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Respected Sir
Body of Individuals has developed 'Bharat Mata Temple' in Gujarat State. Now, such Body of Individuals want to create a Charitable Trust for maintaining of 'Bharat Mata Temple'. Whether this type of activity is covered under charitable activity and entitle to get exemption u/s. 2(15) of the Income tax Act. What would be taken care to create charitable trust in such maintaining of 'Bharat Mata Temple'.
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Bharat Mata Temple - Charitable Trust : An Analysis.
The proposed activity of creating a Charitable Trust for the maintenance and upkeep of the ‘Bharat Mata Temple’ situated in the State of Gujarat falls within the scope of “charitable purpose” as defined under Section 2(15) of the Income Tax Act, 1961. The said provision defines "charitable purpose" to include relief of the poor, education, medical relief, preservation of the environment (including watersheds, forests and wildlife), preservation of monuments or places or objects of artistic or historic interest, and the advancement of any other object of general public utility.
If the nature of the Bharat Mata Temple is such that it represents a symbol of national heritage, patriotic sentiment, and cultural unity rather than a place of religious worship specific to a particular faith, the activity of maintaining such a temple can be construed as either the preservation of a place of historic or cultural interest or as an object of general public utility.
In order to qualify for exemption under Sections 11 and 12 of the Act, it is imperative that the Trust be created with clear charitable objectives as its primary purpose. The Trust Deed should explicitly state that the income and property of the trust shall be applied solely towards the charitable objects, and no part thereof shall be used for the personal benefit of any trustee or other specified person.
Further, the trust must operate on a not-for-profit basis and must cater to the public at large and not to any restricted group or community. If the trust intends to engage in any business activity, the same must be incidental to the attainment of the main charitable objects and separate books of account must be maintained in terms of Section 11(4A).
For availing the exemption, the Trust must obtain registration under Section 12AB of the Income Tax Act by filing the necessary application in Form 10A before the jurisdictional Principal Commissioner or Commissioner of Income Tax (Exemptions). Further, to enable donors to claim deduction under Section 80G, separate approval must be sought under that section. Care should also be taken to register the trust with the jurisdictional Charity Commissioner under the Bombay Public Trusts Act, 1950 (as applicable in Gujarat), and to comply with the statutory requirements relating to the maintenance of books of account, audit, and filing of returns.
It must be noted that any religious activity per se does not disentitle the trust from exemption under the Act, provided the dominant object remains charitable and the benefit of the activities extends to the general public without discrimination. However, if the trust is deemed to be wholly for religious purposes, it will be eligible for exemption under Section 11, but not under Section 80G, in accordance with the restrictions laid down therein.
Hence, the objectives of the trust and the character of the Bharat Mata Temple must be clearly articulated to ensure that the trust is treated as charitable in nature and not purely religious, so as to remain within the protective ambit of the Income Tax exemptions.
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