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2013 (10) TMI 765 - AT - Income TaxDenial of exemption u/s 11 of the Income Tax Act for a Trust registered u/s 12A of the Act – Trust hit by the provision of section 13(1)(b) of the Income Tax Act – Held that:- As per the judgment of Hon’ble Jammu & Kashmir High court in the case of Ghulam Mohidin Trust v. CIT [2000 (11) TMI 99 - JAMMU AND KASHMIR High Court], wherein it has been held that trust was a religious trust created exclusively for the benefit of persons belonging to a particular religious community, which is the Muslim community. Even the ex gratia grants and loans on easy terms for further studies and research are confined to Muslims - Trust was covered within the ambit of clause (b) of section 13(1) which denies exemption of income to such trusts under section 11 of the Act - Clause (a) of section 13(1) of the Act was also attracted because whole of the income from property held under the trust, which is a private religious trust does not enure for the benefit of the public – In the above mentioned Ghulam Mohidin Trust case, assessee-trust was not entitled to claim exemption under section 11 of the Act for the income derived by it from the property held under the trust – But this case is not applicable in the present case of the Assessee in hand – Reliance has been placed upon the judgment in the case of CIT v. Sun Engineering Works P. Ltd. [1992 (9) TMI 1 - SUPREME Court], wherein it has been held that the court must carefully try to ascertain the true principle laid down by the decision and not pick out words or sentences from the said judgment divorced from the context of the question considered by the court in that case to support their reasoning – Judgment of the Hon’ble J&K High Court in the case of Ghulam Mohidin is not applicable to the case of the assessee as none of the object of the trust has limited the application of the entire income to a particular community. In the present case, total expenditure incurred by the assessee at ₹ 5,53,27,631 the major expenses of the assessee is on conducting a peace conference which were to the tune of ₹ 4,84,61,830. It was a 10 day peace conference and the focus was to create communal harmony and awareness and understanding of Islam and its message of peace for entire humanity to help, remove misconception, false fear, hate of Islam globally to help realise that justice, human rights, moral values and peace be it on any individual or at world wide collective level are a must for effective human progress and realistic global unity - The said peace conference cannot be held to be a mere religious activity for the benefit of a particular community. Even if one has to go by the observation of the Assessing Officer in the assessment order that the assessee is a mixed trust, even then clause 13(1)(b) cannot be applied as it is applicable to purely charitable trust as held by the hon'ble Gujarat High Court in the case of CIT v. Barkate Saifiyah Society [1993 (11) TMI 13 - GUJARAT High Court] – Benefit of exemption u/s 11 is allowed to the Assessee – Decided against the Revnue.
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