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As both the references relate to Shri Radha Krishna Temple Trust, Kanpur, they are taken up for hearing together and are being decided by a common order.

3. The IT Ref. relates to the asst. yrs. 1973-74, 1976-77 and 1978-79 whereas the WT Ref. relates to the asst. yr. 1973-74.

4. Briefly stated the facts giving rise to the IT Ref. are as follows :

The respondent, Shri Radha Krishna Temple Trust, Kanpur, is a public religious trust and derives income from rent, dividend, interest, etc. It claimed exemption under Section 11 of the IT Act in respect of its income. The ITO did not allow the exemption under Section 11 of the Act on the ground that the trust was hit by the provisions of Sections 13(1)(c) and 13(2)(h) of the IT Act because the trust fund remained invested in concerns in which the trustees were substantially interested. The respondent preferred separate appeals before the AAC. The AAC had held that investment of the value thereof received by the trust by way of donation could not be treated as investment within the meaning of Section 13(2)(h) of the IT Act and, therefore, the trust was eligible for exemption under Section 11 of the IT Act. The Revenue's appeals before the Tribunal have failed.

5. Briefly stated the facts giving rise to the WT Reference are as follows :

The respondent-assessee, which is a trust created with the object of maintaining Sri Radha Krishna Temple, took the factory premises of M/s J.K. Ginning Factory on lease and let the same out on rent to various tenants. It also constructed certain shops and flats of its own and let the same out on rent. The rental income during the assessment year amounted to Rs. 1,11,472. The leasehold right was not settled on the trust by its founders. The activity of the trust of taking premises on lease on normal charges and letting the same out to tenants on higher rent and construction of shops and flats, which were never the object of the trust, was treated to be indulged in the activity of profit by the WTO. The funds of the trust continued to remain invested in M/s J.K. Synthetics Ltd., a concern in which person enumerated in Section 13(3) had substantial interest. The WTO, therefore, held that the trust was hit by Section 13(2)(h) of the IT Act. Taking recourse to the provisions of Section 21A of the WT Act which provided that such property of the trust which had been used for the benefit of any person referred to in Sub-section (3) of Section 13 is liable to wealth-tax, the WTO was of the opinion that provisions of Section 13(1)(c) r/w Section 13(2)(h) of the IT Act and Section 21A of the WT Act were applicable and accordingly refused to allow exemption under the Act. Feeling aggrieved, the respondent preferred appeal before the AAC which came into conclusion that the provisions of Sections 13(1)(c) and 13(2)(h) of the IT Act as also Section 21A of the WT Act are not applicable. The Revenue's appeal before the Tribunal has failed.