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(d) To provide relief in the event of natural calamities such as earthquake, fire flood, riots, civil commotions or otherwise.

(e) To put in joint efforts with other organizations for humanitarian and religious advancement.

(f) To give scholarships, prizes and educational support to the deserving students."

2.1 The AO observed that the objects of the assessee trust inter-alia included to propagate the Islamic faith and to promote religious activities of Islamic faith. According to AO "religious purpose" is not definite in the Act, but it will include advancement, support or propagation of a religion and its tenets and AO observed that there being also charitable objects, the trust is "Religious and Charitable Trust". It is also noticed by the AO that assessee trust was started in Feb.1991. Reference is made by the AO to the following decisions:

3.1 After considering the aforementioned contentions of the assessee and going through the details Ld. CIT(A) has observed that assessee is enjoying registration under section 12A of the Act. Aims and objects of the trust are quite in its spirit and contents and the aims and objects do not reveal that benefits are meant only to a particular religious community. The benefits are available to general public at large. Provisions of section 13(1)(b) are not applicable to the facts of the case as the same can be applied only in the cases of the trust which are solely and exclusively created for benefit of particular religious community or caste. The decisions of Jammu & Kashmir High and Kerala High Court relied upon by Ld. AO suggest that both the trusts were created solely and exclusively for the benefit of a particular religious community or caste and therefore, those cases are different from the case of the assessee trust. The assessee has convened international peace conference in Mumbai which was attended by aforementioned dignitaries. The purpose of convening peace conference was not merely for the purpose of religious community. The object was of general public utility. Ld. CIT(A) has referred to the decisions in which the term "general public utility" has been considered namely: Addl.CIT vs. Ahmedabad Millowners Association ,106 ITR 725 (Guj). He also referred to decision of Bombay High Court in the case of Bar Counsel of Maharashtra vs. CIT, 126 ITR 27 (Bom), wherein it has been held that 'general' means pertaining to whole clas, 'public' means the body of people at large including any class of the public and 'utility' means usefulness. Thus Ld. CIT(A) arrived at a conclusion that advancing any object beneficial to the public or a section of public as distinguished from an individual or group would be a charitable purpose. The object of the trust is, therefore, to provide the benefit to all the communities by giving a clear and loud message of peace as a whole. The aim and object cannot be held as object for particular community or caste and thus not confined to Muslim alone but all community at large. Provisions of section 13(1)(b) are not applicable. The decision of Hon'ble Gujarat High Court in the case of CIT vs. Barkate Saifiyah Society, 213 ITR 492(Guj), is squarely applicable. Denial of exemption under section 11 is not justified. The DIT(Exemption) had granted exemption to the assessee on the basis of trust deed filed by the assessee and also did not point out any violation of any of the provisions of the trust deed. Therefore, Ld. CIT(A) has held that the AO was not justified in denying the exemption to the assessee. He directed the AO to allow exemption to the under section 11. The department is aggrieved, hence in appeal and has raised aforementioned grounds of appeal.

6. On the other hand, referring to the assessment order and the observations of the AO at various places in the assessment order, it was submitted by Ld. AR that AO has held that trust of the assessee is mixed trust. Firstly, he invited our attention to the following observation of AO at page-2 of the assessment order:

"From the aforesaid objects of the Trust and other Objects as mentioned in the Trust Deed which are Charitable in nature it is evident that the assessee trust is 'Religious and Charitable Trust'.

7. We have carefully considered the rival submissions in the light of material placed before us. We have also carefully gone through the assessment order, order passed by Ld. CIT(A), documents referred before us and the case law relied upon by both the parties. In the assessment order AO has not discussed anything about the activities performed by the assessee during the year under consideration. The ITO has only referred to the objects of the trust as stated in clause (a) to (f) and finding that the assessee's object included religious activities the AO has held that assessee is a mixed trust on which provisions of section 13(1)(b) are applicable. A show cause notice was given to the assessee which has been reproduced in the assessment order and assessee was asked to explain as to why it being mixed trust provisions of section 13(1)(b) should not be applied and exemption should not be denied. In response to such notice the assessee placed reliance on the decision of Hon'ble Gujarat High Court in the case of CIT vs. Barkate Saifiyah Society(supra). The AO did not accept such case of the assessee on the ground that the decision of Hon'ble Gujarat High Court is totally different from the case of the assessee. He observed that in the case of Barkate Saifiyah Society(supra) the trust was charitable trust, whereas the assessee is religious trust. It is in these circumstances he has denied the exemption to the assessee and has assessed the entire gross receipts as income of the assessee out of which only establishment expenses and depreciation have been allowed. It is in this manner AO has assessed the assessee at a sum of Rs.8,15,58,620/- against the nil income. For arriving at a conclusion that assessee is not entitled to get exemption under section 11 AO has mainly referred to the decision of Hon'ble Jammu & Kashmir High Court in the case of Ghulam Mohidin Trust Vs. CIT(Supra). In the said case the ITO had rejected the claim of assessee for grant of exemption under section 11 on the ground that assessee trust was not charitable trust and it was hit by the provisions contained in section 13(1)(b). The claim was also rejected on the ground that income was not applied for charitable purposes, but only for construction of building for commercial purposes which was not one of the objects of the trust. In appeal AAC found that the trust is partly charitable and partly religious in nature. Therefore, AAC held that part of the income, which was used for charitable purposes, was exempted under section 11 of the Act. He directed the AO to bifurcate the income of the assessee in the two objects and allow exemption in respect of the part which was applied for charitable purposes. The AAC also held that the income of the trust was properly applied for the purposes of the trust notwithstanding the fact that the assessee had used the same in the construction of building for commercial purposes. The Tribunal after analyzing the clauses 13 & 14 of the trust deed held that the trust was partly charitable and partly religious and as there was no apportionment of income between two objects of the trust and it was left to the exclusive discretion of the trustees to spent what ever they like on any objects, the assessee was not entitled to claim exemption under section 11 of the Act. Their Lordship of the High Court found that clause 13 & 14 of the instrument which contain objects of the trust were clearly showing that the trust was a religions trust created exclusively for the benefit of persons belonging to a particular religious community, which is Muslim community. Even the ex-gratia grants and loans on easy terms for further studies and research are confined to Muslims. It for that reason their Lordship observed that the trust was covered within the ambit of clause (b) of section 13(1) which denies exemption of income to such trusts under section 11 of the Act. Their Lordship further observed that clause (a) of section 13(1) of the Act was also attracted because whole of the income from property held under the trust, which is private religious trust does not enure for the benefit of the public. Thus in these circumstances it was held that Tribunal was right in holding that assessee trust was not entitled to claim exemption under section 11 of the Act for the income derived by it from the property held under the Trust. As mentioned earlier, AO had applied this decision of Hon'ble Jammu & Kashmir High Court to the case of the assessee. According to well settled principle of law in the case of CIT vs. Sun Engineering Work Pvt. Ltd. 198 ITR 297(SC) a judgment of a Court has to be read in the context in which the question arose for decision in that case. It was further held that it is not desirable or permissible to pick out a word or sentence from the judgment of the Court, divorced from the context of the question under consideration and treat it to be the complete "law" declared by the Court. The judgment must be read as a whole and the observations from the judgment have to be considered in the light of the question which were before the Court. The decision of the Court takes its colour from the question involved in the case in which it was rendered and while applying decision to a later case, the Court must carefully try to ascertain the true principle laid down by the decision and not pick out words or sentences from the said judgment divorced from the context of the question considered by the Court in that case to support their reasoning. Considering the facts of the decision in the case of Ghulam Mohidin Trust. Vs. CIT(supra), it cannot be said that the said case is applicable to the case of the assessee as none of the object of the trust has limited the application of entire income to a particular community. From the facts of that case it was observed by the Hon'ble High Court that the trust was in the nature of private religious trust and therefore, it did enure for the benefit of the public. These observations of their Lordship are stated in para 5 of the said judgment. Therefore, to reject the claim of the assessee regarding exemption under section 11 reliance cannot be placed on the decision of Hon'ble Jammu & Kashmir High Court in the case of Ghulam Mohidin Trust vs. CIT(Supra).