The Kerala High Court has dismissed the assessee’s writ petitions, holding that the exemption under section 10(23BBA) applies exclusively to bodies and authorities constituted, established, or appointed under a Central, State, or Provincial Act, and does not extend to public religious or charitable trusts or endowments—including temples, gurdwaras, wakfs, and churches—or to societies registered under the Societies Registration Act, 1860, or any other law, which are merely administered by such bodies or authorities.

The Court explained that section 10(23BBA) envisages exemption only for the income of the statutory body or authority created for administering a public religious trust or endowment. The institutions or establishments governed by such bodies are not themselves exempt from income tax under this provision. The proviso to the section reinforces this position by clarifying that the exemption does not apply to the income of any trust, endowment, or society placed under the administration of the statutory authority.

The High Court therefore held that public religious establishments governed by such bodies or authorities are not eligible for exemption under section 10(23BBA). Accepting the Revenue’s submissions, the Court observed that this restricted exemption framework exists because separate provisions—sections 11, 12, and 12A—already govern the tax exemptions available to religious and charitable institutions. While religious institutions such as trusts, endowments, and societies may qualify for exemption under sections 11 and 12, subject to statutory conditions, the statutory bodies created for their management may not be eligible under those sections.

Thus, when Parliament has specifically enacted a separate provision for granting exemption to the income of religious institutions, there was no necessity to provide an additional unconditional exemption through section 10(23BBA). The legislative intent behind section 10(23BBA) was to grant exemption only to the managing body or authority, which otherwise would not qualify for exemption under sections 11 and 12.

Accordingly, the writ petitions were dismissed in favour of the Revenue.