Royal Australasian College of Surgeons v Federal Commissioner of Taxation
68 CLR 436(Judgment by: Rich J)
Royal Australasian College of Surgeons
v Federal Commissioner of Taxation
Judges:
Latham CJ
Rich JStarke J
McTiernan J
Williams J
Subject References:
Taxation and revenue
Income tax
Assessment
Exemptions for scientific institutions
Legislative References:
Income Tax Assessment Act 1936 No 27 - s 23(e)
Judgment date: 5 November 1943
Melbourne
Judgment by:
Rich J
RICH J. The intention of the legislature as it appears in s. 23 (e) of the Income Tax Assessment Act 1936-1941 is to exempt the income, inter alia, of a scientific institution. The Act gives no definition of "scientific" and one must therefore look to the objects and practice of the particular institution. By "practice" I understand its activities. The principal activities of the College are set out in par. 7 of the admitted facts contained in the case stated. The object clause in the memorandum of association of the College consists partly of purposes and partly of powers. And, as I understand the cases, the test is whether it can be predicated that the College is in the main scientific. The inclusion of an institution in the exemption clause depends upon the intrinsic character of the object which it promotes and not upon the scope of the benefits which may result from its transactions. After considering all the relevant matter in the case stated (including the annexures) I have come to the conclusion that the main or real object of the College is the promotion and advancement of surgery. By this I mean that its essential purpose is to enlarge and extend the boundaries or area of the science of surgery. Its other objects are not collateral or independent but merely concomitant and incidental to the main object. And the fact that some of these subsidiary or ancillary functions and purposes may indirectly and incidentally be of benefit to the members of the profession does not destroy the exemption claimed.
For these reasons I consider that the College is a scientific institution and as such is entitled to the exemption provided in the Act.