TMI Blog2012 (12) TMI 283X X X X Extracts X X X X X X X X Extracts X X X X ..... inabove, the trust is not eligible for renewal of approval u/s 80G of the Act. The immovable property, as comprised in the 1st Schedule to the said Trust Deed remains untouched. The income from the said Trust property is to be applied first, in the maintenance and repair of temple property, as also to be spent for the worship of the said Deity and in the defraying of the usual expenses of holding festivals of the said deity, remains intact. Similarly, the construction of the temple and worship of the said Deity and adoration of the said Deity is still an integral part of unauthorisidely amended Trust Deed. Further, holding of periodical festivals of the Deity and offering daily worship, are still the organic part of the said Deed. These objects are purely religious in nature, inextricably linked to the Hindu religious community and its Deity 'Laxmi Narayan'. Even the unauthorized amended Trust Deed/so called supplementary Trust Deed contravenes the provisions of section 80G(5)(iii) read with Explanation 3 of the Act, being expressed to be for the benefit of a particular religious community i.e. Hindu. Trust is not entitled to renewal of approval u/s 80G(5) of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tails of other charitable activities done in addition to construction of temple along with original copy of corrigendum. 2.3 In compliance of the same, the authorized representative of the assessee appeared and produced cash book and other information required by the learned CIT-I, Amritsar and also submitted its reply dated 22-3-2009 mainly stated that on 1-8-2008 as per minute book and the corrigendum of the Trust Deed dated 1-8-2008, the objects of the trust was changed and one of the new object was construction of the Dharamshala and the trust has started construction of Dharamshala right thereafter on land measuring 10000 sq. ft . already with the trust and the donations received after 1-8-2008 have been spent on the construction of Dharamshala. The assessee further stated in its reply dated 24-3-2009 that since the trust is doing charitable work w.e.f. 1-8-2008 as per the provisions of law of the land and the judgment pronounced by the Hon'ble Supreme Court of India, the assessee requested that the renewal of registration u/s . 80G of the Act may kindly be granted. 2.4 After going through the reply filed by the assessee, the learned CIT-I, Amritsar is of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned order. He further stated that the learned CIT-I, Amritsar has not appreciated the order dated 19-12-2008 and wrongly rejected the application of the assessee , which is contrary to the decision of the jurisdictional Bench passed in the case of Maj. Gen . (Retd.) Kanwarjit Singh v. Asstt . CIT , [2006] 10 SOT 19 (ASR) (URO), which he has attached at page 12 of the paper book. He stated that in the aforesaid case, this Bench has held that the decision of the higher judicial authority must be followed and practice of treating the precedent as absolutely binding is necessary to secure certainty of law . But in the present case, the learned CIT-I, Amritsar has not followed the order dated 19-12-2008 passed by the I.T.A.T., Amritsar and passed the impugned order, as he has already passed on 27-8-2008 while rejecting the assessee's application for renewal of approval under section 80G ( 5) of the Act. He has also filed a copy of supplementary deed of Ramanujam Spiritual Public Charitable Trust and copy of affidavit of Shri Ravi Sharma S/o Shri Bishan Dass, Accountant of the Trust. He has also filed a paper book containing pages 1 to 27 in which he has attached ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earned CIT-I, Amritsar, specifically the finding given at page No. 5 of the impugned order. No other argument has been advanced by the learned D.R. 6. We have heard both the parties and perused the relevant material available with us. We have also thoroughly gone through the supplementary Deed of the Trust in which the assessee had rectified the Trust Deed dated 20-12-1993 and decided to change the objects of the Trust by passing a resolution on 1-8-2008 and also corrigendum written on 1-8-2008 w.e.f. 1-8-2008. An affidavit filed by Shri Ravi Sharma, Accountant of the Trust along with the order of the ITAT dated 19-12-2008 and various other documentary evidence filed by the assessee in the paper books. It is an admitted fact that the assessee has made a deed of public charitable trust on 20-12-1993, which is registered one. It is also admitted that the assessee has made one supplementary deed stating therein that the objects stated in the Trust Deed dated 20-12-1993 is not possible to continue in future and it has been decided to change the objects. Accordingly, a resolution was passed and recorded in the minute book on 1-8-2008 and also corrigendum was written on 1-8-2008 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. ( Bhawna Ramanjum) 2. Sd /- 2. Sd /- (MANORMA RANI) (CB. Acharya) W/o Sh. C.L. Sharma, H.No.6, Gali No.2, 3. Sd /- Vijay Nagar, Asr . (Janak Ram Sharma)" 7. After going through clause 4 of the original Trust Deed dated 20-12-1993 and the corrigendum dated 1-8-2008 as well as additionally added activities of the assessee trust along with documentary evidence filed by the assessee from page Nos. 14 to 18 of the paper book in which the assessee has shown the utilization of funds for the construction of Dharamshalas, we are of the considered opinion that the learned CIT-I, Amritsar has passed the impugned order without thoroughly considering the supporting evidence available with him. We have also gone through the order dated 19-12-2008 passed in I.T.A. No. 512 ( ASR ) /2008 in the case of the assessee -trust, wherein this Bench has held in paras 9 and 10, page 5 and the view taken in the impugned order has already been rejected by this Bench, relevant paras 9 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 227 ITR 578. The Hon'ble Supreme Court has held that establishment of public places of worship and prayer halls are religious purpose, hence donation to such institution and trust was not held to qualify for deduction u/s.80-G. Registration to any institution or fund whose purpose include whole or substantially the whole of which is religious nature, thus is not to be allowed for the purpose of section 80-G. In response to this query, Sh. Aggarwal has submitted before me that the trust was formed with the object of constructing a temple at Varindhavan for the worship and undertaking the spiritual education to the public in general. He also submitted a paper written on 20-12-1993 but signed on 1-8-2008 which he says is a corrigendum to the trust deed. Vide this corrigendum, clause-4 of the original trust deed has been deleted and the objects of the trust have been changed. I have considered Sh. Aggarwal's argument and the paper which is produced before me. The corrigendum is nothing but an afterthought and self serving document which has no legal binding. Hence it under no circumstances change the basic character and objects of the trust and it remains a trust for a temple with a de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... After going through the impugned order as well as order dated 27-8-2008 passed by the learned CIT-I, Amritsar, we are of the considered opinion that there is no change in both the orders. These are almost similarly worded orders, which show that the learned CIT-I, Amritsar has not taken into consideration thoroughly the order of the I.T.A.T. dated 19-12-2008. Thus the impugned order is not sustainable in the eye of law and is in violation of judicial discipline as held in the case of Maj. Gen . (Retd.) Kanwarjit Singh Gill ( supra ). We have also reproduced clause 4 of the original deed of the assessee-trust dated 20-12-1993 as well as the corrigendum written on 1-8-2008 w.e.f. 1-8-2008 wherein the trust has deleted clause 4 of the original Trust Deed right from the beginning as if it was never binding part of the Trust Deed along with the finding of this Bench in page 5, paras 9 and 10 of the order dated 19-12-2008 in which this Bench has held that there is nothing preventing the assessee from filing such corrigendum and thereby amending its objects. This Bench has also held that the findings of the CIT-I, Amritsar rejecting the corrigendum as a mere afterthought and not havin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s been carefully perused and considered by me. I also had discussions and deliberations, on the core issues, for adjudication, in the instant appeal. In spite of my best efforts, I am unable to convince the Ld. J.M., on the issue of amendment effected by the settlers, to the original Trust Deed, without there being any provisions for such amendment, in the original Trust Deed and without observance of the prescribed procedure, as laid down under section 26 of the Specific Relief Act, 1963 and section 92 of the Civil Procedure Code 1908 and also contrary to the several direct decisions of the Hon'ble Supreme Court and Jurisdictional High Court on the issue. Further, both the original and supplementary Trust Deeds contravene the express provisions of section 80G(5)(iii) r.w. Explanation 3 to section 80G(5C) of the Act and, hence, the impugned order of the CIT, cannot be set aside but to be upheld. Therefore, I propose to write a separate dissenting order, in the following manner. 2. The assessee filed the present appeal against the order of the Commissioner of Income Tax-1, Amritsar, dated 30th July, 2009, passed under section 80G(5) read with section 254 of the Income-tax Act, 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent appeal was filed before us. 4. In the course of present appellate proceedings, the Ld. Counsel for the assessee, filed two paper books containing pages to 1 to 27 and pages 1 to 17. The Ld. AR also filed written submission, in the paper book bearing paper book No.2, which is reproduced hereunder, for the purpose of proper appreciation of the same: "This is an appeal against order of the Ld. CIT again rejecting the renewal u/s 80G of the Act on remitting the matter back to CIT by the Hon'ble Court". The brief facts of the case are that up to 31.03.08 the trust was granted renewal u/s 80G. An application was again filed for renewal which was rejected earlier by the CIT. The reason was that the trust was doing religious activity and in view of Explanation 3 to section 80G of the Income-tax Act, the renewal was rejected. During the course of proceedings the trust filed a corrigendum in which the objects was changed w.e.f. 1.08.2008 which the CIT rejected being an afterthough. Against that order this Hon'ble Court accepted assessee's appeal and restored the matter back to the file of CIT with a specific direction that the order be passed after considering the corrigendum. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion. The Ld. Counsel for the assessee, further, argued and contended that the Trust is competent to amend clause (4) of the original Trust Deed and to add new objects to the said Trust Deed by way of passing resolution. 5. The Ld. 'DR', on the other hand, vehemently contended that the objects contained in the Original Trust cannot be amended, as there is no provisions, in the original Trust Deed, for such amendment, addition or deletion. He referred to page-3 of the impugned order of the CIT, to support his contention. The Ld. 'DR', placed reliance on the order passed by the CIT u/s 80G of the Act. 6. I have carefully perused and considered the rival submissions, relevant paper books filed by the assessee and the case laws cited therein, as also the impugned order passed by the CIT, including the original Trust Deed, corrigendum to original Trust Deed and the supplementary Trust Deed. 6.1 The assessee trust placed reliance on the following decisions: ( i ) Maj. Gen . (Retd.) Kanwaljit Singh Gill ( supra ). ( ii ) Union of India v. Kamlakshi Finance Corporation Ltd. AIR 1992 SC 771. ( iii ) Assistant Controller of Central Excise v. Dunlop India Ltd. [ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scussed, in detail, in this order, in the ensuing paragraphs. 6.5 In view of the factual discussions of the case and having regard to the binding judicial precedent within the meaning of article 141 of the Constitution of India, the said decisions of Hon'ble Supreme Court, mentioned in para 6.3. above are binding in nature, on all courts and tribunals, in the territory of India, and also in the light of case-laws of binding precedent cited by the assessee, as indicated in para 6.1 above. Needless to say that the case laws relied upon by the assessee, in the context of binding nature of judicial precedent covers the factual decision of the present case, on the issue of amendment, to the original Trust Deed and, hence, the same are binding on all courts and tribunal in the country and, hence, respectfully followed. In view of this clear factual position of the present case, the above cited decisions, as relied upon by the assessee, does not support its case, in the face of clear judicial verdicts of the Hon'ble Apex Court, in the cases referred to above and discussed in detail in the ensuring paragraphs of this order. 6.6 The assessee trust placed reliance on the decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 80G(5) of the Act. 6.10 The assessee, further, quoted provisions of section 2(15) and also placed reliance on the decision of the Hon'ble Supreme Court, in the case of Andhra Chamber of Commerce ( supra ), which defines the 'charitable purpose'; "The statutory definition is not exhaustive or exclusive. Even if the object or purpose may not be regarded as charitable in its popular signification as not tending to give relief to the poor or for advancement of education or medical relief, it would still be included in the expression "charitable purpose" if it advances an object of general public utility." 6.11 The assessee also placed reliance on the decision of Hon'ble Supreme Court, in the case of Sole Trustee, Loka Shikshana Trust ( supra ), which defines the concept of charity, as under: 'The very concept of 'charity' denotes altruistic thought and action. Its object must necessarily be to benefit others rather than one's self. The action which flows from charitable thinking is always directed at benefiting others. It is his direction of though and effort and not the result of what is done in terms of financially measurable gain which determines that it is char ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case(s) of Upper Ganges Sugar Mills Ltd. ( supra ), State of Kerala v. M.P. Shanti Verma Jain [1998] 231 ITR 787 (SC), Arsha Vijnana Trust v. D.P. Sharma , I.R.S., DIT (Exemption) [2007] 295 ITR 437/[2008] 171 Taxman 182 (AP) and Hon'ble Jurisdictional High Court of Punjab Haryana, in the case of CIT v. Guryani Brij Balabh Kaur Trust [1980] 125 ITR 381/4 Taxman 13 (Punj. Har.), are applicable to the fact-situation of the present case and directly deal with the provisions of section 80G(5)(iii) of the Act, which are relevant and subject matter of the present appeal. 7.2 The decisions relied upon by the assessee are not applicable to the fact situation of the present case. Income of a Charitable Trust is exempt according to the provisions of sections 11, 12, 12A, 12AA and 13 of the Act. The Trust should be one established in accordance with law and its objects would fall within the definition of term 'Charitable purpose', as contained under section 2(15) of the Act. Besides, there are specific provisions relating to public charitable/religious trust under section 10 of the Act. Provisions for exemption of public religious trust under section 11 or 10(23C)(v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct-situation of the present case, as the provisions of section 80G(5)(iii) read with Explanation-3, to section 80G(5C) of the Act, are the subject matter of the assessee's appeal. 7.5 To support his contention, the Ld. Counsel for the assessee, also placed reliance, on the decision of the Hon'ble Rajasthan High Court, in the case of Umaid Charitable Trust ( supra ). On the special fact situation of the above case relied upon, the Hon'ble Court, recorded that there was no clause in the petitioner's trust deed which indicated that income of the petitioner's trust was to be applied wholly or substantially for any particular religion. In the present case, clause 5 of the trust deed specifically provided that the income of the "Trust Properties" would be first applied, for the repair and maintenance of the temple. Further, the preamble to the said trust deed clearly spells out the intention of settlers for construction of temple of deity Laxminarayan, for the purpose of worship of the said deity and adoration of the same, including holding of periodical festivals of the said deity. Each limb and text of the trust deed clearly manifested that the trust is expressed to be for the be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nunciated by Shankaracharya, but the wholly worldly and pragmatic concept of particular religious community. The religious aspect cannot be conceived in purely abstract terms devoid of ground realities. The original Trust Deed as well as the unauthorizedly amended trust deed are clearly expressed to be for the benefit of a particular religion community, as is evident from the detailed discussions, in the ensuing paragraphs of this order. 7.9 The practical and pragmatic but vital aspect of the religion has been adjudicated by the Hon'ble Supreme Court, in the case of Upper Ganges Sugar Mills Ltd. ( supra ), and in the case of V.M. Shanti Verma Jain ( supra ). Therefore, it is respectfully submitted that decisions of the Hon'ble Supreme Court, being binding on all courts and tribunals, in the territory of India under article 141 of the Constitution of India, is respectfully followed, as the decision of the Hon'ble Rajasthan High Court, is not applicable to the terms of object clause of the Trust in question. It is further added that India is not a theocratic state but secular state, as enshrined in the Constitution of India, the supreme law of the land. The State has no relig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar-1, Amritsar, on 22.04.2010, after a gap of one year and eight months, from the purported resolution, dated 01.08.2008, as recorded at the back of the stamp paper. In the impugned supplementary deed, it is recorded that by way of resolution passed and recorded, in the minutes book, on 01.08.2008 and corrigendum written, on 01.08.2008, w.e.f. 01.08.2008, the dause-4 of the original Trust Deed dated, 20th Dec., 1993, was deleted and four other objects were added to the impugned original Trust Deed. The Ld. CIT, mentioned in para 4 of his order that the original trust deed was expressly established for the benefits of a particular religious community and, hence, it contravenes the statutory provisions of section 80G(5)(iii) of the Act. It was, further, observed by the CIT, in his order under section 80G of the Act that the corrigendum, in question, totally changed the complexion and objects of the original trust. 7.12 The Ld. CIT, further, observed that in-fact a new trust should have been constituted which the assessee has not done, to reap the benefit of section 80G retrospectively. It was, further, observed by the CIT that it would be pertinent to refer to Sl. No.4 of assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (iv) of Section 80G(5) of the I.T. Act, 1961. The corrigendum aforesaid brought into existence virtually a new trust which has totally changed the complexion and objectives of the Trust. In fact, a new trust should have been constituted which the assessee has not done to reap the benefits of section 80G, retrospectively. In this connection, it would be pertinent to refer to S.No.4 of assessee's application in F. No. 10G for grant of approval under section 80G(vi) of the I.T. Act, 1961 submitted on 20.3.2008. This clause nowhere mentions the corrigendum, if any, executed and annexed thereto. In view thereof it can well be concluded that the corrigendum submitted later on is an afterthought and a self serving document submitted especially when put to question by this office and it is just to enjoy the benefits under section 80G of the Act, retrospectively. It is simply an act to undone the work which has already been done. It cannot override the aims and objects of the trust deed originally executed which are basically religious in nature. My view finds force from the decision pronounced by the Hon'ble Allahabad High Court in the case of Shervani Charitable Trust v. CIT [1968] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he very concept of Trust and its creation. A 'Trust' is an obligation annexed to the ownership of the property and arising out of confidence reposed in and accepted by the owner or declared and accepted by him for the benefit of another and the owner. The irrevocability of the Trust is an essential ingredient of a valid Trust, which has been violated by the settlers by way of effecting unauthorized alterations to the original Trust Deed. The Original Trust Deed, in the present case, does not confer any power on any one, to effect alteration or to make addition or deletion or to amend its original object clause, contained therein. In view of this, the authors or Trustees of this Trust does not have any jurisdiction, to delete clause 4 of the original trust deed and add other new objects, to the original Trust Deed. This view is upheld by several decisions of Hon'ble Supreme Court, which are binding, on all Courts and Tribunal within the territory of India, in view of Article 141 of the Constitution of India. This article of the Constitution of India lays the foundation of the Doctrine of binding precedent. ( i ) In the case of Sri Agasthyar Trust ( supra ), it has been held as u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the trust became an irrevocable trust. The powers of the trustee in respect of the said trust continued to remain the same as set out in clause (8) of the partnership deed. The trustee was only required to carry out the objects of the trust and spend the trust funds for charitable purposes in the manner indicated therein. No power was given to the trustee to amend, alter, vary or change in any manner the objects of the trust as created in 1941. This being so, the document dated July 1, 1944 executed by the trustee was clearly without any authority and was non est. The trust as originally established by the deed dated November 28, 1941, remained unchanged or unaffected by the later document date July 1, 1944. Therefore, what had to be seen was whether, by reason of the partnership deed dated November 28, 1941, the trust which had been constituted was a public charitable trust or not. This question was gone into by the Madras High Court when it had to decide an appeal arising out of the judgment in a suit instituted by Nanjam Chettiar, one of the partners of the firm which had established the trust. Division Bench of that court by its judgment dated October 26, 1951, in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mahal Trust ( supra ), the Hon'ble Supreme Court, held as under: "Charitable Trust - Trust for construction of a Shadi Mahal and Establishing other Institutions for Educational, Social and Economic advancement of Muslims - General Body meeting clarifying that the income and the Mahal shall be made available to all communities - Clarification clause of Trust Deed enabling Trustees to decide meaning and scope of clause of Trust deed-Amendment by General Body not permissible- Benefit under Trust available to all Muslims - Not limited to Muslims of Kerala who alone are of backward classes - Trust not covered by Expln. 2 to section 13 - Trust not exempt from Tax - Income Tax Act, 1961." ( iii ) Further, the Hon'ble Supreme Court, in the case of Kamla Town Trust ( supra ), held that any change in Trust Deed is not possible unless the deed itself provides for such change. 7.18 Thus, three decisions of the Apex Court, on identical issue are bindings on all court and Tribunal in the territory of India, as discussed earlier. Incidentally, decisions of Hon'ble High Courts, are discussed hereunder merely to demonstrate that there is uniformity, in the decisions of High Courts, also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amend a trust deed since a trust by its inherent nature is irrevocable. Therefore, it is important to provide the amendment clauses in the trust deed itself. There is no power or jurisdiction conferred on the settler or the trustee to amend the original Trust Deed, dated 24th Dec, 1993, as no such power is provided by the settlers of the Trust in the said Trust Deed. 7.20 However, it is pertinent to add here that if the amendment clauses provided in the trust deed are too wide, then the trust may not be treated as irrevocable, which is essential ingredient for a valid Trust. In the trust deed where there is no mention about amendment, the amendment has to be done with the permission of a civil court. Even the Civil Courts do not have unlimited powers of amendment. The civil Courts permit amendment under the doctrine of Cypres, which means the original intent of the settler should prevail. Therefore, only such amendments can be made which are in line with the original intent of the seller. It may, further, be noted that even the settler does not have powers to amend the trust deed. 7.21 It is generally a legally well settled principle of trust law that once a trust is create ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sputed fact that in this case, the settlers of the Trust did not provide for any amendment to the said original Trust Deed. 7.24 In view of the above legal and factual discussions and the binding decisions of the Hon'ble Supreme Court, as discussed above, the amendment in the form of deletion of clause (4 ) of the original trust deed and addition of certain other objects, to the said original trust deed is void ab-initio, as no power is conferred under such original trust deed, for such alteration, deletion or addition. In this context, it is pertinent to highlight that procedure for amendment to the Trust Deed is prescribed under section 26 of the Specific Relief Act, 1963 and Section 92 of Civil Procedure Code, 1908. The assessee trust, in the present case has not followed the said prescribed procedure, as the deletion of clause (4) from original trust deed is made by way of mere resolution, by trustees/settlers. Civil Courts or High Courts are competent to amend the Trust Deed, which does not provided for any amendment to the object clause. 7.25 A civil court has been conferred with the power to amend a trust deed and the Income Tax Officer has to take notice of such ame ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, it is important to provide amendment clause in the trust deed itself. To be precise, in the present case, no such amendment 'clause has been provided in the impugned Original Trust Deed. Consequently, there being no amendment clause, in the original trust deed, any amendment has to be done through a Civil Court. No such amendment has been carried out, in the impugned Original Trust Deed, through any civil court, in the instant case. The assessee-trust by mere resolution passed by the settlers, deleted the impugned clause (4) from right from the beginning as if this was never been the part of the trust deed and added new objects, contrary to the mandate of the settlers, as contained in the said Trust Deed and, hence, such deletion or addition is invalid. It is also an undisputed and legally settled proposition that the amendment made should be in line with the original intention of the settlers and should not negate or deviate from the original intention of the settlers. In the present case, the assessee trust demolished the clause No.4 of the original Trust Deed contrary to the intention of the settlers. 7.28 It is pertinent to mention here that the vital and paramount legal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e without jurisdiction and invalid and, hence, with no attendant legal consequence, on the original Trust and original Trust Deed, dated 20th Dec, 1993. 9. Next primary issue, for consideration, is whether on facts and in law of the case, such trust is entitled for approval, under section 80G(5) of the Act. A bare perusal of the trust deed dated, 20th Dec, 1993, clearly reveals that the trust has been expressed to be for the benefit of a particular religious community i.e. Hindu religious community. The trust has been formed, for the purpose of construction of Laxmi Narayan Temple, for doing worship of the Deity and holding periodical festivals of the Deity, including maintenance and upkeepment of the temple, as per object of the trust. The income of the Trust is firstly to be applied for the maintenance and repair of the Temple and to hold periodical festivals of the said deity. For the purpose of proper appreciation of the text and contents and true nature of the original object clause of the said trust deed, the same is reproduced hereunder: (A) "Public Charitable Trust This Deed of Public Charitable Trust is made on the 20th day of December, 1993 by the following person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esaid, the Trustees do hereby divest themselves of all ownership, control and employment or the Trust Properties and grant, convey, transfer, give, assign, assure and dedicate the same absolutely and for ever unto and in favour of the deity, so as to vest the same in the said deity free from all encumbrances, in the manner hereinafter indicated and deliver possession thereof unto and in favour of the deity. AND THE SAID Trustees do hereby constitute, appoint and nominate themselves as Trustees for the aforesaid properties. 3. The Trustees shall not have the power to sell or mortgage or charge or otherwise encumber the Trust Properties. 4. If any Trustee renounces the Hindu religion or transfers any portion of the Trust Properties in violation of the condition hereinbefore recited, then he or she shall for the purpose of this deed be considered to be dead and the person next after him or here entitled to succeed as Trustee, shall succeed. The Trustee for the time being shall hold the Trust Properties and manage the same to the best advantage of the Trust. 5. The income to the said Trust Properties shall be applied first in the maintenance and repair of the temple prope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is chaired by Swami C.B. Acharya. Sd /- Sd /- Sd /- C.B. Ramanujam Janak Raj Vijay Sharma and three others " (C) The corrigendum to the Trust Deed Dated 20th December, 1993, is reproduced hereunder: "This Deed of corrigendum is executed at Amritsar this day of 01.08.2008 is as under: That the trust has decided to amend/delete certain things as decided mutually as stated below: 1. That the clause No.4 of the original trust deed dated 20th Dec,, 1993 stands deleted right from beginning as if this was never been the part of the trust deed. 2. That the trust has decided to change the objects and has decided to involve itself in the acts of service to the society which includes a. constructions of dharma shalas, community halls. b. Setting up and running of charitable hospital. c. Helping the deserving parents to solemnize the marriage of their daughters. d. Advancement of any other objectives of general public utility, not involving the carrying on of any activity for profits, as the law may regard as public charitable purposes. 3. That the Trustees shall be lif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9.1 The undated affidavit signed by deponent Ravi Sharma S/o Sh. Bishan Dass, duly attested by Notary on 18th March, 2010, was filed before Bench. It is pertinent to reproduce clause 10 of the said affidavit "10. That before 31.08.2008 there was one object i.e. construction of Mandir and, therefore, only one utilization account was coming and no detailed narration was appearing in the books as utilization was only on account of construction of Mandir." 9.2 A bare reading of the above clause of the said affidavit clearly establishes that the original Trust dated 20th Dec, 1993, was formed with sole object of construction of Laxmi Narayan temple, as discussed earlier, in detail. Such trust with the such object of construction of temple for the purpose of worshiping the said deity, application of the income from trust properties for repairs/maintenance of temple and holding periodical festivals of the deity, in the light of express provisions of section 80G(5)(iii) of the Act, which reads as "(iii) the institution or fund is not expressed to be for the benefit of any particular religious community" cannot be construed as "non-religious or secular" object. The Trust is patently ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the philosophical side of the religion but also religious practice, as laid down, in the tenets of nature - religious sects. Religious practices or performances of acts, in pursuance of religious belief are as much a part of a religion as faith or belief, in particular doctrine. Thus, if the tenants of the Jain or Parsi or Hindu religion laid down that the certain rites or ceremonies are to be performed at certain times and in a particular manner, it cannot be said that these are secular activities and not 'religious activities'. In view of this, it is beyond doubt that the assessee trust is expressed to be for the benefit of a particular religious community, namely, the Hindu religious community and, hence, contravenes the provisions of section 80G(5)(iii) of the Act. 10.1 The republic of India was conceived and made secular from the very beginning. In the conception of secularism, the common element is the absence of state-sponsored or state favoured religion. The element has been bed-rock, in shaping the Constitution of India. The secularism is the basic feature of the Indian Constitution, hence, beyond the amendatory power of the Parliament. It is based on equal respect for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s decision was affirmed by the Supreme Court in Upper Ganges Sugar Mills Ltd. ( supra ). It was observed that it is true that such prayer halls may be available to all religions but on that account the object of setting up places of worship and prayer halls do not cease to be a religious object. 14. The factual matrix of the present case, as discussed above, in detail clearly establishes that the original Trust deed, dated 20th Dec, 1993, was created wholly for a particular religious community and, thus, it contravenes the express provisions of section 80G(5)(iii) of the Act. This view is fully supported and upheld by the Hon'ble Supreme Court, in the land mark decision, in the case of Upper Ganges Sugar Mills Ltd. ( supra ), as is evident from the text of the decision, reproduced hereunder: " Donations - Special deduction - Scope of section 80G - Trust for charitable purposes - One of the purpose of trust which is religious - Donation to such a trust would not be entitled to special deduction under section 80G - Clause in trust deed permitting trusts to support prayer halls and place of worship - Trust Fell outside the ambit of section 80G. Section 80G of the Income-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eed which permits the trustees to support prayer halls and places of worship sets out a purpose the whole or substantially the whole of which is of a religious nature, and this has not been seriously disputed. Therefore, in our view, the trust and the donation by the assessee to it fall outside the scope of section 80G" 14.1 In the present case, fact-situation of the case, in the light of object clause expressing clearly the intent of the settlers of the Trust, for construction of said temple of the said deity, for the purpose of worshiping the deity and its adoration, including holding periodical festivals for the deity, is squarely covered by this decision of the Hon'ble Supreme Court, wherein there was only one object out of dozens which was considered by the Court as religious one. Such an object clearly violates the provisions of section 80G(5)(iii) of the Act. Consequently, the impugned order of the CIT cannot be assailed, on facts, law and judicial precedent, laid down by the Hon'ble Supreme Court and express provisions of section 80G(5)(iii) r.w. Explanation 3 to section 80G (5C) of the Act. 14.2 The similar view has been upheld by the Hon'ble Supreme Court, in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 80G(5)(iii) which lays down that charitable purpose does not include any purpose of the whole or substantially the whole of which is of a religious purpose. From the date of its constitution in 1983, the assessee-trust had published various books mostly in Telgu and English. These books included the translations of Sanskrit Ramayana, Mahabhartha Gita with Sankara Bhashyam. The trust was given benefit u/s 80G of the Act from its establishment without interruption till a notice was given in January, 2003, and an order was subsequently passed holding that the trust had contravened the provisions of section 80G(5)(iii) of the Act and accordingly the request for renewal of exemption was not granted. On a writ petition against the order: Held, dismissing the petition, that the petitioner was not entitled to the benefit u/s 80G. The fact that the benefit had been granted for a long period of twenty years by misconstruing the law, would not be a bar for the Director of Income-tax (Exemptions) to pass an order when an application for extension of grant of exemption was made before him." 14.4 Similarly, the Hon'ble Delhi High Court, in the case of Kirti Chand Tarawati Charit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e principle of res judicata, as the approval was granted u/s 80G, in the past, on misreading and misconstruction of the provisions of section 80G of the Act. The misconception and misinterpretation of such provisions of the Act led to miscarriage of justice and violation of such express provisions of the Act. The judicial conscience cannot allow perpetuation of such mistake. Further, it is no judicial heroism, to allow such mistake to perpetuate, on the foundation of misinterpretation of law in the past. The Hon'ble Supreme Court in the case of Union of India v. Raghubir Singh [1989] 178 ITR 548 Sri Agasthyar Trust ( supra ) has clearly held that if the previous decision is plainly erroneous, there is a duty of the court to review it and not perpetuate the mistake i.e. vital point, was not considered or when an earlier relevant statutory provisions were not considered. In the present case, the approval under section 80G of the Act, was granted by the earlier CIT, on misconception of statutory provisions of section 80G of the Act. Therefore, such misconception of the statutory provisions cannot be a fetter, on the power of the, subsequent competent authority i.e. CIT, to i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... still the organic part of the said Deed. These objects are purely religious in nature, inextricably linked to the Hindu religious community and its Deity 'Laxmi Narayan'. There cannot be any dispute on this vital issue, in the present case. Hence, even the unauthorized amended Trust Deed contravenes the provisions of section 80G(5)(iii) of the Act, being expressed to be for the benefit of a particular religious community. 16 . If the objects of a trust include Charitable as well as religious purpose, the deduction under section 80G of the Act, would not be permissible, in respect of donations made to such trust, as held by the Hon'ble Supreme Court, in the case of East India Industries ( Madras ) (P.) Ltd. v. CIT [1967] 65 ITR 611 (SC). In another case, Upper Ganges Sugar Mills Ltd. ( supra ), the Apex Court held that if anyone of the objects of a trust is wholly and substantially, of a religious character, it falls outside the scope of section 80G of the Act. The trust spent Rs. 41,69,890/- on the construction of the said temple, as is evident from page 18 of the paper book. 17. Further, after unauthorized and invalid amendment, as discussed in detail earlier, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. CIT is upheld and, consequently, the appeal of the assessee is dismissed. 19. In the result, the appeal filed by the assessee sands dismissed. Reference under section 255(4) of the Income-tax Act, 1961 There is a difference of opinion amongst the Members constituting the Bench in the aforesaid appeal, therefore, the following questions need to be referred to the Hon'ble President for nominating the Third Member under section 255(4) of the Income tax Act, 1961:- "(1) Whether on the facts and in the circumstances of the case and the record available, the assessee is entitled for grant of approval of renewal of exemption under section 80G(5) of the Income tax Act, 1961? (2) Whether on the facts and in the circumstances of the case, the CIT can overlook the binding precedent of the order dated 19-12-2008 passed by the ITAT, Amritsar Bench in assessee's own case in ITA No.512(ASR)/2008 in para Nos.9 and 10, page No.5, holding that the learned CIT erroneously rejected the said corrigendum as a mere afterthought and not having any binding force and in the absence of any provision of law prohibiting the assessee from amending the original Trust Deed by way of corrigendum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ances of the case, the CIT can overlook the binding precedent of the order dated 19-12-2008 passed by the ITAT, Amritsar Bench in assessee's own case in ITA No.512(ASR)/2008 in para Nos. 9 and 10, page No.5, holding that the learned CIT erroneously rejected the said corrigendum as a mere afterthought and not having any binding force and in the absence of any provision of law prohibiting the assessee from amending the original Trust Deed by way of corrigendum? (3) Whether on the facts and in the circumstances of the case, the learned CIT can refuse the approval of renewal of exemption under section 80G(5) of the Income-tax Act, 1961 on the ground that one of the objects No. 4 that the assessee-trust has been established for a particular religious purpose for the followers of the diety, who have to be only Hindus, in spite of the fact that he has already granted the approval of renewal of exemption in many times under section 80G(5) of the Income tax Act, 1961?" THIRD MEMBER ORDER H.L. Karwa, Vice-President (As a Third Member) - This appeal was heard by the Division Bench. The order was proposed by Ld. Judicial Member. The Ld. Accountant Member did not agree to the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resident as a Third Member u/s 255(4) of the Income Tax Act, 1961 to resolve the controversy. 4. At the very outset, I may point out that the controversy involved in the present appeal can be resolved with reference to the first question referred to by Ld. JM, which reads as under:- "Whether on the facts and in the circumstances of the case and the record available, the assessee is entitled for grant of approval of renewal u/s 80G(5) of the Income Tax Act, 1961"? 5. Now, I proceed to decide the above question. In order to understand the real controversy, I think it necessary to narrate the brief facts of the case. The assessee Trust (Ramanujam Spiritual Charitable Trust) has been established vide Trust deed dated 20.12.1993 with the following objects and purposes:- "Whereas the Trustees are desirous of creating a Trust with temple of deity at Vrinda Van by the name of Laxmi Narayan in the said temple for undertaking spiritual mission to propagate the thoughts and philosophy of Ramanujam and for spiritual education of public in general and for the worship and adoration of the diety; And Whereas the temple with the deity (Laxmi Narayan) will serve as a centre of spiritu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the same and shall be spent in the daily worship of the said diety and in defraying the expenses of the usual festivals, with full liberty to apply a portion of such income to the improvement of the Trust Properties, as detailed in First Schedule (attached). 6. The Trustees shall cause accurate accounts to be kept of all moneys received and spent and of all matters in respect thereof in course of management of Trust Properties and in relation to the carrying out of the objects and purposes of the Trust as well as of all aspects and effects of the Trust Properties. The Trustees have contributed Rs. 1,000/- (Rs. One thousand only) each totalling initial deposit to Rs. 3,000/- as shown in Second Schedule. 6. The trust was registered with the Sub Registrar, Chandigarh on 20.12.1993 and up to 31.3.2008, the trust was granted renewal u/s 80G(5) of the Income-tax Act, 1961 (in short 'the Act') by CIT-I, Amritsar vide his order dated 14.9.2005. The Trust is having its registered office at H. No. 198, C/o Varinder Mahajan, Tilak Nagar, Amritsar. The assessee submitted an application dated 26.3.2008 before the CIT-I, Amritsar for renewal of approval u/s 80G(5), which has been rej ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n ceases to remain a trustee. According to him, this object (clause No.4 of Trust deed) is sufficient evidence to prove that the Trust was established for a particular religious purpose. He further observed that the provisions of section 80G(5) read with section 2(15) of the Act, under the circumstances make it clear that a trust or fund will not qualify to be approved u/s 80G for getting donations made exempt from tax. The argument made on behalf of the assessee that the approval for renewal had been given by earlier CIT under the similar circumstances has been rejected by the CIT holding that any order passed erroneously or inadvertently is not legally binding on the Income-tax Authorities while reconsidering the case for granting renewal. Keeping in view the provisions of sub section (5)(iii) read with Explanation 3 of Section 80G of the Act. the CIT vide order dated 26.8.2008 held that the trust is not entitled to be registered for the purpose of section 80G and rejected the application for approval of renewal u/s 80G of the Act. 6.3 The assessee's Trust filed an appeal against the order of CIT dated 26.8.2008 before the Tribunal and the Tribunal vide its order dated 19,12. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d objects of the trust deed originally executed which are basically religious in nature. My view finds force from the decision pronounced by the Hon'ble Allhabad High Court in the case of Shervani Charitable Trust v CIT [1968] 69ITR 750 (All.) wherein it is held that the trustees do not have any power to override the trust deed through a resolution by virtue of which the non-charitable portion of the income could also be applied to charitable purposes. The above discussion is summed up as under:- ( i ) The accounts of the assessee are silent as to the nature of the expenditure incurred for any charitable purposes. ( ii ) The corrigendum has been submitted by it only when it has been questioned about the trust being, overwhelmingly by religious in nature, thus not entitled to benefits of section 80G. The so called corrigendum was an after thought. ( iii ) In view of the decision of Hon'ble Allahabad High Court in the case of Shervni Charitable Trust v CIT [1968] reported as 69 ITR 750 (All.), the trustees cannot convert a partial trust into a wholly charitable trust. The trustees do not have any power to override the trust deed through a resolution by virtue of wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. AM has also held that it is well settled principle of Trust law that once a Trust is created with certain objects, no one has power to delete any object or whole of objects where no such power is provided, in the original Trust Deed. The Ld. AM has also taken note of Supplementary Trust Deed dated 21st day of 2010 (month not mentioned), which was filed first time before the Tribunal, and discussed the legal consequences of unauthorisedly amended original trust deed, particularly deletion of clause (4) of objects of the original Trust deed and addition of certain other new objects. He observed that even in a situation of deletion of clause (4) of objects of the original Trust Deed, the Trust remains a Trust, expressed to be for the benefit of particular religious community, i.e. Hindu religious community. In this regard, the Ld. AM observed that the preamble to the original Trust Deed whereby the said settlers expressed desire of creating a Trust Temple for Deity by the name - 'Laxmi Narayan' and construction of the said temple remains, integral part of the said amended Trust Deed. The immovable property, as comprised in the 1st Schedule to the said Trust Deed remains untouched. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Aggrwal, Ld. Counsel for the assessee submitted that on the basis of Corrigendum dated 1.08.2008 and supplementary Trust deed, the Trust is eligible for renewal of approval u/s 80G(5)of the Act. 12 . Shri Laxman Singh, Ld. C1T DR vehemently argued that the assessee trust is not entitled to be registered for the purpose of section 80G and no approval for renewal could be granted in any manner. While referring to object No. 4 of the Trust deed dated 19.12.1993, Shri Laxman Singh, CIT DR submitted that the trust has been established for a particular religious community i.e. Hindu and, therefore, the trust could not be treated to have been established for charitable purposes in view of the conditions laid down in section 80G(5)(iii) read with Explanation 3 of the Act. Reliance was placed on the decision of the Hon'ble Supreme Court in the case of Upper Ganges Sugar Mills Ltd. ( supra ). He further submitted that corrigendum dated 1.8.2008 and so called supplementary trust deed dated 21st day of 2010 (date not mentioned) are non est and merely scrap of paper because neither the trustees nor the founders have power to alter the provisions of the original trust deed dated 19.12. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of a religious nature. " 15. In the original Trust Deed, it is stipulated that the trustees are desirous of creating a trust with temple of a deity at Vrinda Van by the name of 'Laxmi Narayan' in the said temple for undertaking spiritual mission to propagate the thoughts and philosophy of Ramanujam and for spiritual education of public in general and for the worship and adoration of the deity It is also provided in the trust deed that in pursuance of pious wish and desire and in the consideration of religious service and benefits and for other good reasons and considerations, the Trustees dedicate the Trust properties for the cost of construction of the said Temple and to secure the worship of the said deity and of making a Public Charitable Trust of the said Trust properties. It is also mentioned in clause 4 of the trust deed that if any Trustee renounces the Hindu religion or transfers any portion of the Trust properties in violation of the conditions stipulated in the deed then he or she shall for the purpose of this deed be considered to be dead. Clause 5 of the said trust deed provides that the trust properties shall be applied first in the maintenance and repair of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the donation by the assessee to it fall outside the scope of section 80G." In the above case, Hon'ble Supreme Court held that clause 2(h) of the trust deed in question which permitted the trustees to support prayer halls and places of worship set out a purpose, the whole or substantially the whole of which, was of a religious nature. Applying the ratio laid down by the Hon'ble Supreme Court in the case of Upper Ganges Sugar Mills Ltd. ( supra ), to the facts of present case, I am of the considered opinion that Trust is not entitled to any relief on the basis of original Trust Deed dated 20.12.1993. 17. The next argument of Shri Anil Aggarwal, Ld. Counsel for the assessee was that there was no justification in denying exemption u/s 80G(5) of the Act in terms of the objects set out in the original trust deed, dated 20.12.1993 particularly when the earlier CIT had granted registration and renewal of approval to trust for the purposes of Section 80G of the Act upto 31.03.2008 vide his order dated 14.9.2005. In my opinion, the above argument of Shri Aggarwal, Ld. Counsel for the assessee is also not tenable in view of the decisions relied upon by the Ld. CIT DR, Shri Laxman S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atter to CIT with a direction to decide the same afresh in accordance with law after taking into consideration the Corrigendum filed by the assessee and effect thereof on the objects of the trust for the purpose of renewal of approval u/s 80G(5) of the Act. The Tribunal has nowhere directed the CIT to grant the renewal of approval u/s 80G on the basis of corrigendum dated 1.1.2008. Therefore, in the absence of such findings, the arguments advanced by Sh. Aggarwal, Ld. Counsel for the assessee are devoid of any merit. In the instant case, the counsel of the assessee has referred to certain words and sentences of the order of the Tribunal and claimed that the same is final verdict of the Tribunal. The view entertained by the Ld. counsel for the assessee is against law. It is well settled law that the order/judgment must be read as a whole and the observations from the order/judgment have to be considered in the light of the issue/s which were before the Tribunal. If the order of the Tribunal dated 19.12.2008 is read as a whole, the only irresistible conclusion which can be drawn is that the Tribunal after taking into consideration the facts and circumstances .of the case remanded the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce no power has been given either to trustees or to the founders to amend, alter, vary or change in any manner the objects of the trust as created in 1993. 24. In my considered opinion there is substantial force in the above submissions of Laxman Singh, Ld. DR keeping in view the decision of Hon'ble Supreme Court in the case of Sri Agasthyar Trust ( supra ), wherein the Hon'ble Supreme Court held (at pages 32 33) as under:- "We have already observed, the deed of 1941 originally gave the power to the founders to revoke the trust but this power was taken away by a subsequent document which was executed on August 26, 1943. It is thereafter that the trust became an irrevocable trust. The powers of the trustee in respect of the said trust continued to remain the same as set out in clause (8) of the partnership deed which has been extracted hereinabove. The said trustee was only required to carry out the objects of the trust and spend the trust funds for charitable purposes in the manner indicated therein. No power was given to the trustee to amend, alter, vary or change in any manner the objects of the trust as created in 1941. The result of this is that neither the trustee n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dly created, any deviation by the founder of the trust or the trustees from the declared purposes would amount only to a breach of trust and would not detract from the declaration of trust. Therefore, the subsequent conduct of the founder in dealing with the funds of the trust long after the creation of the trust may not put an end to the trust itself" We are in full agreement with the principle stated in the aforesaid passage and we hold that the trustee had no authority or jurisdiction to execute a fresh trust deed and the document dated July 1, 1944, is of no consequence and is no more than a scrap of paper. The trust as originally established by the deed dated November 28, 1941, remained unchanged or unaffected by the later document dated July 1, 1944. " 25. From the above judgment of Hon'ble Supreme Court, it is clear that when the founders of the trust have no power to alter or vary the terms of the trust, a trustee appointed to manage the properties of the trust for securing its object, can under no circumstances be regarded as having such a power especially when the original trust deed does not bestow such power on him. In the above case, Hon'ble Supreme Court held th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of unauthorisidely amended Trust Deed. Further, holding of periodical festivals of the Deity and offering daily worship, are still the organic part of the said Deed. The Ld. A.M. has correctly observed that these objects are purely religious in nature, inextricably linked to the Hindu religious community and its Deity 'Laxmi Narayan'. According to Ld. AM, even the unauthorized amended Trust Deed/so called supplementary Trust Deed contravenes the provisions of section 80G(5)(iii) read with Explanation 3 of the Act, being expressed to be for the benefit of a particular religious community i.e. Hindu. 26. Viewed from any angle, I am in agreement with the views expressed by the Ld. A.M. in his dissent that in the facts and circumstances of the present case, the Trust is not entitled to renewal of approval u/s 80G(5) of the Act. 27. The matter may now be placed before the regular Bench for the disposal of the appeal in accordance with the majority opinion. ORDER Per Bench - While disposing of the appeal, there was a difference of opinion between the Members constituting the Division Bench and, therefore, the following questions were referred to the Third Member under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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