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TMI Blog2011 (5) TMI 261X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 80G of the Income-tax Act even when the objects of the trust are charitable as provided to section 2(15) and that the activities of the trust are genuine and legal." 2. The brief facts relating to the issue are that the assessee trust moved application dated 9-4-2009 in Form No. 10G for renewal of approval under section 80G before the Commissioner of Income-tax-I, Agra. The said application was filed in the office of CIT on 11-9-2009. The learned CIT-I, Agra on perusal of the Trust deed, noticed that the objects inter alia mentioned in para 4(b) and 4(c) of the Trust deed, i.e., construction and maintenance of Brij Chaurasi Kos Parikrama way and construction and maintenance of Dharamshala, tents, night stay camps etc., in Brij Chaurasi Kos Parikrama Marg and to provide all facilities to the pilgrims coming to have Parikrama of Brij Chaurasi Kos, are religious in nature and for the benefit of Hindu Community. The ld. CIT, therefore, rejected the application on the following observations : (a) that the assessee trust has applied the fund for the purpose other than charitable as contemplated in Explanation 3 to section 80G(5) in contravention of section 80G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e benefit of any particular religious community or caste; (iv) the institution or fund maintains regular accounts of its receipts and expenditure; (v) the institution or fund is either constituted as a public charitable trust or is registered under the Societies Registration Act, 1860 (21 of 1860), or under any law corresponding to that Act in force in any part of India or under section 253 of the Companies Act, 1956 (1 of 1956), or is a University established by law, or is any other educational institution recognised by the Government or by a University established by law, or affiliated to any University established by law, or is an institution financed wholly or in part by the Government or a local authority; and (vi) in relation to donations made after the 31st day of March, 1992, the institution or fund is for the time being approved by the Commissioner in accordance with the rules made in this behalf : Provided that any approval shall have effect for such assessment year or years, not exceeding five assessment years, as may be specified in the approval." 4. From the perusal of the aforesaid section, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... application within 6 months from the date on which the application is made. We noted that in the case of the assessee-trust, the CIT was of the opinion that the assessee-trust has not complied with the conditions No. (ii) and (iii) of section 80G(5). He is of the opinion that the trust is expressed for the benefit of Hindu Religion and has applied the fund for the purpose other than charitable as contemplated in Explanation 3 to section 80G(5) in contravention of section 80G(5)(ii) of the Income-tax Act. The Explanation 3 to this section lays down that charitable purpose does not include any purpose the whole or substantially whole of which is of a religious nature. The main objection of the CIT is that the objects as enumerated in the trust deed provide for construction and maintenance of Brij Chaurasi Kos Parikrama Marg, construction and maintenance of Dharmashalas, tents, night stay camps etc., in Brij Chaurasi Kose Parikrama Marg and to provide all facilities to the tourists coming to have Parikrama of Brij Chaurasi Kos. According to the CIT these objects are of religious nature and for the benefit of Hindu Community. He has also noted that a trust or institution is permitted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case of Ragunath Das Parihar Dharmshala v. CIT [1986] 158 ITR 432/24 Taxman 379 has held that the sole object of the trust was to run a Dharmashala, which is an object of general public utility and so when this was the sole object, the income derived there from in the shape of rent from Dharmashala is exempt under section 11 read with sub-section (15) of section 2. Even in the case of CIT v. Paramhans Ashram Trust [1993] 203 ITR 711, the Rajasthan High Court, Jaipur Bench has held the objects of the assessee-trust consisting of maintenance of existing Dharmshalas, help of Agarwals and other widows and children, feeding of mendicants, construction of new Dharmashalas and schools and help of destitute to be charitable purpose. We do not agree with the CIT that the trust has incurred the expenditure for any purpose other than charitable purpose. This is a fact that the charitable purpose has been defined under section 2(15) of the Act, but there is no definition of 'religious purpose' given in the Income-tax Act. Hon'ble Supreme Court in the case of Addl. CIT v. Surat Art Silk Cloth Manufacturers Association [1980] 121 ITR 1/[979] 2 Taxman 501 has laid down the following general pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be non-charitable and are very much charitable purpose as defined under section 2(15) of the Income-tax Act. We do not find any force in the submission of the learned DR that the assessee-trust has violated the condition as stipulated under section 80G(5)(ii) of the Act. 8. Now coming to the question whether the assessee trust has violated the conditions as laid down in clause (iii) of section 80G(5), we reproduce this clause which reads as under: "(iii) the institution or fund is not expressed to be for the benefit of any particular religious community or caste." This clause stipulates that the Institution or the Trust must not be for the benefit of any particular religious community or caste. The words "religious community" means the group of people having a common religion or faith. The word "religion" means the belief in and worship to a superhuman controlling power, specially the personal God or Gods, a particular system of faith and worship. It means the trust should not be for the benefit of any particular group of persons having the common belief in worshiping of superhuman controlling power or having common system and faith and worship. If the trust is for the benefit o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed rituals and observances, ceremonies and modes of worship. Therefore, these objects cannot be regarded to be the religious objects. In our opinion, until and unless the activities for which the trust is established, involve the activity religious purpose, it cannot be said that the assessee has not complied with the condition No. (iii) enumerated under section 80G(5) of the Act. 10. Explanation 3 to section 80G(v) states that "in this section, "charitable purpose" does not include any purpose the whole or substantially the whole of which is of a religious nature." This Explanation takes note of the fact that an institution or fund shall be for a charitable purpose and may have a number of objects. If any one of these objects is wholly or substantially wholly of a religious nature, the Institution or Funds falls outside the scope of section 80G and the donation to it will not make the donor entitled for the deduction under section 80G. The objects as per Explanation 3 must be wholly or substantially whole of which must be of religious nature. The assessee has submitted all the evidence including the objects and how the expenditure has been incurred by it. The onus, in our opinion ..... X X X X Extracts X X X X X X X X Extracts X X X X
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