Judgment

D.P. Wadhwa, J.-State of Kerala in this appeal is challenging the judgment dated February 6, 1986 of the Division Bench of the Kerala High Court holding that MSP Family Jain Trust (‘Trust’ for short), of which the respondent is the President, is exempt from payment of tax on its agricultural income under Section 4 of the Kerala Agricultural Income Tax Act, 1950 (‘Act’ for short) as amended by Kerala Act 9 of 1974. High Court in its impugned judgment reversed the findings of the authorities under the Act that Trust was a private family trust and the dominant object of the Trust was to propagate a particular reli­gion and to render service to the followers of that religion and it could not be treated as a public trust. The authorities had also found that most of the income of the Trust was spent outside the State of Kerala.

2. For the assessment year 1974-75 (Accounting year 1973-74) the Trust filed its return of agricultural income under the Act showing net profit of Rs. 53,191.39 and claimed exemption for the entire income. The Assessing Officer by his order dated March 24, 1980 assessed the income of the Trust at Rs. 63,099.00. He declined the claim of exemp­tion made by th