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61. Now, coming to an examination of Hamdard‟s objects, Clause 44 (a) of the Deed dated 28.08.1948 lists out objects of public charity to include „relief of the poor, education, medical relief and the advancement of any other object of general public utility not involving the carrying on of any activity of profit‟. At first look, it would appear that the object is to promote charity generally, as opposed to limiting to any specific class of charitable objects. However, clause 45 of the Deed specifies the heads of charity, which may be classified under „education‟ (sub-clauses 45(1) and 45(2)) and „medical relief‟ (sub-clause 45(3)). Clauses 46 and 47 permit Hamdard to engage in other activities which would qualify under the head of „relief for the poor‟. While Hamdard may pursue charitable activities for the advancement of objects of general public utility (owing to the generality of clause 44), clauses 45, 46 and 47 indicates that Hamdard‟s objects fall W.P.(C) 3599/12, 5715/13, 5716/13, 5718/13, 5729/13 & 5711/13 Page 34 within the first three categories of „charitable purpose‟ spelt out in Section 2(15), and not in the residual category. Here, this Court relies on the Supreme Court‟s ruling in Dharmadeepti (supra), where the Court construed a general provision concerning charitable object in the trust deed in light of a specific clause. The Court observed:

69. The starting point for discussion is this Court‟s decision in Hamdard Dawakhana (Wakf) (supra), where, upon an examination of Hamdard‟s objects and its activities, the dominant object of the trust was to held be charitable and not carrying out a business activity. The Revenue‟s contention that this Court in that case did not have the opportunity to examine the actual nature of the activity carried out by Hamdard is unfounded. The revenue had then contended that Hamdard‟s objects also included running commercial institutions, laboratories, schools, inns, publication of books etc. and therefore, it should be denied exemption under the Act. However, the Court rejected this contention, and held that the objective of the trust was to apply the income for charitable purposes, and therefore, exemption could not be denied. The relevant observations of this Court merit reproduction herein, as follows:

18. In our view, the entire point is now covered by the Supreme Court's judgment in Addl. CIT v. Surat Art Silk Cloth Manufacturers Association [1980] 121 ITR 1 (SC). The court pointed out in that case that when the object of a trust was the carrying on of an object of general public utility, it is that object of general public utility which must not involve the carrying on of an activity for profit. It was pointed out that it was immaterial how the money for achieving or implementing such purpose was found. Whether that money was obtained by the running of an activity for profit or not, did not make the charity not charitable. Thus, in the present case, no doubt, the trust earns the money from the Hamdard Dawakhana. If that money is used for charitable purpose and not for the carrying on of any business at a profit, then the object of the trust is charitable, notwithstanding the source of the income.

81. In light of the above, this Court holds that the decision in Abul Kalam Azad Islamic Awakening (supra), where it was held the application of income derived from investment in commercial property to be the determining factor, is squarely applicable. Here, too, Hamdard, in accordance with its Trust Deed, has been applying and accumulating its income from business activities for charitable purposes. Hamdard has rightly placed reliance on this Court‟s decision in DIT v. Eternal Science of Man‟s Society, (2007) 290 ITR 535, where the Court allowed acquisition of moveable and immoveable property if it achieved the objects of a charitable trust. Therefore, this Court holds that Hamdard did not fail to apply or accumulate its income/surplus towards its objects.