CRESCENT EDUCATIONAL TRUST vs REGISTRAR OF TRADE UNIONS LAHORE art — 2022 PTD 1384 LAHORE-HIGH-COURT-LAHORE |

Fields are extracted from the reported citation and judgment text. Where a detail is not stated in the record, it is not shown.

CRESCENT EDUCATIONAL TRUST VS REGISTRAR OF TRADE UNIONS LAHORE art.199---Punjab Industrial Relations act (XIX of 2010), Ss.24 & 1(3)(h)---Constitutional petition---Maintainability---Collective Bargaining agent, certification of---Locus standi---Scope---Petitioner / Establishment was aggrieved of registration of respondent as a Collective Bargaining agent by the Registrar of Trade Unions---Contention of respondent was that an employer did not have standing to challenge the registration of trade union---Validity---Challenge here was not entirely to the registration of trade union but to a determination made by the Registrar---Petitioner was a trust and was directly aggrieved of the determination of the Registrar, in that, it concluded that it was being run and managed on commercial basis which had impacted the status of the petitioner as a charitable institution and its entitlement to benefits under various laws. S.100C---Tax credit for charitable organizations---Scope---One of the persons to whom the provision of S.100C, applies is a trust---Subsection (2) of S. 100C, Income Tax Ordinance, 2001, provides the category of income which is eligible for tax credit and includes income from donations, voluntary contributions and subscriptions as also income from investment in the securities of the Federal Government---Said provision pre-supposes that the income of a trust can be invested in the securities of the Federal Government and which income too is subject to tax credit---Under subsection (2)(f) of S. 100C, the eligibility of tax credit is subject to the condition that none of the assets of trust or welfare institutions confers a private benefit to the donors or family, children or author of the trust or any other person---Further a cumulative reading of subsections (1A) & (1B) of S. 100C would show that surplus funds of trust would only be taxed in case funds are not spent on charitable or welfare activities during the tax period---By subsection 2(d) of S.100C, income eligible for tax credit include income of an educational institution being run by a non-profit organization existing solely for educational purposes. S.1(3)(h)---Educational institution---Scope---Institutions providing education are exempt from applicability of Punjab Industrial Relations Act, 2010, under S. 1(3)(h) but this clause excludes institutions which are being run on commercial basis. S.1(3)(h)---Expression 'Commercial basis', definition of---Scope---In the context of Punjab Industrial Relations Act, 2010, the term commercial has to be seen as connoting trade or business occupation carried on for profit---Trust imports commerce, trade or enterprise having financial profit as primary aim---Intrinsic nature of the activity of an organization and its purpose and consequence would be the determining factor---Any educational institution is bound to make profit but the real question is that profit or surplus should not enrich a trustee or his family, it must be diverted back to charitable and welfare activities. S.100C---Punjab Industrial Relations Act (XIX of 2010), Ss.24 & 1(3)(h)---Collective Bargaining Agent---Educational institution---'Commercial basis', meaning of---Scope---Petitioner/Establishment was aggrieved of registration of private respondent as a Collective Bargaining Agent by the Registrar of Trade Unions---Petitioner was a charitable educational institution which was a registered trust---Major source of income of the petitioner was donations from trustees and surplus of income and funds over expenditures of the trust were solely used for the promotion of purposes and objects specified in the trust deed---No dividend/bonus from surplus funds of the trust could be given to any members of the trust or his relatives---Petitioner (Institution) was also granted an exemption certificate in terms of S.100C of the Income Tax Ordinance, 2001---Petitioner was issued a NPO (Non Profitable Organization) certificate by a NPO Certification Agency---Registrar was swayed by the fact that the trust was making profits as also that the infrastructure built in the school had not been developed out of the donations made by the trustees but was being made from the fee charged from the majority of the students---Only question was whether the funds were being expended on a commercial basis and in the absence of any evidence, it was unlawful to conclude that the petitioner trust was being run on commercial basis---Petition was allowed, impugned order as well as certificate of Collective Bargaining Agent were declared to have been issued without lawful authority and of no legal effect.

CRESCENT EDUCATIONAL TRUST vs REGISTRAR OF TRADE UNIONS LAHORE art — 2022 PTD 1384 LAHORE-HIGH-COURT-LAHORE

Case information

Judgment text as reported

Other judgments reported in 2022 PTD