Application of assessee trust for grant of registration under section 12AA was rejected on ground that activities of trust were purely commercial and trust was primarily engaged in sale/purchase of medicine, pathological tests, x-ray etc., which were in nature of business. Tribunal  held that activities of assessee were undoubtedly a charitable activity, therefore, assessee was eligible for registration under section 12AA. On appeal the Court held that  prescribed authority while examining an application for grant of registration is only required to examine nature, activities and genuineness of institution and mere existence of profit/surplus did not disqualify institution. Order of Tribunal is affirmed.