (SC), it was held that the receipt by a stock exchange as and by way of listing fee was not an activity of profit. In Victoria Technical Institute v. Addl. CIT (1991) 188 ITR 57 (SC), it was held that the function of buying and selling or selling on commission articles produced by handicraftsmen was for carrying out the primary purpose of the Institute and not an activity for profit. In Samaritan Society v. CIT (1997) 225 ITR 652 (SC), it was found as a fact that the real object of the assessee trust was charitable and that items 6 & 7 in the trust deed which enabled the trust to carry on business were meant merely to enable the trust to carry on its charitable objects in a more effective manner.

23. The meaning of the expression activity for profit has explained by the Supreme Court in Surat Art Silk Cloth Mfrs. Associations case (supra) as follows :

"The activity must, however, be for profit in order to attract the exclusionary clause and the question, therefore, is when can an activity be said to be one for profit? The answer to the question obviously depends on the correct connotation of the proposition for. This proposition has many shades of meaning but when used with the active participle of a verb it means for the purposes of and connotes the end with reference to which something is done. It is not, therefore, enough that as a matter of fact an activity results in profit but it must be, carried on with the object of earning profit. Profit making must be the end to which the activity must be directed or in other words, predominant object of the activity must be making of profit. Where an activity is not pervaded by profit motive but is carried on primarily for serving the charitable purpose, it would not be correct to describe it as an activity for profit. But where, on the other hand, an activity is carried on with the predominant object of earning profit, it would be an activity for profit, though it may be carried on in advancement of the charitable purpose of the trust or institution. Where an activity is carried on as a matter of advancement of the charitable purpose or for the purpose of carrying out the charitable purpose, it would not be incorrect to say as a matter of plain English grammar that the charitable purpose involves the carrying on of such activity, but the predominant object of such activity must be to subserve the charitable purpose and not to earn profit. The charitable purpose should not be submerged by the profit making motive; the latter should not masquerade under the guise of the former. The purpose of the trust, as pointed out by one of us (Pathak, J) in Dharmadeepti v. CIT (1978) 114 ITR 454 (SC) must be essentially charitable in nature and it must not be a covert for carrying on an activity which has profit making as its predominant object."

24. In the result, we hold that (t) the object of the trust is charitable and it falls in the fourth category of the definition given under section 2(15) of the Act; (ii) though it is non-profit making organisation and is registered as a charitable institution under section 12A of the Act, its activities have been on commercial lines and it had made profit year after year; (iii) its income has not been distributed but has been accumulated and utilised in running its activity in publishing and printing; (iv) as per clause 28 of Memorandum of Association, Rules & Regulation, the surplus asset after satisfying the liability and debts cannot be distributed and is to be given to another Society having similar objects; and (i) its activities are on commercial line and, therefore, the profit motive and the object public utility are so intermixed, interlaced, interwoven that they cannot be., separated. All these facts and circumstances show that it was a charitable institution but it loses exemption because it is hit by the ten restrictive words in the definition given under section 2(15) of the Act.