TMI Blog1987 (9) TMI 33X X X X Extracts X X X X X X X X Extracts X X X X ..... for other religious and charitable purposes. The sathram is let out for the residence of devotees visiting the temple. In the absence of devotees, it is being let out to the members of the public as well. The rent thus realised is being made use of for the administration of the temple and for other religious and charitable purposes. Since the income derived by letting out the auditorium and sathram are ploughed back for the administration of the temple and for other religious and charitable purposes, the petitioner claimed exemption from tax under section 72 Of the Panchayat Act. This claim was repelled by the Panchayat. The petitioner took up the matter in appeal before the Deputy Director (if Panchayat, Quilon, the second respondent herei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e from its assets. In the light of these statutory provisions, it is argued that the petitioner-society is not one acting with a profit motive. No member of the society will be entitled to get any part of the profits or assets belonging to the society. On account of the stringent provisions contained in the abovementioned Act, it is argued that the Society can function only for a charitable purpose without any profit motive. The income derived by it should be utilised for the charitable purposes for which the society has been registered and not for any other purpose. The income derived by way of rental of the buildings belonging to the society are being ploughed back for carrying out the charitable purposes of the society. In such a situati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... auses with which I am concerned in this petition. For a proper understanding of those clauses, I read the same. " Exemption.-(1) The following buildings and lands shall be exempt from the tax, cess or duty leviable under section 66 ... (b) buildings which are attached to places of public worship and are used for residential or other purposes connected therewith; (c) choultries for the occupation of which no rent is charged and choultries the rent charged for the occupation of which is used exclusively for charitable purpose The auditorium is claimed to be a building attached to the temple. That building can claim exemption from tax liability only if it falls under clause (b) quoted above. It is common ground that the auditorium is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ram is being used for the administration of the temple and for other religious and charitable purposes. On this ground, the petitioner claims exemption for that building from tax liability. According to learned counsel appearing for the Panchayat and the learned Government Pleader, the choultry can claim exemption only if the entire rent is used exclusively for charitable purposes. When the petitioner has stated that the income derived by way of rent is being used for the administration of the temple and other religious and charitable purposes, it is contended that the building cannot be exempted from tax liability. It is submitted that the petitioner has nowhere in the petition stated that the entire income from the sathram is used exclusi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e building should have been eligible for exemption. The maximum exploitation of the public by charging at an exorbitant rate cannot be considered as charity. Therefore, the Panchayat is entitled to the assessment and the Temple Administration Board need not grudge paying a portion of its income as tax which is also to be considered as an act of charity." To say the least, the Government has not approached the question in the correct perspective. From the above portion of the order, it would appear that had the petitioner realised only a nominal rent, the building would have been exempted from tax liability. The quantum of rent realised by the petitioner is not at all relevant for deciding the question as to whether the building is to be e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... carry out a charitable purpose and not to earn profit, the purpose would not lose its charitable character merely because some profit arises from the activity ". The petitioner is engaged in activities of religious and charitable nature. The income derived by the petitioner is ploughed back for the purposes of those activities. The income is being used by the petitioner to augment its assets for enlarging its religious and charitable activities. Such user can only be of a religious and charitable nature. No member of the society earns any profit from the income of the society. The petitioner has averred that among other activities, they are giving free food to 200 poor persons everyday, that they are holding religious discourses every for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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