Document Fragment View

Matching Fragments

14. We find the Hon'ble Rajasthan High Court in the case of Umain Charitable Trust Vs. Union of India reported in 307 ITR 226 has observed as under (Short notes) :
"The line of distinction between religious purposes and charitable purposes is very thin and no watertight compartment between the two activities can be established. Unless the objective of the charitable trust in question itself is to spend its income for a particular religion and it is so found in the trust deed, the Income-tax Department cannot reject the renewal of the trust as charitable trust under section 80G of the Income-tax Act, 1961, merely because one particular expenditure is for an activity which may be termed as spending for a particular religion.
"11. The Hon'ble Supreme Court in CIT Vs. Dawoodi Bohra Jamat, (2014) 364 ITR 31 (SC) had observed that the objects of trust as declared in the Trust Deed would govern its right of exemption under sections 11 and 12 of the Act. The Hon'ble Supreme Court also recognized the creation or establishment of trust for either religious or charitable or both religious and charitable purposes. By looking at the objects of the trust, it had to be determined whether the objects were wholly religious or wholly charitable or both religious and charitable and it was held that on consideration of the objects of the trust, the religious and charitable purposes and activities of the trust could be determined. It was further held that section 11 of the Act allows such trust with composite objects to claim exemption from tax as a religious and charitable trust, subject to provisions of section 13 of the Act. Though the objects of the trust were based on religious tenets but where the activities of the trust for both charitable and religious were not exclusively meant for a particular religious community, then it would not fall under the provisions of section 13(1)(b) of the Act and it was further held that where the assessee was charitable and religious trust, which did not benefit any specific religious community and hence, it could not be held that the provisions of section 13(1)(b) of the Act would be attracted to the assessee trust and therefore, it would be eligible to claim exemption under section 11 of the Act. The relevant observations of the Hon'ble Supreme Court are as under:-
(ii) That the objects of the assessee-trust were not indicative of a wholly religious purpose but were collectively indicative of both charitable and religious purposes. Although objects (c) and (f) which provided for activities completely religious in nature and restricted to the specific community of the assessee-trust were objects with religious purpose only, the fact that the other objects traced their source to the Holy Quran and resolved to abide by the path of godliness shown by Allah would not be sufficient to conclude that the entire purpose and activities of the trust were purely religious in colour. The objects reflected the intent of the trust as observance of the tenets of Islam, but did not restrict the activities of the trust to religious obligations only and for the benefit of the members of the community. The provision of food to the public on religious days of the community, the establishment of Madarsas and organisations for dissemination of religious education and rendering assistance to the needy and poor for religious activities would reflect the essence of charity. The activity of providing for food on certain specific occasions and other religious and auspicious events of the Dawoodi Bohra community did not restrict the benefit to the members of the community. Neither the religious tenets nor the objects as expressed limited the service of food on these occasions to members of the specific community. The establishment of Madarsas or institutions to impart religious education to the masses would qualify as a charitable purpose qualifying under the head of education under the provisions of section 2(15) of the Act. Similarly, assistance by the assessee-trust to the needy and poor for religious activities would not divest the trust of its altruist character. Therefore, the objects of the trust exhibited the dual tenor of religious and charitable purposes and activities. Section 11 of the Act allowed such trust with composite objects to claim exemption from tax as a religious and charitable trust subject to the provisions of section 13. The Activities of the trust under such objects would, therefore, be entitled to exemption accordingly.

12. In view of the above said proposition laid down by the Hon'ble Supreme Court, the objects of the trust are to be looked into and those objects can be either charitable or religious in nature or both charitable or religious in nature. The question which arises for consideration before us is whether the trust whose objects were religious as well as charitable would be entitled for registration under section 12A of the Act. Looking at the objects of the trust, we find that one of the objects of the assessee trust was to provide Ambulance facility to people at large. The object Nos.2, 6 and 7 of the Trust, were admittedly relating to Christian community. However, other object Nos.3, 4, 5 was to provide Ambulance facility to people at large, to establish and administer educational institutions for needy and deserving Christian students in particular and others in general, to establish hostels, libraries, etc. for Christian boys and girls in particular and other deserving & needy boys and girls in general. The objects of the assessee trust thus, reflect the activities to be carried on for the purpose of Jain religion and also for the purpose of public at large. In view thereof, it could not be held that the same are meant for the benefit of only Jain religious community. We reverse the findings of the Commissioner in this regard.