TaxTMI 
TaxTMI 
2017 (2) TMI 688
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....y are for the benefit of a particular religious community. Aggrieved by this, the assessee has preferred the present appeal before this Tribunal. 3. The ld. Counsel for the assessee has reiterated the submissions as made in the written brief. The submissions of the assessee are reproduced as under :- 1. "For grant of registration u/s 12AA, the Ld. CIT(E), as per sub-section (1) of this section is required to satisfy himself about the objectives of the trust and the genuineness of its activities. Therefore, the Ld. CIT(E) has incorrectly referred to section 12AA(4) inserted w.e.f. 01.10.2014 which provides for cancellation of the registration if it is subsequently noticed that activities of the trust are carried out in the manner that provision of sec.11 and 12 do not apply due to operation of sec. 13(1). The proviso to this section further provides that registration shall not be cancelled if there is a reasonable cause for the activities to be carried out in the said manner. Therefore, it is incorrect on part of Ld. CIT(E) to guide himself by sub-section (4) of section 12AA to refuse registration u/s 12AA(1). 2. It is a settled law that at the stage of grant of registration, ....
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....ion Society V/s. CIT, so long as provisions of Ss. 11, 12 and 12A were complied with, exemption could not be denied merely because there was any violation of provisions of S. 13. Action of D.I.T(E) in refusing to grant registration to assessee trust on ground of violation of provisions of S. 13(1)(b) was not justified especially when he had not doubted either genuineness of activities of assessee trust or nature of its object being charitable. Impugned order was set aside and registration applied for by assessee trust u/s. 12AA must be granted to it Bhai Mansa Singh Ji Welfare Society vs. CIT (2016) 156 ITD 0117 (Chd.) (Trib.) The assessee society made an application for registration u/s 12AA of the Act. As per the Ld. CIT, the amended object 'to run the society for benefit of poor & general public at large to provide medical aid, education institutions, scholarships, sports, blood donation camps, other facilities & activities on the teachings of Bhai Mansa Singh Ji' was against the spirit of sec. 13(1)(b) of the Act. Thus, application for registration was rejected. It was held that the objects were not confined towards any particular sect or biradari. It has been clearly menti....
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....t. The allowability of the deduction under sections 11 and 12 of the Act is to be looked into by the Assessing Officer while completing the assessment in the hands of the assessee at the relevant time. Whether the said deduction under sections 11 and 12 of the Act is allowable or not to the Trust or the Institution by way of non-fulfillment of the conditions laid down in section 13(1)(b) of the Act is to be considered by the Assessing Officer while completing assessment in the hands of the assessee Trust or Institution. But the said violation by the Trust or Institution on account of provisions of section 13(1)(b) of the Act, if any, are not to be considered by the CIT while granting registration under section 12A of the Act. Aggarwal Mitra Mandal Trust vs. DIT (Exemp.) 293 ITR (AT) 259/106 ITD 531 (Del.) (Trib.) In this case, assessee applied for registration u/s 12AA. DIT refused to grant registration on the ground that a number of object clauses are for the benefit of members of Vaish caste only, thereby infringing provisions of sec. 13(1)(b). It was held that the procedure for registration laid down in s. 12AA requires the CIT to satisfy himself about the genuineness of act....
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....im to cancel the registration due to operation of Section 13 (1) in as much as this condition is now embedded in Section 12AA(1) which governs the procedure for registration. 3. Without prejudice to above, it can can be noted that the ITO has raised 4 objections fro granting the registration to the assessee but the Ld. CIT(E) after considering the reply dated 06.09.2016 (PB 24-26) where each of these objection were explained, by referring to the object clause held that it the trust for the benefit of Jain Samaj only by accepting the contention of the assessee on the other objections raised by the ITO. It is submitted that in the object clauses wherever Jain is referred, it is with reference to following the fundamental principals laid down in the Lord Mahaveer which shows the path in which a person should lead his life. Further, all the objects are not for preaching/ spreading the Jain philosophy in as much as object clauses 4, 6 & 11 are objects of general public utility. Section 13(1)(b) is applicable when the trust is created or established for the benefit of any particular religious community only. The object clause nowhere states that the beneficiaries of the trust would be....
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....sessee seeking grant of registration u/s 12A was rejected. CIT held that activities carried on by trust were meant for members of specific community and thus assessee was established for benefit of specific religious community attracting provisions of S. 13(1)(b). Therefore no purpose would be served by granting registration u/s 12A. Held, perusal of objects of trust reflected that though some of objects were for benefit of Christian community in particular, others were strictly not for Christian community in particular, but both for purposes of Christian community and other public at large. Objects of trust must be looked into and those objects could be either charitable or religious in nature or both charitable or religious in nature. Apparently, one of objects of assessee trust was to provide ambulance facility to people at large. Some were admittedly relating to Christian community. However, other objects were 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 othe....
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....r training professionals of any caste, creed, race, religion etc. Medical care was provided by assessee society to all irrespective of their caste, creed or religion etc. Assessee society was established and run by minority Christian community, but as aim and object of assessee society was to train professionals in field of medical and health care and also to provide medical facilities in their hospital to all persons of any caste, creed, race, religion etc. Activities carried out by assessee society were charitable in nature and consequently, assessee was entitled to registration u/s 80G(5) and no merit in order of CIT(A) in this regard and reversing same, it held that renewal of registration u/s section 80G(5) was to be granted to assessee society. Shiv Mandir Devsttan Panch Committee Sansthan vs. CIT (2012) 79 DTR 276 (Nag.)(Trib.) In this case, assessee was duly registered u/s 12A of the IT Act. It filed an application in Form No. 10G seeking approval u/s 80G(5)(vi) of the IT Act. CIT did not approved the same on the ground that one of the object clause of the trust deed i.e. worship of Lord Shiva, Hanumanji, goddess Durga & maintaining of temple, celebrating festivals like....
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.... purpose. Therefore, CIT was not justified in refusing approval to assessee trust u/s 80G(5) & he is directed to grant the same. Umaid Charitable Trust vs. UOI & Ors. 307 ITR 226 (2008) (Raj.)(HC) The line of distinction between religious purposes and charitable purposes is very thin and no water-tight compartment between the two activities can be very well established. Unless objective of the charitable trust in question itself is for spending its income for a particular religion and it is so found in the trust deed, the IT Department cannot reject the renewal of the trust as charitable trust under s. 80G merely because one particular expenditure is for an activity which may be termed as spending for a particular religion. In the present case, it was held that the repair and renovation of Lord Vishnu's temple does not necessarily mean that expenditure in question was for a particular religion only. All people who have faith in Lord Vishnu's temple belong to different sects and have faith in different religions and also visit such temple of Lord Vishnu. The Revenue has not shown that entry in the said temple was restricted to the persons of one particular community....
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..... We have heard rival contentions and perused the material available on record. The ld. CIT has rejected the application by observing as under :- " 6. From the objects of the society, it can be seen that the Society has been created for the benefit of persons belonging to the Jain Samaj only. As the Society is working for the benefit of a particular religious community or caste i.e. Jain Samaj, it violates the provisions of section 13(1)(b) of the IT Act, 1961. Under section 13(1)(b) r.w. explanation 2, a charitable organization will lose the exemption u/s11 if the income is utilized for the benefit of any particular religious community. 7. Similar issue came up before various judicial authorities. The findings are summarized below : Agrawal Sabha - (2014) 45 taxman.com 273 (Allahabad)/(2014) 223 Taxman 353 (Allahabad) - Section 2(15) read with section 12AA of the Income-tax Act, 1961- Charitable/religious purpose (Registration application) - Assessment year 2010-11 - Assessee had filed an application for registration under section 12AA - Dominant object underlying constitution of trust was for benefit of only Agrawal community - No documentary evidence had been produced to s....