AI Drafter 
TaxTMI 
TaxTMI 
2026 (5) TMI 1774
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....lam in Arabic and governed by the SUNNI-HANAFI sect of school of thought. The assessee trust is also decided to set-up an Arabic Madarasa for imparting Arabic courses after generating funds and creating regular infrastructure such as building. Therefore the assessee trust had filed an application for granting registration u/s. 12AB of the Act and also filed an application for approval u/s. 80G of the Act. Along with the said applications, the assessee had also enclosed the various documents including the financial statements. Before the Ld.CIT(E), the assessee had also appeared on 11/09/2025 and explained the various activities of education and other allied objects. The Ld.CIT(E) without considering the said submissions and documents, had arrived a conclusion that the assessee trust is a religious trust and therefore it is not eligible for approval u/s. 80G of the Act. 3. As against the said proceedings, the assessee is filing these appeals before this Tribunal. 4. At the time of hearing, the Ld.AR filed a written submissions and also furnished the various documents in support of their case. The Ld.AR submitted that the interpretation given by the Ld.CIT(A) is not in accordan....
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.... 7. The Ld.AR further submitted that the trust was established with the objective of serving the general public and not for a closed group and therefore the benefit of education wherein Arabic, Islamic are all educational activities open to all sections of society without any discrimination and therefore the trust is for the public. The Ld.AR submitted that the Ld.CIT(A) had erred in concluding that imparting Islamic religious education is inherently a religious purpose without considering the well established judicial distinction between academic teaching of religious texts which is an education and religious worship, rituals or propagation which is a religious activity. The Ld.AR therefore submitted that the assessee trust is engaged in the educational activity and not in the religious activity. The Ld.AR also submitted that the department has no evidence of religious ceremonies, worship tracks or propagation activities done by the assessee trust and therefore the order of the Ld.CIT(E) is on erroneous assumptions liable to be set aside. The Ld.AR further brought to our notice that the objects are for establishing educational institutions and promote learning among the general p....
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....oval u/s. 80G of the Act and therefore submitted that the orders of the Ld.CIT(E) are in order and prayed to confirm the same. 11. We have heard the arguments of both sides and perused the materials available on record. 12. On going through the rejection order passed u/s. 12AB of the Act, the Ld.CIT(E) had simply classified the assessee trust as a religious trust without calling for any objections for treating the said trust as religious trust. Only in the order rejecting the approval sought for u/s. 80G, the Ld.CIT(E) had given the reasons for treating the trust as religious trust and on that score, finally rejected the application for grant of approval u/s. 80G of the Act. In the order rejecting the approval, the Ld.CIT(E) had observed that based on the verification of the submissions, it was observed that the nature of the trust was religious cum charitable. The Ld.CIT(E) further observed that the building for using it as an educational institution is proposed to be constructed in the land belongs to masjid. Further, the Ld.CIT(E) also relied on the objects of the trust and observed that the trust is predominantly religious in nature. The another finding of the Ld.CIT(E) i....
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.... dominant objective is to impart education, establish institutions, providing scholarships, developing knowledge, operating libraries and offering language, professional and technical courses. The above said activities are not for a particular religious community but to all the public in general. We have also gone through the judgment of the Hon'ble Supreme Court reported in 364 ITR 31 cited supra in which the Hon'ble Supreme Court had held that the trust is charitable in nature if its primary or dominant purpose is charitable, even though some objects incidentally refer to religious elements. We have also considered the another judgment cited by the assessee reported in 101 ITR 234 cited supra in which the Hon'ble Supreme Court had held that, systematic instruction in any branch of knowledge constitutes education. In the present case, the systematic instruction in the Arabic language and Islamic studies would fall under the category education and not a religious one. In another order of the ITAT Lucknow Bench reported in (2012) 138 ITD 519 wherein it was held as follows * Teaching Islamic studies and Arabic is educational * The trust is not a religious trust ....