9911796707
TMI Blog2015 (4) TMI 714X X X X Extracts X X X X X X X X Extracts X X X X ..... ge, Ludhiana is an educational and research institution serving humanity irrespective of caste and creed and not religious society. That the learned Commissioner of Income-tax-I, Ludhiana has also erred in not considering that the Christian Medical College, Ludhiana society was established since 1949-50 and had been granted registration under section 12A as well as exemption under section 80G since then from time to time. That the learned Commissioner of Income-tax-I, Ludhiana has erred in giving his finding that the society does not fulfil the necessary conditions for continuation of exemption under section 80G(5)(iii) read with Explanation 3 and read with rule 11AA(5) of the Income- tax Rules, 1962. That the various decisions cited by the learned Commissioner of Income-tax-I to give his finding that the society in question is religious in nature and not charitable institution are not applicable in the case of the assessee-society. That the Commissioner of Income-tax-I has failed to appreciate that as per regular returns filed before the Income-tax Department, no part of the funds have been spent ever on the religious activities as alleged by the Commissioner of Income-tax whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... society is running a medical college and hospital. From the above it is clear that many parts in the aims and objects of society are religious in nature. The decision of the hon'ble Supreme Court in the case of Sole Trustee, Loka Shikshana Trust v. CIT [1975] 101 ITR 234 (SC) is entirely applicable to such aims and objects and also the case of Arsha Vijnana Trust v. D. P. Sharma, IRS, DIT (Exemptions) [2007] 295 ITR 437 (AP). 5. In view of the above discussion, it is clear that the society does not fulfil the conditions necessary for continuation of exemption under section 80G(5)(iii) read with Explanation 3 and read with rule 11AA(5) of the Income-tax Rules, 1962." 5. In view of the above, the exemption under section 80G(5) of the Act granted to the assessee-society was withdrawn vide order dated May 25, 2012. The assessee is in appeal against the order of the Commissioner of Income-tax-I, Ludhiana. 6. The learned authorised representative for the assessee referred to the show cause notice issued by the Commissioner of Income-tax placed at pages 28 and 29 of the paper book under which it w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er 22, 2010, which was refused by the Commissioner of Income-tax-I, Ludhiana on the ground that the objects of the assessee-society were religious in nature, which were not eligible for exemption under section 80G(5) of the Act. 9. The aims and objects of the society are as under : "III. The society, is an educational and research institution of an all India character established and run by the minority Christian community. Its primary aim is to educate and train christian men and women as health professionals, in the spirit of Jesus Christ for the healing ministry of the Church in India. (a) The main objectives of the society shall be as follows : 1. To manage, maintain and run the Christian Medical College, Christian Dental College, Christian College of Nursing, Christian College of Physiotherapy, Institute of Allied Health Sciences and similar such other institutions which might be established by the society in future, in Ludhiana, in the true spirit of christian service, ideals and principles in order to equip men and women for service in the promotion of health and the relief of suff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 of memorandum of association observed that the assessee was engaged in training primarily christians in medical, dental, nursing and other health professional students by providing health services to the community and the nation. As per the Commissioner of Income-tax, the assessee-society was being run for providing the health services to particular community of christians only and the main object of the assessee-society was observed to be "welfare of particular religion and community i.e., Christians." The main object of the society was held to be religious under section 80G(5)(iii) read with Explanation 3 below section 80G(5C). The society was held to be not covered under charitable purposes. Rejecting the explanation of the assessee, the Commissioner of Income-tax held the society of not having fulfilled the conditions necessary for continuation of exemption under section 80G(5)(iii) read with Explanation 3 under section 80G(5C) of the Act and rule 11AA(5) of the Income-tax Rules. 11. Section 80G(5) provides as under : "80G(5) This section applies to donations to any institution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the time being approved by the Commissioner in accordance with the rules made in this behalf ; and (vii) where any institution or fund had been approved under clause (vi) for the previous year beginning on the 1st day of April, 2007 and ending on the 31st day of March, 2008, such institution or fund shall, for the purposes of this section and notwithstanding anything contained in the proviso to clause (15) of section 2, be deemed to have been,- (a) established for charitable purposes for the previous year beginning on the 1st day of April, 2008 and ending on the 31st day of March, 2009 ; and (b) approved under the said clause (vi) for the previous year beginning on the 1st day of April, 2008 and ending on the 31st day of March, 2009. 12. Explanation 3 under section 80G(5C) reads as under : 'In this section "charitable purpose" does not include any purpose the whole or substantially the whole of which is of religious nature.'". 13. In the facts of the present case, we find that the assessee was registered as charitable institution under section 12A of the Income-tax Act and the said registration is being continued to be granted to the assessee-society even for the yea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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