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2016 (2) TMI 569 - ITAT RAJKOT

2016 (2) TMI 569 - ITAT RAJKOT - [2016] 46 ITR (Trib) 283 - Registration petition u/s. 80G(5) denied - Section 12AA registration - whether the assessee can be held to be a religious trust not entitled for 80G registration or not. We have already summarized arguments of both the parties? - Held that:- We take into account the assessee's objects and activities performed, draw strength from co-ordinate bench decision hereinabove and hold that the same are not expressed to be for benefit of a partic .....

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class, and distributed books. The paper books comprise of photographs and letters which have gone un-rebutted in the course 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 .....

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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 section 12AA registration since 21-08-2014. Its objects inter alia provide as under:- "The object of trust is to carry out activities without having any caste no bar are as follows:- (1) Trust is t .....

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to help poor students in any manner. (2) Trust will start hostel, girl's school, religious temple, etc. Trust will also provide financial assistant to other similar organizations. (3) The students who are taking education in Gujarat state will be provided with scholarships or financial assistant. (4) The above said activities shall not be made for the purpose of earning profit." 3. The assessee applied for section 80G registration before the CIT(E) on 09-10-2014. It was required to fil .....

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ved. 4. We have heard rival contentions. The assessee strongly argues that its objects or activities are nowhere meant for the benefit of any particular religious community or caste. It invites our attentions to various activities performed. The same are claimed to be purely charitable in nature. Various case decisions are quoted in support. It accordingly prays for acceptance of its appeal. The Revenue on the other hand takes us to assessee's registration certificate holding it as a religio .....

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he 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 pre .....

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alleges such a fact either in the course of hearing or in the order under challenge. We accordingly direct the CIT(E) to grant the assessee section 80G(5) registration qua the relevant previous year ending on 31-03-2015 as per law. 6. Now, we come to the main issue as to whether the assessee can be held to be a religious trust not entitled for 80G registration or not. We have already summarized arguments of both the parties. We deem it appropriate to come to relevant provision i.e. 80G(5) up to .....

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re but also it must be expressed to be for the benefit of a particular religious community or caste. We come to assessee's objects and find that there is no such religious community or caste expressed therein. Therefore, this clause (iii) to section 80G(5) is not expressly applicable in the instant case. The Revenue at this stage draws our attention to assessee's objects mentioning satsang, temples etc. We find that a co-ordinate bench of the tribunal in Shiv Mandir, Dev Sthan, Panch Com .....

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section (2), on if it is established in India for a charitable purpose and if it fulfils the following conditions, namely - (i). where the institution or fund derives any income, such income would not be liable to inclusion in its total income under the provisions of section 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 .....

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hat 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) the institution or fund is not expressed to be for the be .....

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titution 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 31 st 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 .....

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ecifically mentioned is allowed if it is approved by the Commissioner of Income-tax in accordance with section 80G(5)(vi). The approval has to be made in accordance with the Rules made in this behalf. Rule 11A under the Income-tax Rules has been inserted w.e.f. 21.09.1992. This rule requires an institution or fund to make an application for approval under section 80G(5)(vi) in form No. 10G. The application was to be submitted in triplicate. This Rule further requires that the application shall b .....

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tion 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) .....

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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 religious object 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 do .....

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, as stipulated u/s. 80G(5) of the Act. 8. We have gone through the relevant clauses which have been regarded to be religious in nature by the CIT(A). The object clause of the trust reads as under: "Worship of Lord Shiva, Hanumanji, Goddess Durga and maintaining of temple. To celebrate festivals like Shivratri, Hanuman Jayanti, Ganesh Utasav, Makar Sankranti, renovation and maintenance of temple. To make available temple for general public and to provide facilities for the public visiting t .....

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can be said to have been incurred for the benefit of particular religion. 9. The charitable purpose has been defined u/s. 2(15) of the Act. The definition of charitable purpose is inclusive one. It includes relief of the poor, education, medical relief, and the advancement of any other object of general public utility. The objects as enumerated above held on by the assessee trust are charitable within the meaning of section 2 sub-section (15). Some of the objects fall within the "advanceme .....

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nstitution 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 .....

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ted out by CIT, nowhere talks of advancement, support or propagation of a particular religion,, worshipping of Lord Shiva, Hanumanji, Goddess Durga and maintaining of temple, in our opinion, cannot be regarded for the advancement support or propagation of a particular religion. No evidence or material was placed on record or brought before us by the learned DR which may prove that these object relate to a particular religion. No doubt the DR argued that it relate to Hindu Religion but in our opi .....

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believe in God or in any intelligent first cause. A religion undoubtedly has its basis in a system of beliefs or doctrines which are regarded by those who profess that religion as conducive to their spiritual well being, but it will not be correct to say that religions is nothing else but a doctrine or belief. A religion may not only lay down a code of ethical rules for its followers to accept, but it might prescribed rituals and observances, ceremonies and modes of worship which are regarded a .....

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not and want to maintain or 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 .....

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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 u/s. 80G. The objects as per Explanation 3 must be wholly or substantially whole of which must .....

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f a civilized society. It as such is not a religion. In this regard we rely on the case of T.T. Kuppuswamy Chettiar v. State of Tamil Nadu [1987] 100 LW 1031 in which it was held "The word "Hindu" has not been defined in any of the texts nor in judgment made law. The word was given by British administrators to inhabitants of India, who were not Christians, Muslims, Parsis or Jews. The alleged Hindu religion consists of four castes Brahmins, Kshatriyas, Vaishyas and Sudras belongin .....

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ism holds within its fold men of divergent views and traditions who have very little in common except a vague faith in what may be called the fundamentals of the Hinduism. The word community' means a society of people living in the same place, under the same laws and regulations and who have common rights and privileges. This may apply to Christianity or moslem but not to Hinduism. Therefore, it cannot be said that Hindu is a separate community or a separate religion. Technically Hindu is ne .....

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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 IT .....

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