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The Trust is registered under Section 12A(a) of the Act with CIT at No. DLI(c) (1-1090) vide letter No. 205 dated 22-12-1980. The aims and objects of the Trust are charitable within the meaning of Section 2(15) of the Act. The Trust is recognised under Section 80G by the CIT which was valid up to 30-6-1981 vide his letter No. 207 dated 22-12-1980.

16. For assessment year 1983-84, apart from repeating the above para, the following is further stated :

During the year, the Trust purchased land amounting to Rs. 4,25,406 for which necessary details/copy of the sale deeds having been filed during the course of assessment proceedings. The Trust gave grant for education amounting to Rs. 35,000 for which necessary details have been filed.

In that year, it was claimed that an amount of Rs. 45,815 was applied for purpose of the Trust. But since only Rs. 19,901 was the total income determined to that extent only the claim was allowed. Consequently, exemption under Section 11 was granted to the assessee trust.

17. For assessment year 1984-85, for which the previous year ended by 30-6-1983 in the assessment order framed by the then ITO it is clearly stated that the facts of the case were the same as discussed in the assessment order for assessment year 1983-84. The aims and objects of the Trust are charitable within the meaning of Section 2(15) of the Act. In the year of account relating to that assessment year, the assessee Trust stated to have received Rs. 1,25,000 as donations towards building fund. Confirmation letters were filed and the assessee claimed to have spent an amount of Rs. 20,000 on the construction of the building which is allowed as expenditure incurred by the assessee for charitable and religious purposes. In that year accumulation of Rs. 11,001 was allowed under Section 11(1)(a). Thus it is obvious that the Trust was held entitled to exemption under Section 11(1). Photocopy of the assessment order for 1984-85 was provided at page 178 of the assessee paper book.

Held, affirming the decision of the High Court, that it was not possible to cull out in clear terms any specific charitable or religious object from the trust deed to conclude that the trust was set up wholly for religious or charitable purposes. The "religious, charitable, cultural and social" purposes referred to in the deed were not avowed as the objects of the trust: they were only the objects of those who wished to put the trust property to use. There was no mention in the deed as to how the income derived from the trust property was to be utilised. There was no mandate that the income was to be spent on religious or charitable purposes. Therefore, the trust deed did not meet the requirements of Section 11 (1)(a), and the income of the trust was not exempt from tax.

The Hon'ble Supreme Court from the facts and circumstances involved in that case held that it was not possible to cull out in clear terms any specific charitable or religious object from the trust deed to conclude that the trust was set up wholly for religious or charitable purposes. The "religious, charitable, cultural and social" purposes referred to in the deed were not avowed as the objects of the trust; they were only the objects of those who wished to put the trust properties to use. There was no mention in the deed as to how the income derived from the trust property was to be utilised. There was no mandate that the income was to be spent on religious or charitable purposes and, therefore, the trust deed did not meet the requirements of Section 11(1)(a) and the income of the trust was not exempt from tax. The Madras High Court decision in Gangabai Charities' case (supra) was affirmed.