The Allahabad bench of the ITAT in  88 ITR (Trib) 44 (ITAT[All] held that to be entitled to exemption u/s11 the following two conditions have to be cumulatively satisfied:
A. the income should be derived from the property held in trust for charitable or religious purposes as ones defined in the trust deed;
B. the income should be applied for such purposes only.
In this case, the main object of the assessee-society was to establish and run hospitals and nursing homes however during the year it made donations to a charitable institution engaged in educational activities so that the bench held that such an application is ultra vires the objects clause of the assessee and did not fulfill the condition as stipulated under section 11(1)(a) to apply its income for such purposes in India. Therefore, the amount could not be considered the application of income, and the assessee-society is held not entitled for exemption under the provisions of section 11(1)(a) of the Act.
It is thus always better to draw the social objects in a manner as wide as possible to cover all types of charitable subjects mentioned in section 2(15) of the Act to meet any contingency