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TMI Blog2016 (9) TMI 1064X X X X Extracts X X X X X X X X Extracts X X X X ..... e charitable purpose, any other object which might not be charitable, but which is ancillary or incidental to the dominant purpose, would not prevent trust or institution from being a charitable trust. In the given case, no doubt the trust has mixed objects but what is important, can it be distinguishable. Ld. CIT(E) himself observed that the trust has incurred expenditure towards charitable as well as religion. He even distinguished the income as well as relevant expenditure. Coming to the ascertainability of the object, in our view, we have gone through the objects and found that certain institutions formulate their objects in such a fashion that they try to address in global level, then comes down to their main objects. In the given case also, it appears unascertainable but they try to cover overall general objects, which may not look ascertainable. But in our considered view, CIT(E) should have looked at the whole objects and appreciated the overall aspects are charitable purpose in the creation of the trust. As long as it is beneficial to the society, it should be appreciated. With regard to objects of the religious purpose, wherever the objects or activities which ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uery on the nature of the objects and classification of the same under different heads such as Medical relief, Education Relief of poor etc. Assessee filed reply filed vide letter dt.23.02.2015, wherein it was submitted that object No. 4 falls under Religious, objects nos.5, 8, 12 15 fall under Education. It was stated that object no.16 falls under Medical and object nos.6, 9 14 fall under Relief of the poor. It was submitted that the remaining object nos. 1, 2, 3, 7, 11 13 fall under General Public Utility. CIT(E) observed that the explanation is not satisfactory and hence, not acceptable. The CIT(E) observed that in fact, from those 16 objects as per the MoA, (English translation of which was filed during the course of assessment proceedings), it is noticed that the dominant objects in the case of the assessee are not ascertainable. The first two objects which are important, do not confirm to the requirement of charitable purpose as per the term defined u/s 2(15) of the Act. The same are reproduced as under: 1. To strive for establishing discipline end utility among the members. 2. Striving with all members for creating new India, for welfare of the Nation and f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this case, in CIT(E) s view, is not eligible for registration u/s.12AA. 3. 3 In view of the above observations, the CIT(E) rejected the application filed by the assessee in Form No. 10 seeking registration u/s 12AA of the Act. As such, the other application in Form N0. 10G filed by the assessee for approval u/s.80G(5)(vi) is also rejected. 4. Aggrieved with the above order, the assessee is in appeal before us raising the following grounds of appeal: 1. On the facts and circumstances of the case, the learned Commissioner of Income Tax (Exemptions) Hyderabad grossly erred in rejecting the application for registration u/s 12AA of the Income Tax Act, 1961. 2. The learned Commissioner of Income Tax (Exemptions) Hyderabad, has erred in rejecting the application on the ground that the dominant objects of the society are not ascertainable. 3. The learned Commissioner of Income Tax (Exemptions) Hyderabad grossly erred in rejecting the application of the appellant on the ground that the society is for religious purpose. 4. The learned Commissioner of Income Tax (Exemptions) Hyderabad has erred in rejecting the application on the ground that the main objects are no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the program of plantation of trees and strive for the development of trees. n) To strive for housing, roads, water sources development, electricity, sanitation programmes in the village. o) To strive for the welfare of physically handicapped people by establishing Ashrams for them. p) To strive for ensuring good health to the Cattle by providing Medical facilities in the Villages. Ld. AR submitted that all the above objects fall within the definition of Section 2 (15) of the Income Tax Act. 5.1 The ld. AR stated that the Id. Commissioner of Income Tax (Exemptions) Hyderabad has not commented anything adversely about the Charitable nature of the objects of the society. The Id. Commissioner of Income Tax (Exemptions) Hyderabad simply stated that the dominant objects of the society are not ascertainable on one hand and on the other hand the dominant activity in the case of the assessee society is spreading of Christianity, which is of religious nature. The Assessee never said that the society is fully and wholly charitable. The fact is that the society is having mixed objects i.e., both charitable, religious and objects of general public utility. From the Income and Expen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the provisions of section 12A by itself, will not automatically confer the benefits of section 11 and 12 on a trust, but the trust will get the benefit only on complying with the requirements of sections 11 and 12 of the Act, which compliance can be examined by the assessing authority, while processing the return filed by the trust. 5.5 Ld. AR stated that hence it is not in the purview of the Id. Commissioner of Income Tax (Exemptions) Hyderabad to check and verify the expenses at the time of granting the registration u/s 12AA of the Income Tax Act, 1961, which act falls under the purview of the Assessing Officer. Even for argument sake, if the checking of the expenses and income falls under the purview of the Commissioner of Income Tax (Exemptions) Hyderabad, at the time of granting the registration u/s 12AA of the Income Tax Act, then also the income pointed out by the Commissioner of Income Tax (Exemptions) falls under religious nature which was one of the objects of the society. As far as the expenditure picked up by the Commissioner of Income Tax (Exemptions) is concerned also falls under the Religious nature , which is also one of the objects of the society. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this reason . ........ (Emphasis supplied) 5.7 In addition to the above the ld. AR relied on the following case laws: 1. CIT v Jaipur Charitable Trust 811TR 1 (Del) 2. Zenith Tin Works Charitable Trust V ITO 102 ITR 119 (Bombay) 3. CIT V Ahmedabad Rana Caste Association 88 IATR 354 (Guj) 4. CIT v Chandra Charitable Trust 294 AITR 86 (Guj) 6. On the other hand, ld. DR relied on the order of the CIT(E) as well as relied on the decision of the ITAT Cochin Bench in the case of Tellicherry Minority Welfare Trust Vs. CIT, ITA No. 137/Coch./2009, dated 29/04/2011. 7. Considered the submissions of both the parties and perused the material facts on record as well as the order of CIT(E) and case laws submitted before us. There is no dispute that the assessee has mixed objects thereof charitable as well as religious. But the fact is that the CIT(E) has refused to grant registration because he has analysed only three initial objects of the society and came to the conclusion that the objects are not ascertainable and going further he observed that assessee had received certain donations and met some expenditure, which are purely religious. He observed that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver the objects or activities which are contravening the provisions of section 13(1)(b), the relevant income and expenditure can be eliminated at the stage of assessment, it should not be considered at the stage of granting registration. At this stage, CIT(E) should appreciate the purpose and objects relevant for charitable purpose. Mere presence of certain religious objects should not preclude the officer to doubt the functions of the trust. 10. Ld. DR relied on the case of Tellicherry Minority Welfare Trust (supra). In this case, assessee a charitable and religious trust, applied for registration u/s 12A. In one of the clauses of the trust deed entitled assessee to engage into any other activities which the trust deems beneficial to the minorities and other backward classes. In this case, the Tribunal has found that the benefits were attributable to a particular religious minorities, which contravened the provisions of section 13(1)(b). Hence, denied the registration. Whereas, in the present case, the objects are clearly distinguishable and beneficial to overall communities and not restricted to a particular community. The relevance is that the religious activities can be iden ..... X X X X Extracts X X X X X X X X Extracts X X X X
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