TaxTMI 
TaxTMI 
2015 (5) TMI 1013
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.... Das Damodardas Lohia Charitable Trust, Hyderabad (2) Kaushalya Bai Srinivas Lakhotiya Charitable Trust, Hyderabad (3) Kanta Bai Govind Kumar Lohia Charitable Trust, Hyderabad, (4) Ayodhya Bai Damodardas Lohia Charitable Trust, Hyderabad against the identical order of the Director of Income-tax (Exemptions), Hyderabad dated February 26, 2014, in denying the registration under section 12AA of the Income-tax Act, 1961. Since common issue is involved in these appeals, the appeals are heard together and are being disposed of by the single consolidated order. 2. Briefly stated, the assessee-trusts had filed an application in Form 10A seeking registration under section 12AA of the Income-tax Act, 1961. The authorised representative of the assess....
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....sions contained in section 11(1)(a) of the Act, where, reference is made specifically to words wholly for "charitable purposes" or "religious purposes", under that circumstance, having regard to the provisions of section 12A(1)(aa) of the Act read with section 11(1)(a) of the Act, the assessee-trust, in this case, would not be eligible for registration under section 12AA of the Act. Furthermore, under the prevailing facts, i.e., in the face of such mixed objectives, having regard to the ratio of the decision of the hon'ble Supreme Court in State of Kerala v. M. P. Shanti Verma Jain [1998] 231 ITR 787 (SC) and CIT v. Palghat Shadi Mahal Trust [2002] 254 ITR 212 (SC) and Upper Ganges Sugar Mills Ltd. v. CIT [1997] 227 ITR 578 (SC) and of ....
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....ed. The pertinent observations of the hon'ble High Court in this regard, at page 324 of the said decision, are reproduced as under : '8. In our considered view, since section 11 of the Act provides for exemptions to the trust registered under the Act, it is primarily the purpose of section 11 that will dominate or prevail over other consideration. Section 11 provides for this exemption only if the property held is for charitable or re1igious purposes. It is only when such a purpose is shown that registration can be granted.' 2.2. From the above, thus, it follows that only when the income derived from property held under a trust, is meant for application wholly for charitable purposes or wholly for religious purposes, that reg....
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....ng grounds. For the sake of reference we reproduce the grounds raised in I. T. A. No. 851/Hyd/2014 in the case of Raghunath Das Damodardas Lohia Charitable Trust. "1. The order of the learned Director of Income-tax (Exemptions) is erroneous both on facts and in law. 2. The learned Director of Income-tax (Exemptions) erred in holding that the activities of the appellant include both charitable and religious. The Director of Income-tax (Exemptions) ought to have considered the fact that the activities of the appellant are only charitable and do not include religious activities. 3. In the alternate and without prejudice to the above contention, the Director of Income-tax (Exemptions) erred in holding that the appellant is not eligible for r....
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....e of the fact that an institution or fund shall be for a charitable purpose and may have a number of objects. If anyone of these objects is wholly or substantially wholly of a religious nature, the institution or funds falls outside the scope of section 80G and the donation to it will not make the donor entitled for the deduction under section 80G. The objects as per Explanation 3 must be wholly or substantially whole of which must be of religious nature. The assessee has submitted all the evidence including the objects and how the expenditure has been incurred by it. The onus, in our opinion, gets shifted on the Revenue to prove that the assessee-trust is wholly or substantially for the religious purpose. There is no allegation on the part....
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....ave common rights and privileges. This may apply to Christi anity or moslem but not to Hinduism. Therefore, it cannot be said that Hindu is a separate community or a separate religion. Technically Hindu is neither a religion nor a community. Therefore, expenses incurred for worshipping of Lord Shiva, Hanuman, Goddess Durga and for maintenance of temple cannot be regarded to be for religious purpose. Under these facts and circumstances, we are of the view that the Commissioner of Income-tax is not correct in law in not allowing the approval to the assessee-trust under section 80G of the Act. We accordingly, set aside the order of the Commissioner of Income-tax and direct the Commissioner of Income-tax to grant approval to the assessee-trust ....