Medical and educational activities may support charitable registration despite a religiously associated object clause absent proof of substantially religious purposes.

Charitable registration and tax-exemption approval should be assessed by an institution's actual activities and operative purpose, rather than by selectively reading a single object clause. Where medical, educational, research, and welfare services are provided to the public without restriction based on religion, caste, creed, race, or language, the institution may qualify as religious-cum-charitable rather than solely religious. A clause referring to churchyards, burial grounds, or related works does not by itself establish that the institution's whole or substantially whole purpose is religious. In the absence of factual evidence of religious activities, denial of registration or Section 80G approval on that basis is not supported.

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Issues: (i) Whether the assessee's registration under Section 12AB was liable to be treated as that of a religious entity or as a religious cum charitable entity; (ii) Whether approval under Section 80G(5) could be denied on the basis of one object clause alleging religious character despite the assessee's actual activities being educational and medical in nature and available to the public at large.

Issue (i): Whether the assessee's registration under Section 12AB was liable to be treated as that of a religious entity or as a religious cum charitable entity.

Analysis: The registration order itself described the nature of activities as religious cum charitable, but the annexure classified the assessee as a religious entity. The financial statements, objects, and activity records showed income from hospital, medical college, and allied welfare operations, with expenditure directed toward healthcare, education, research, staff, and related institutional functions. The material on record showed that services were rendered without restriction to any religion or community and that financial concessions were extended on economic considerations. No factual material established that the assessee was carrying on religious activities as its operative activity base.

Conclusion: The assessee was entitled to registration as a religious cum charitable entity and not merely as a religious entity; this issue was decided in favour of the assessee.

Issue (ii): Whether approval under Section 80G(5) could be denied on the basis of one object clause alleging religious character despite the assessee's actual activities being educational and medical in nature and available to the public at large.

Analysis: The denial of approval rested only on an object clause referring to church yards, burial grounds, and related works, and on Section 80G(5)(iii) with Explanation 3. No factual finding was recorded that the assessee had actually carried out religious activities during the relevant period. The accounts and activity profile instead reflected medical, educational, and research functions for the general public. Earlier adjudication on the same assessee, based on substantially identical objects and activities, had recognized that medical care, education, and concessional treatment were available irrespective of caste, creed, race, language, or religion, and that the institution was charitable in substance. There being no change in facts, the same view was applicable.

Conclusion: Approval under Section 80G(5) could not be denied merely on selective reliance upon a general object clause when the assessee's actual activities were charitable and not shown to be religious in substance; this issue was decided in favour of the assessee.

Final Conclusion: The assessee's institutional character was found to be charitable in operation notwithstanding its Christian background, and its public-facing medical and educational activities did not attract disqualification applicable to institutions established for the benefit of a particular religious community or for substantially religious purposes. The registration category was required to be corrected accordingly and the approval claim was required to be granted.

Ratio Decidendi: Where the actual activities of an institution are educational, medical, and welfare-oriented for the benefit of the public without religious discrimination, approval and registration cannot be denied merely by selectively reading one object clause suggestive of religious association in the absence of factual proof that the whole or substantially the whole of its purpose is religious.

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