9911796707
TMI Blog1944 (1) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the waqf the assessee was entitled to exemption from assessment of any portion of the income of the Waqf property under Section 4 (3) (i) of the Income-tax Act? 2. The Respondent has admitted that the above question does arise but has suggested addition of the words all or between the words of and any . 3. Facts of the case.--The facts of the case briefly stated are that the late Mirza Muhammad Ali Namazi executed a Waqf on 17th January 1930 in respect of house properties of the value of ₹ 50,000 situated in Madras. The objects of the Waqf as set out in the Waqfnama have been briefly stated in the order of the Tribunal passed under Section 33 of the Act It was claimed before the Income-tax Officer that the propert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. The settlor fixed the limit by way of percentage up to which the income derived could be spent. Thus 30 per cent. on the object of the benefit of the poor relations of the Waquif, 10 percent. on the object of celebrating Moharrum and other religious festivals of the Shiahs and 20 per cent. on the conduct of marriages and burials of poor Mussalmans had been allotted. The only question that fell to be decided by us under Section 33 was whether the latter amount was exempt under Section 4 (3) (i) of the Act. This section runs thus :-- Any income derived from property held under trust or other legal obligation wholly for religious or charitable purposes, and in the case of property so held in part only for such purposes, the income appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the income of the Waqf property under Section 4 (3) (i) of the Act. The objects of the waqf as stated in the order of the Tribunal under Section 33 of the Act were as follows:-- The principal objects for which the trust was created will be evident from the following quotations from the deed of trust dated the 17th January 1930:-- (i) The benefit of the poor relations of the waquif (settlor); (ii) For celebrating Moharrum and other religious festivals of the Shiahs ; (iii) For the conduct of marriages and burials of poor Mussalmans ; (iv) For the benefit of poor Syeds ; and (v) For such other religious, pious or oharitable purposes as are allowed by Mussalman law as applicable to the Shiahs in conformity with the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Judgment of the Court was delivered by the Hon'ble the Chief Justice). This reference has been made by the Income-tax Tribunal, Calcutta Bench, at the instance of the Commissioner of Income-tax, Madras. The Commissioner contends that the Tribunal failed to appreciate the case put forward by the Income-tax authorities in an appeal by the trustee of the waqf of Mirza Muhammad Ali Namazi in respect of the assessment to income-tax for the year 1940-41. It is evident from a perusal of the order of the Tribunal passed in the appeal that the criticism is well founded. By a deed dated the 17th January 1930 Mirza Muhammad Ali Namazi made a settlement of immovable property for the following purposes:- 1. For the benefit of his poor rela ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es to public charities. In the course of his speech in Bowman v. Secular Society, Ltd.**, Lord Parker of Waddington said:- A trust to be valid must be for the benefit of individuals, which this is certainly not, or must be in that class of gifts for the benefit of the public which the Courts in this country recognise as charitable in the legal as opposed to the popular sense of that term. Moreover, if a trustee is given a discretion to apply trust property for purposes some of which are and some are not charitable, the trust is void for uncertainty . It is common ground that this principle of law applies in India. The case for the Commissioner of Income-tax is that as the first of the objects for which the settlement was made, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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