TMI Blog2016 (2) TMI 569X X X X Extracts X X X X X X X X Extracts X X X X ..... of argument. We quote all this material and findings on record to hold that the assessee is not an institution expressed to be for the benefit of any particular religious community or caste u/s. 80G(5)(iii) or having any purpose the whole or substantially the whole of which is of religious nature under explanation 3 therein. We accept assessee's arguments and reject those raised at Revenue's behest. The assessee's registration petition u/s. 80G(5) succeeds accordingly. - Decided in favour of assessee - ITA No. 330/Rjt/2015 - - - Dated:- 18-1-2016 - S. S. Godara, JM And Manish Borad, AM For the Appellant : Shri Yogesh Pandey, DR For the Respondent : Shri Kalpesh Doshi, AR ORDER Per S. S. Godara, Judicial Member This assessee's appeal, arises from order of the Principal CIT(OSD)(Exemptions), Ahmedabad dated 23-04-2015 in appeal no. Pr.CIT(E)/Ahd/80G/Raj-21/2015-16/28, in proceedings under section 80G(5) of the Income Tax Act, 1961; in short the Act 2. The assessee's sole substantive ground challenges the CIT(E)'s order denying it section 80G(5) registration. Facts of the case are in a narrow compass. The assessee, a trust already enjoys secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 5. We have heard both the parties. There is no dispute about the fact that the assessee-trust is registered as a religious trust. Its objects are nowhere in dispute. We notice from its income and expenditure account that the assessee has not spent even a single penny in its religious activities in furtherance to the corresponding objects. Its expenditure on education, medical relief and relief to poor totaling to ₹ 87,558/- comprises of ₹ 49,725/-, ₹ 23,853/- and ₹ 13,980/-; respectively under the said heads in the accounting year ending on 31-03-2015. A perusal of section 80G(5B) inserted by the Finance Act,1999 w.e.f. 01-04-2000 makes it clear that the same is in the nature of non-obstente clause providing that where an institution or fund which incurs expenditure during any previous year of religious nature for an amount not exceeding 5% of its total income in that previous year is deemed as an institution or fund to which provision of this section applies. We quote facts narrated hereinabove that even if the assessee is held to be a trust of religious nature subject to our final adjudication hereunder, it is still entitled for the benefits of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 11 and 12 or clause (23 AA) or clause (23 C) of section 10 : Provided that where an institution or fund derives any income, being profits and gains of business, the condition that such income would not be liable to inclusion in its total income under the provisions of section 11 shall not apply in relation to such income, if (a) the institution or fund maintains separate books of account in respect of such business: (b) the donations made to the institution or fund are not used by it directly or indirectly, for the purposes of such business; and (c) the institution or fund issues to a person making the donation a certificate to the effect that it maintains separate books or account in respect of such business and that the donations received by it will not be used, directly or indirectly, for the purposes of such business; (ii) the instrument under which the institution or fund is constituted does not, or the rules governing the institution or fund do not, contain any provision for the transfer or application at any time of the whole or any part of the income or assets of the institution or fund for any purpose other than a charitable purpose; (iii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Institution or fund since its inception or during the last three years, whichever is less. 7. Sub-rule (3) empowers the Commissioner to call for such documents or information from the institution or fund or cause such enquiries to be made as he may deem necessary in order to satisfy himself about the genuineness of the activities of such Institution. Sub-rule (4) lays down that if all the conditions as enumerated in clause (1) to (v) of sub-section (5) of section 80G are fulfilled by the institution or fund, CIT shall record such satisfaction in writing and grant approval to the institution or fund specifying the assessment year or years for which the approval is valid. Sub-rule (5) empowers the CIT to reject the application for approval after recording the reasons for such rejection in writing where the CIT is satisfied that one or more conditions laid down in clause (i) to (v) of section 80G(5) are not fulfilled. This rule also states that no order rejecting the application shall be passed without giving an opportunity of hearing to the institution or trust. Sub-rule(6) requires the CIT to pass an order granting or rejecting the application within 6 months from the date on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itable within the meaning of section 2 sub-section (15). Some of the objects fall within the advancement of any other object of general public utility . Proviso to section 2 sub-section (15) restricts the meaning advancement of any other objects of general public utility . But CIT(A) has not stated that proviso to section 2 sub-section (15) is applicable in the case of the assessee. 10. 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 be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r not can come to the temple and avail of all the facilities available to the public at large 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 u/s. 80G(5) of the Act. 12. Even we noted that all the building maintenance expenses, free food expenses and festival, prayer and daily expenses cannot be regarded to be the one incurred for religious object, even if the object is regarded to be religious one. It is not denied that in the building the assessee was carrying yoga centre, tailoring training centre as well as food for the needy and optical centre for the poor. 13. 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 substantiall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e regarded to be for religious purpose. Under these facts and circumstances, we are of the view that the CIT is not correct in law in not allowing the approval to the assessee trust u/s. 80G of the Act. We accordingly, set aside the order of the CIT and direct the CIT to grant approval to the assessee-trust u/s. 80G(5)(vi) of the Act. We find that hon'ble Rajasthan high court in Umaid Charitable Trust vs. Union of India 218 CTR 30 holds that repair and renovation of Lord Vishnu Temple does not mean that the same is incurred for a particular religion. The hon'ble high court in case of CIT vs. K.H. Kusumgar 63 CTR 70 also holds that study and practice of a particular religion and encouragement/promotion thereof can be registered u/s. 80G of the Act. 7. Now, we come to Revenue's case law. The first one is (2002) 254 ITR 212 (SC) CIT vs. Palghat Shadimahal Trust. We find that objects of the said assessee particularly mentioned Muslim religion. The same is not the factual position in the instant case. The next case law of (2015) 62 taxmann.com 358 (Del) CIT vs. Bhagwan Shree Laxmi Naraian Dham Trust. We find that this trust filed petition seeking exemption u/s. 115BB ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
