TaxTMI 
TaxTMI 
2026 (6) TMI 811
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....ceedings on e-filing portal along with the supporting documents/evidence, point wise in the sequence by 02.05.2025. 2.1 In response to the notice dated 17.04.2025, the applicant submitted the reply on 22.05.2025. On perusal of the reply submitted by the applicant, it was noticed by the Ld. CIT(E) that the trust was carrying out religious activities and reproduced the relevant portion of the reply as under: 12. The trust is established for religious-cum-charitable purpose. 13. Not Applicable, 14. A chart showing the details of charitable activities done by the assessee along with the expenditure incurred is as below: S. No. Particulars of Charitable Activities Expenditure incurred (in Rx) Detail of Payments 1. Distribution of Religious Books 18,500 Cash 2. Charitable Camp 3,02,300 Cash 15. Copies of bank account statement of the assessee society for the FY 2023-24 and 2024-25 are enclosed herewith as Annexure-7. 16. Yes, the trust is carrying out religious activities. 2.2 Moreover, the Ld. CIT(E) noted that the objects of the society explicitly mention developing/constructing a Mandir Building whi....
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....planation, for this section, a trust cannot be said to be established for charitable purposes if it includes any purpose/object, the whole or substantially the whole of which is of religious nature. It is not necessary that the trust be established only for religious purposes but even if one object of the trust is wholly or substantially of religious nature, then the trust cannot be said to be established for charitable purposes. The same has been upheld by the Hon'ble Apex Court in the case of Upper Ganges Sugar Mills Ltd. v. Commissioner of Income Tax [1997] 93 Taxman 645 (SC). The Hon'ble Supreme Court while clearly covering the above said argument held as under: "The High Court rejected the assessee's argument that trust was not set up wholly or substantially for a religious purpose; one of the purposes, it said, was to establish, maintain and grant aid to public places of worship and prayer halls', which was an entirely religious purpose. 8. Section 80G applies to donations to any institution or fund established in India for a charitable purpose' Charitable purpose, for the purposes of the section, does not include any purpose the whole or sub....
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....3. The appellant craves leave to add, alter, amend or withdraw any ground or grounds of appeal at any time before or during the course of hearing of the appeal." 4. At the time of hearing, the Ld. AR submitted that as per the objects of the Trust (placed at page no. 27-32 of the Paper Book), the Trust was running institutions for the benefit and use of the general public and it was not discriminatory towards any section of the society. The Ld. AR further submitted during the year, it had incurred expenditure of Rs. 18,500/- towards Distribution of Religion books and Rs. 3,02,300/- on charitable camp and was not hit by the provision of section 80G(5B) of the Act. The Ld. AR also relied upon the order of the Ahmedabad Bench of the Tribunal in the case of Jayshree Gopallalji Haveli Charitable Trust-Ujalvav vs. Commissioner of Income Tax (Exemption) [2025]179 taxmann.com 679 (Ahmedabad- Trib.), which had considered the Upper Ganges Sugar Mills Ltd. v. Commissioner of Income Tax (supra) but had remanded the matter to the file for the Ld. CIT(E) to examine with a direction to verify and record a categorical finding as to whether the assessee had incurred expenditure exceeding five per....
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....section 80G(5) of the Act. We find merit in the submissions made by the learned counsel for the assessee that the mere presence of an object having spiritual or cultural undertones does not, by itself, render a trust religious in nature, especially when the predominant purpose and actual activities are charitable. We further observe that section 80G(5B) of of the the Act permits an institution established for charitable purposes to incur expenditure up to five percent of its total income on religious purposes. Thus, the statutory framework itself recognizes that minor or incidental religious expenditure does not vitiate the charitable character of the institution. The determining factor, therefore, is not the mere existence of religiously worded objects in the trust deed but whether the assessee has actually expended more than the permissible five percent of its total income on religious purposes. In this regard, we find guidance from the coordinate bench decisions of the Ahmedabad Tribunal in Shree Smasta Gurjar Kshatriya Kadiya Samaj Navsari v. CIT (Exemptions) [2025] 174 taxmann.com 1117 (Ahmedabad - Trib.) [26-05-2025], wherein it was held that before rejecting an application f....