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2021 (12) TMI 93 - ITAT INDORERejecting the application for approval u/s 80G - assessee trust is registered u/s 12AA and is stated to be engaged in carrying out charitable activities including spiritual activities, samuhik prayers, yoga camp, old age home and also owns a temple namely “Balaji Mandir” - HELD THAT:- The assessee trust is providing food to poor, organizing medical camp and so it was not justified on the part of the Ld. CIT(E) to observe that the assessee trust is only running for religious activities. Even in the Income Tax expenditure account apart from the expenses for Pooja Samagri and Poshak trust has incurred other expenses. This facts goes un-rebutted by Ld. DR, therefore, so for as the first observation of the Ld. CIT(E) that the assessee is carrying out only religious activities does not seems to have merit as the evidence placed on record shows that the assessee trust is carrying out other activities also as enumerated in the trust deed. As regards the second observation of the ld. CIT(E) that the assessee trust has violated the provision of section 80G(5B) of the Act, we find that as per the provisions of section 80G(5B) for institutions or fund to qualify for getting approval u/s 80G(5B) of the Act the expenditure of religious nature incurred during any previous year should not exceed 5% of its total income. In the impugned order Ld. CIT(E) has alleged that the expenditure of religious nature incurred by the assessee has exceeded 5% of the total income. We, however on going through the submissions of the Ld. counsel for the assessee as well as facts placed on record, find that during the year total receipts appearing in the income and expenditure account are at ₹ 14,11,089/- and carpus fund received during the year (as shown in the balance sheet end 31st March 2017) is ₹ 7,43,111/-. Thus total receipt of the trust for the year at ₹ 21,54,200/- and against the total receipts the alleged expenditure of religious nature amounts to ₹ 88,262/- which in percentage term comes to only 4.10% of the total receipt. Therefore, in our considered view assessee has not violated the provision of section 80G(5B). CIT(E) erred in denying the approval u/s 80G applied by the assessee in Form 10G since the assessee is carrying out activities both religious and charitable in nature and expenditure of religious nature during the year have not exceeded 5% of the total receipts, assessee should be granted necessary approval u/s 80G. Thus, grounds raised by the assessee are allowed.
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