S. 2(15): Creating awareness about HIV/AIDS falls under medical relief category

Last Updated On: Feb. 9, 2020, 4:21 p.m.

On 23.01.2019, ITAT Delhi bench gave a significant pronouncement that activities of giving medical relief to patients & Creating awareness for eradicating HIV/AIDS are charitable activity under the ambit of ‘medical relief’ u/s 2(15) of the Income tax Act, 1961 (Act).

The above proposition was pronounced in the case of India HIV/AIDS Alliance v. Commissioner of Income Tax (Exemption), New Delhi, IT APPEAL NOS. 716 & 7210 OF 2017.


In this case, assessee is a company registered u/s 25 of the Companies Act, 2013 & u/s 12AA of the Act with the object of providing relief to the persons who are suffering from the HIV AIDS by providing financial, technical & managerial assistance & community support to those suffering from the disease. Also, it is working towards giving education to the public concerning the prevention of the above disease & to collaborate with other NGOs for the same. Assessee in its return for A.Y. 2010-11, claimed exemption u/s 11 & 12 of the Act. AO rejected the claim of the assessee of being a charitable institution by holding that it is covered under proviso to S. 2(15) of the Act as it is carrying on ‘object of general public utility’. 


• Whether activities carried on by the assessee trust are for charitable purposes as defined u/s. 2 (15) of the act and not business and profession? 

• If it is held that assessee is engaged in charitable activities then whether proviso to section 2(15) of the Act applies to the assessee or not.

• Whether the benefit of u/s. 11 and 12 of the Act is allowable to the assessee.


  • On looking at the object of the assessee as well as the activities of the assessee, it is apparent that assessee is carrying on the activities for the purpose of eradication of HIV AIDS disease. Therefore the purpose of the assessee is charitable falling into category of 'medical relief'. The proviso of section 2 (15) of the act only applies to the objects of general public utility and not to the medical relief.
  • Merely because the assessee receives the grant and also implement the project on behalf of the various organisation for eradication of HIV/AIDS, its activities does not become a business activity or non-charitable.
  • Further for the purpose of implementation of each of the project, assessee charges the management fees to defray all other expenditure and administrative cost of the assessee. Merely charging the management fees does not make the activity of the medical relief of the assessee as business activity.
  • In view of the above, tribunal opined that assessee is carrying on the charitable activities of medical relief falling u/s. 2 (15) of the act.
  • The factual matrix in the present case is that the foreign global fund the donor to the assessee gives 85% of the donation to the government of India for the HIV AIDS which runs the AIDS program in the name of National AIDS control Organisation and it is only about 15% of the total donations which are given to other societies for awareness and treatment to the poor HIV AIDS patients. It is also the fact he has recorded that the assessee spends the whole amount through various societies and trust and the assessee is also running its own project for the welfare of the HIV and AIDS patients. Further it is also the fact that assessee is a section 25 company under the companies act 1956 which cannot carry on any business activities. In view of the above facts it is apparent that assessee is existing for and is carrying on the charitable activities in the form of medical relief for HIV and AIDS patient and the awareness about the disease.
  • Finally, Assessee is carrying on the activities of medical relief for eradication and education of HIV AIDS patients the assessee is entitled to the registration u/s. 12 AA of the income tax act as there is no finding by the learned CIT - exemption that the activities of the assessee are not genuine.



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