Standards & Norms

Supreme Court Judgement
Volume 15 - Issue 8
January 2023

Charitable Activity and Business Under Section 2(15) And 11(4a) - Supreme Court Judgement On General Public Utility Institutions

“The Supreme Court of India has given a landmark judgement which will have far reaching impact on General Public Utility (GPU) institutions subject to exemption under section 11. This ruling will also have impact on other charitable & religious institutions as far as incidental business activities are concerned.

 The major conclusions from the judgement with regard to the definition of ‘charitable purpose’ under section 2(15) are summarized in this issue. Further, this issue dealt with various aspects such as can a “GPU” institution have profit making activity, the meaning of the word ‘incidental’ to determine permissible business activity, charging fee significantly above cost will be treated as business, will the judgement affect incidental business activities all institutions other than engaged in GPU, authorities, corporations or bodies established by statute, statutory regulators, trade promotion bodies, non-statutory bodies, sports associations, private trusts, and concluding remarks on business activities by a charitable or religious institution.

For more, please read the Ecommunique in the attachment.

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