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TMI Blog1965 (2) TMI 107X X X X Extracts X X X X X X X X Extracts X X X X ..... t ₹ 5 lakhs in trust. The income of this property was to be utilised in the manner indicated in the said deed. The deed mentions that there are several public temples in the State of Bombay and Hyderabad for the upkeep and maintenance of which the assessee had been for several years contributing. The assessee was desirous of making and declaring a religious and charitable trust in respect of the said lands and giving the trustees certain directions. Clause (3) of the trust deed shows that the income was, inter alia, to be utilised: (1) for the upkeep and maintenance of the public temples mentioned in the schedule including the expenses of the repair and the maintenance of the temple buildings; (2) for the expenses of the repair and replacement of any ornaments and utensils and other articles required for the said temples; (3) for the expenses in respect of the maintenance of the Nagarkhana attached to the temples; (4) for the payment of rates and taxes and other outgoings in respect of the temples and the temple buildings; (5) for the expenses in respect of the performance of pujas and other ceremonies; and (6) for the expenses of the performance of temple f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and interest in this portion is transferred to the trustees by this deed of settlement subject to a condition that the trustees are to allow to Her Highness the Junior Dowager Maharanisaheb of Kolhapur to occupy the same for her lifetime as residential quarters for Her Highness the Junior Dowager Maharanisaheb of Kolhapur; and after her death this portion in her possession will be taken in possession by the trustees. (6) Though the possession of the portion of the property in possession of Her Highness the Junior Dowager Maharanisaheb of Kolhapur is postponed for a future period contingent on the death of Her Highness the Junior Dowager Maharanisaheb of Kolhapur, still the trustees are responsible to maintain and keep the same in good order and condition by making suitable repairs and spending for the upkeep and maintenance of the said portion of the property settled on the trust. The assessee had also executed a fourth trust deed setting apart certain properties in trust for a trust named Chhatrapati Charitable Aid to the deserving trust . Under this trust deed the assessee had further settled properties valued at ₹ 45,500. The gift made under this fourth trust dee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1)(vi)(a) are only those gifts which are made for charitable purposes. The gifts not being for charitable purposes, the assessee was not entitled to exemption. In this view of the matter, he brought to tax both the gifts of ₹ 2 lakhs and ₹ 1,38,000 made under the aforesaid two settlement deeds. The Appellate Assistant Commissioner also took the view that the objects of the trust were religious and the gifts were for religious purposes. Examining the provisions in certain other enactments he came to the conclusion that the omission of the word religious in section 5(1)(vi) was not accidental but was with a definite purpose of excluding gifts made for religious purposes from the exemption provided in section 5(1)(vi)(a) and, therefore, the assessee was not entitled to claim any exemption in respect of these two gifts. The Appellate Assistant Commissioner, however, granted a very small relief to the assessee in respect of the gift pertaining to the maintenance of the Nagarkhana provided in the trust deed of date October 1, 1957. The Appellate Assistant Commissioner held that the maintenance of Nagarkhana was a charitable purpose and that part of the gift, which related ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... term of a very wide import and scope covering both public, charitable as well as religious trusts. It is also not in dispute, save and except to the extent of the gift relating to the repairs of the portion of the place occupied by the Junior Dowager Maharanisaheb, that the trusts are for religious purposes. On this undisputed position, it is apparent that the said two gifts would be for a charitable purpose and would ordinarily fall within charitable purpose as understood in Indian law. Mr. Joshi, however, contends that the expression charitable purpose occurring in section 5(1)(vi) must be given a restricted meaning. That expression does not include gifts made for religious purposes. The contention is founded on certain provisions in the Income-tax Act, Wealth-tax Act and the Expenditure-tax Act. Mr. Joshi, referring to section 4(3) of the Income-tax Act, section 5(1) of the Wealth-tax Act and section 5(m) of the Expenditure-tax Act, argued that these Acts and the Gift-tax Act are allied Acts enacted with a certain objective. They are all Acts of the Central Legislature. Whenever the legislature has desired to grant exemptions to a taxpayer in respect of his contributions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nly. As stated earlier, the expression charitable purpose is wide enough to include public religious purposes also. Further there is positive indication in the Gift-tax Act itself that the expression charitable purpose has been used in a wider sense covering religious purposes and not in a restricted sense as is contended for by Mr. Joshi. Clauses (v) and (vi) (clauses with which we are concerned) are connected clauses. Clause (v) speaks of certain gifts to institutions or funds established for a charitable purpose to which the provisions of section 15B of the Indian Income-tax Act apply. Sub-clause (a) of clause (vi) speaks of exemption granted to gifts made for charitable purpose not falling within clause (v). It would be noticed that exemption in respect of gifts made for charitable purpose falling under clause (v) is not restricted to any period. The exemption is available all the time. Exemption under sub-clause (a) of clause (vi), i.e., relating to gifts made to charitable purpose not falling under clause (v), is available only when the gift has been made before the 1st day of April, 1958. Both clauses speak of gifts to charitable purpose. When clause (v) is read along ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es not enure for the benefit of the public. The definition is an inclusive definition and is not an exhaustive definition, and the concluding part of the definition itself shows that religious purposes enuring for the benefit of the public is included in the expression charitable purposes . It would be seen on reading the definition clause and clause (i) of sub-section (3) of section 4 that the expression charitable purposes and the expression religious and charitable purposes are inter-changeable and used for conveying the same meaning. This is the earliest taxation Act enacted in the year 1922. The Wealth-tax Act and the Expenditure-tax Act have been enacted in the year 1957. The Gift-tax Act with which we are concerned here, however, was enacted later in the year 1958. It would be reasonable to assume that the legislature in omitting the words religious purposes must have only intended to omit the unnecessary words which occurred in the earlier Acts and as already pointed out there is an indication in the Gift-tax Act itself, and when clause (v) is read there is no doubt that the expression charitable purpose has been used in the Act in a wider sense and not in a re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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