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9. The only question, therefore, that arises for our consideration and decision is as to whether the handing over of the accumulated income by the assessee-trust to another charitable trust having the identical objects and for fulfilment of the purposes for which the assessee accumulated such income amounted to application as required under the provisions of the Act. As we have already stated, the assessee's contention is that application to charitable purpose does not necessarily mean spending the amount on specified individual objects or purposes, whereas the departments's stand is that the amounts of income must be actually spent upon specified individual items falling within the connotation "charitable purposes". In this context, we may first of all consider the decision of the Madras High Court in Thanthi Trust's case (supra). In this case the assessee-trust as originally created was for the purpose of (1) establishing Dina Thanthi (daily newspaper) as an organ of educated public opinion for the Tamil reading public; (2) to disseminate news and to ventilate opinion upon all matters of public interest through the said newspaper; (3) to maintain the said newspaper and its press in an efficient condition, and devoting the surplus income of the newspaper and its press, after defraying all expenses, in improving and enlarging the said newspaper and its services and placing the same on a footing of permanency. Under power reserved in clause 3(j) of the original trust deed, the founder of the trust executed a supplementary deed directing the trustees to spend the surplus income for certain purposes specified therein presumably to bring them under the amended provisions of the Act defining the charitable objects under section 2(15) of the Act. One of the points that arose for consideration by the High Court in connection with the claim for exemption under section 11 was as to whether there had been an application of the income of the trust for charitable purposes. The objection of the revenue in this connection was that 75 per cent of the amount was only spent by making book entries in favour of a college without accounts of the college reflecting the corresponding entries. According to the revenue mere book entry would not amount to application of income to that extent for charitable purposes and, therefore, exemption was not allowable. The assessee's contention was that on account of accepting such entries as application of income in the past the revenue was estopped from taking a contrary view in the relevant assessment year. The relevant question that was referred to the High Court on this point was as under :

"Whether, on the facts and in the circumstances of the case, the mere crediting, of 75 per cent of the assessee's income to the accounts of Adityanar College of Arts and Science in the assessee's book will amount to application within the meaing of section 11 of the Income-tax Act, 1961 ?"

The question was referred at the instance of the assessee. The High Court while rejecting the contention based on the part conduct and practice of the department accepting such treatment in the accounts as application for purposes under section 11 and granting exemption accordingly on the ground that the principles laid down in H. A. Shah & Co. v. CIT [1956] 30 ITR 618 (Bom.) can apply only to a case where there is possibility of two different practices both of which are consistent with law and the tax authorities accepted one practice and later insist on a different practice which is likely to cause hardship and injustice to the assessee and such principle will not apply to a case where the practice adopted earlier is not consistent with law, had expressed the view that the principles laid down in the decision in Heles Slater Charitable Trust (supra) will apply to that case and held that since in the case of the assessee before them credit entries has been followed up by drawal of a portion of the amount by the concerned college in one year, and more than the amount credited in another year it clearly lead to the inference that the amount has been kept as a fund for educational purposes which can be operated at any time by the college. It was further observed that if the assessee had actually handed over the amounts on the dates when the credit entries were made to the college physically and it had deposited the same with a bank or with a third party for drawal of such amount as required by it in future, it cannot be said that there has been no application for educational purposes and that the fact that the educational institution chose to keep the money with the assessee trust itself cannot make any difference so long as it has been shown by the revenue that the assessee-trust retained any substantial interest over the money standing to the credit of the educational institution. It was also noticed that in the decision in Helen Slater Charitable Trust's case (supra), the Court construed the phrase "applied for charitable purposes" as including transfer of funds outright to another charitable institution which has exclusively charitable objects and the disposition of assets by one institution in favour of another institution in such manner as to pass the whole title in such assets to the transferee must ordinarily amount to an application of such assets within the normal use of the legal terminology. In other words, the Madras High Court has evidently quoted with approval the principles stated by the Court in Helen Slater Charitable Trust's case (supra) that transfer of funds outright by one charitable institution to another having exclusively charitable objects would amount to application to charitable purposes. On a plain application of these principles to the facts of the instant case, it cannot be disputed that by the assessee-trust handing over the amount or the fund represented by the accumulated income for several years to another charitable trust established undisputedly with the carrying out identical objects for which the assessee-trust was formed and accumulated the income the assessee must be held to have itself applied the same to charitable purposes. It is, however, necessary to meet two objections of the revenue in this regard. The first is that the assessee is not authorised and has no power to donate or make over its accumulated income to another trust and the second is based on the difference in the expressions used in clause (a) and clause (c) of section 11(3). Whereas clause (a) speaks of any income referred to in sub-section (2) being applied to purposes other than charitable, etc., clause (c) speaks of any such income being not utilised for the purposes for which it is set apart, etc. So far as the first objection is concerned even without reference to the specific provisions of the objects of the assessee-trust and as a general proposition in law it can be said that if handing over by a charitable trust of its income to be applied for charitable purposes to another charitable trust having similar or other objects of charity amounts to application to charitable purposes as seems to have been held in Helen Slater Charitable Trust's case (supra) and Thanthi Trust's case (supra) and the assessee-trust by its objects is entitled or authorised to apply to charitable purposes, which position the revenue evidently does not dispute, then clearly the act of the assessee-trust handing over the accumulated income to another charitable trust is intra vires by way of application of income unless any particular mode or manner in which the application has to be made is prescribed or directed by the provisions of the trust deed. But looking to the terms of the trust deed also we are satisfied that the assessee's impugned action is within its powers and charter and is authorised therein. The purposes for which the income of the assessee-trust has to be applied are stated in the trust deed as under :

5. The Board of Trustees hereby undertake to act diligently, promptly and expeditiously in carrying out the aforesaid objects and utilise the said funds only for the said objects and not utilise them for any other purposes whatsoever."

11. Now, undoubtedly clauses 1 to 4 of the assessee-trust authorised it to establish, maintain and manage educational institutions, hospitals, etc., and to take over any existing ones and maintain and manage the same and even aprat from clause 8 it stands to reason that the power to establish, maintain, manage or take over an educational institution, etc., imply all powers to carry out the said purposes in any manner expedient, suitable or convenient and to take all steps and actions necessary and incidental thereto. If, therefore, it is considered that it would be more expedient and affective way to achieve the objects in clauses 1 to 4 mentioned above to create a separate and independent foundation and to entrust the same with the task of executing and achieving the object of establishing or taking over any educational institution and maintaining and managing the same, the trust must be held to have the implied authority to do all such things inherent or embedded in the main objects. However, clause 8 specifically and expressly authorises he assessee-trust to do all such other lawful things as are incidental or conducive to the attainment of the above objects. We are, therefore, not impressed by this objection of the revenue that the trust is not specifically authorised to make over its accumulated income to another charitable trust to carry out the objects for which the assessee-trust has been formed.

12. Coming to the other objection based on section 11(3) and clauses (a) and (c), here also we do not find any merit in the department's objection. In the first place, the two clauses are designed to meet different situations. Clause (a) covers cases where income accumulated for charitable purposes in accordance with sub-section (2) is applied to non-charitable non-religious purposese or there is a change in the purpose for which it is accumulated or set apart, whereas clause (c) is aimed at non-utilisation or user of the accumulated income within the period contemplated under clause (a) of sub-section (2) of section 11 or in the year immediately following the expiry of the period for which accumulation is permitted. In other words, under clause (c) even where the income accumulated over the period mentioned in sub-section (2), clause (a) continues to be accumulated for application to charitable pupose after the period or after the year following the exipry of the period specified, the exemption shall cease to apply. Under clause (a) the exemption can be withdrawn and the accumulated income brought to charge even during the period for which accumulation is permitted where the income is applied to puposes other than charitable purposes or ceases to be accumulated therefor, whereas in clause (c) the exemption is withdrawn and the income brought to tax only after the expiry of the period. We have been furnished with the dictionary meaning of the words "utilised" and "used". The word "utilised" according to the Wagnal's New Standard Dictionary means "to turn to practical account; make (something) profitable or serviceable by applying (it) to some use improve" and the word "use" means "to employ for the accomplishment of a purpose; turn to account; make use of". etc. According to the Chambers' Twentieth Century Dictionary, 'utilise" means "to make use of, turn to use" and the meaning of "use" is "act of using" or "state or fact of being used", etc. We do not think the difference in the expression "utilised" in clause (c) and "used" in clause (a) make difference of any consequence and it appears to us that they are more or less used as synonymous terms. However, even assuming that the word "utilised" should be held to mean that the accumulated income should be held to be spent or used for a specified purpose, we consider that even then the assessee satisfies the requirement. As we have already stated, the assessee by taking the steps of forming the M. Ct. Muthiah Foundation for the specific purpose of acquiring or establishing certain educational institutions or hospitals, etc., and maintaining them and by handing over of the accumulated income to it for more effective way of implementing the object has, according to us, utilised the accumulated income for the purpose, stated in the notice given by it to the income-tax authorities under section 11(2). As an instance, we may refer to the notice of the assessee addressed to the ITO under section 11(2) dated 14-3-1963 relating to the assessment year 1962-63. According to this notice, it has been decided by resolution passed by the trustees on 1-3-1963 that out of the income of the trust for the previous year, relevant to the assessment year 1962-63 and subsequent nine previous years 100 per cent of the income of the trust should be accumulated or set apart till the previous year ending 1971-72 in order to enable the trustees to accumulate sufficient funds for carrying out the purposes specified therein. Undoubtedly, the formation of the Foundation Trust and the transfer of the accumulated income to it for the establishment and maintenance of hospitals and schools is towards fulfilment of some of the objects of charitable purposes and it amounts to the actual application of income to such purpose. It is to be noted that according to the recital in the Foundation Trust, the property known as "Rama Vilas" has actually been purchased by Thirupani Trust for the purpose of establishing and maintaining hospitals and schools. According to us, therefore, the assessee has utilised the accumulated income for the specified purpose for which it has given the notice to the ITO under section 11(2) and not application or utilisation of the income in any other manner not warranted by the purpose indicated in the notice was done. We also do not find anything in the objects stated in the various clauses explaining the provisions of the Act, introduced in this connection which would defeat the assessee's claim and support the stand of the department. What is stated in the object as disentitling the claim for exemption is that under the guise of application or accumulation of income the funds of the trust should not be invested in or used by any concern in which the author or founder of the trust or his relative has substantial interest and further that where a trust considers it necessary that sufficient funds should be accumulated to finance the establishment of any institution or other objects of charity it must be allowed to do so and to apply such income within a reasonable time. As regards the argument of the revenue based on the apprehension that if handing over of the accumulated income by one charitable trust to another charitable trust on the eve of the period of expiry of the accumulation permitted would amount to application to charitable purposes then it will defeat the very object of the enactment and the intention of the Legislature and render the provisions totally nugatory, we have not been referred to any particular circumstance in this case which would support such an apprehension. Even otherwise, there is no force in this argument because the authorities already referred to, namely, the principles in Helen Slater's Charitable Trust's case (supra) and the decision of Madras High Court in Thanthi Trust (supra) show that such handing over of the accumulated income by the one charitable trust to another charitable trust having identical or similar objects of charity itself amounts to application of income for charitable purposes and so long as this concept of application of charity stands the fact that it may give rise to certain loopholes which may be taken advantage of by persons in an attempt to avoid payment of legitimate tax can be no consideration in applying the law laid down and it is for the Legislature to plug the loophole, if necessary by appropriate legislation. We also do not find anything in the judgment of the Madras High Court in Thirupani Trust (supra) to support the revenue, as the facts therein are different and distinguishable because all that happened in the case is that the assessee had recovered an outstanding debt due to it from a debtor and as a process of realisation of such outstanding an asset, being a building, was acquired by the assessee. In such circumstances, the Court held that such a realisation of an outstanding and even acquisition of building or property does not amount to application of income for charitable purposes and it was only a case of conversion of one asset into another.