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10. It needs to be stated that the assessee in its several replies/explanations placed before the Assessing Officer, asserted that the assessee was both a religious as well as charitable trust, and hence it fell within the exception set out in Section 115BBC(2)(b) of the Act. In such context, the assessee relied upon its registration under Section 10(23C)(v) of the Act dated 17 March, 2008 granted by the Chief Commissioner of Income-tax, Mumbai. The assessee also referred to the objects set out in the Trust Deed and pointed out that there were several places of worship within its premises, which evidenced that the assessee was a trust with mixed objects i.e., both charitable and religious. Insofar as the certificate held by the assessee under Section 80G of the Act was concerned, the assessee contended that the term 'charitable purpose' as defined in Explanation 3 below Section 80G, excluded only those entities whose purpose wholly or substantially was 8 October 2024 ITXA598_2024.DOC religious in nature. It was contended by the assessee that the entities having mixed charitable and religious purpose were not excluded. The assessee contended that however its objects and activities were predominantly charitable and it also served religious purposes, which overlapped the charitable purpose. The assessee also contended that the Assessing Officer's interpretation that the registration under Section 80G was available only to institutions existing solely for charitable purpose was misplaced. The assessee, referring to Section 80G(2)(b) of the Act, contended that under such provision any sum paid by the assessee, to be a place of a renowned public worship, such as Temple, Mosque, Gurudwara, Church etc., was notified by the legislature to qualify as donation eligible for deductions under Section 80G of the Act.

12. In the assessment proceedings held on the above backdrop, the Assessing Officer did not agree with the case of the assessee in passing an assessment order. He was of the view that a trust can be registered under Section 80G of the Act only if it is purely charitable in nature and that even after incorporation of sub-section (5B) in the said provision, Section 80G applied only to charitable organisations, although some expenditure incurred on religious activities, was allowed. In the assessment order the Assessing Officer observed that the exclusion as set out in Section 115BBC(2)(b) of the Act, was meant for the trust established for both charitable and religious purposes, which would suggest that at least one of the objects of the trust was wholly or substantially religious in nature. According to Assessing Officer, the bar set out in Explanation 3 to Section 8 October 2024 ITXA598_2024.DOC 80G of the Act would hit, such mixed trusts. The Assessing Officer observed that the contention of the assessee that it was both a charitable and religious trust was not acceptable, as according to him, the objects of the trust revealed that it was wholly or substantially a charitable trust. He concluded that the benefit of exclusion set out in Section 115BBC(2)(b) was not available to the assessee. The Assessing Officer accordingly taxed the anonymous donations, for the said assessment year which were amounting to Rs.147,71,54,875/-. The amounts of such anonymous donation have differed for the subsequent assessment years, namely, A.Y. 2017-18 and A.Y. 2018-19.

16. The Revenue has raised for consideration of the Court the following questions of law:-

8 October 2024 ITXA598_2024.DOC "(a) Whether on the facts and circumstances of the case and in law, the Hon'ble ITAT has erred in holding that the assessee trust as an organization established for both charitable and religious purposes, when the facts of the case and the objects of the trust clearly show that the assessee is a charitable organization and therefore the anonymous donations received by it shall be taxed as per the provisions of section 115BBC of the Income-tax Act?

(17) "Temple" means a place by whatever designation known and used as a place of public religious worship and dedicated to or for the benefit of or used as of right by the Hindu Community or any section thereof as a place of public religious worship.

(emphasis supplied)

24. At the outset, it needs to be observed that the basis, on which the Assessing Officer proceeded to tax the anonymous donations received by the assessee, is by applying the provisions of Section 80G of the Act which pertains to deduction in respect of donations to certain funds, charitable institutions, etc. It is not in dispute that the assessee is registered for the donors to be benefited under Section 80G qua the donations which would be made to the assessee. Section 80G confers a benefit of deduction being allowed in respect of donations inter alia to charitable institutions. Thus, the 8 October 2024 ITXA598_2024.DOC assessee by virtue of its establishment/registration as a public trust, which also provides for charitable objects, has obtained registration under Section 80G of the Act. The object of Section 80G is not only to provide a benefit to tax payers in availing deduction of the charity they would make, by offering donations to charitable institutions, but also to enable the charitable trust/entity to implement/carry out their objects of welfare and well being of the society at large. A charitable institution may achieve several objects which are intended for collective benefit of the society, and it is with such purpose charitable institutions receive donations to advance charitable and philanthropic purposes. This has been legislatively recognized in terms of Section 80G of the Act.