Our Lady of the Philippines

March 17, 1986 Our Lady of the Philippines Trappist-Cistercian Monastery, Inc. c/o Fr. Gabriel Oppus Trappist Monastery Jordan, Guimaras, Iloilo Gentlemen: This refers to your letter dated March 4, 1986 requesting for a ruling on the query posed therein. It appears that Our Lady of Philippine Trappist-Cistercian Monastery, Inc. is a religious corporation duly registered with the Commission. Lately, the monks, in an effort to survive, tried selling some of its agricultural products in order to sustain the corporation. You, therefore, request for a ruling of this Commission whether the corporation is required to submit pertinent documents and/or subject to penalties or charges as a result of such act. prcd In connection therewith, Section 87 of the Corporation Code provides: "SECTION 87. Definition . For the purposes of this Code, a non stock corporation is one where no part of its income is distributable as dividends to its members, trustees or officers, subject to the provisions of this Code on dissolution: Provided, that any profit which a non-stock corporation may obtain as an incident to its operation shall, whenever necessary or proper, be used for the furtherance of the purpose or purposes for which the corporation was organized, subject to the provisions of this Title." (emphasis supplied) xxx xxx xxx It can be deduced from the underlined phrases of the aforecited provision that a non-stock corporation has the power, among others, to engage in such activities where it can derive income or profit reasonably necessary to carry out the purpose for which the corporation was organized. Although the activity posed is not expressly stated in your articles of incorporation, a perusal of your " Modus Operandi " which was submitted at the time of incorporation reveals that planting of agricultural crops is one of the methods by which you intend to support the corporation . Accordingly, the sale of your products may be considered as incidental thereto. You may therefore sell your agricultural products to defray the operational expenses of the corporation. In no case, however, shall income or profits derived therefrom be distributed to the members or officers of the corporation. Thus, in answer to your query, the corporation need not submit any document in pursuit of such activity. Neither is it subject to any penalty or charges in connection therewith. Please be advised accordingly. Very truly yours, (SGD.) JULIO A. SULIT, JR. Associate Commissioner