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TMI Blog1964 (10) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... owners of the temple in the following shares: Rs. As. Ps. 1. Shantilal Parvatishanker 0 4 0 2. Shushila Jayashanker 0 6 0 3. Jamiatram Vishushanker 0 2 0 4. Sharda Ochhavalal 0 2 0 5. Dhanlaxmi Manalal 0 2 0 The assessees performed the aforesaid functions in regard to the temple and claimed to be entitled to the offerings made to the deity in the aforesaid shares. Of the assessees, three were ladies. For the purpose of sharing the offerings which might be made to the deity, what is known as vara system, i.e., the system by turns, was followed by the assessees. Under this system, each assessee attended the temple as pujari by turns during the particular days allotted to him by casting lots and collected the offerings to the deity during that period and such offerings were retained by him as his own income. The number of days allotted to each assessee in a period of two months depended on the share to which he was entitled. On the days allotted to him, each assessee managed and looked after the temple, attended to the adornment of the deity, performed the puja and did all other things required in connection with the temple and collected the offerings m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this ground from the memorandum of appeal was not wilful or unreasonable, refused to entertain this contention. The explanation given by the assessees for not taking this contention as a ground of appeal in the memorandum of appeal was that the order of the Assistant Charity Commissioner holding that the temple was a public religious trust was dated 14th April, 1959, whereas the appeals were filed prior to that date on 2nd April, 1959, and this contention could not therefore be taken as a ground in the appeals. The Appellate Assistant Commissioner, while not disputing the facts pointed out by the assessees had not accepted the decision of the Assistant Charity Commissioner that the temple was a public religious trust and had, as a matter of fact, preferred an appeal against it before the Charity Commissioner. The Appellate Assistant Commissioner accordingly refused to entertain this contention but, since he decided in favour of the assessees on the question of status, he set aside the assessment. The revenue thereupon carried the matter in appeal to the Tribunal. Before the Tribunal, the assessees sought to sustain the order of the Appellate Assistant Commissioner on the ground d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arose out of the contention of the assessees that the offerings to the deity constituted the income of a public religious trust and were therefore not assessable in the hands of the assessees either as individuals or as an association of persons. But in view of the order made by the Tribunal on the miscellaneous application of the assessees, to which we have just referred, the Tribunal refused to refer the third question to the court for its opinion on the ground that the assessees not having been allowed to raise this contention before the Tribunal and the Tribunal not having dealt with it in its order, no question of law with regard to that contention could be said to arise out of the order of the Tribunal. The assessees, thereupon, made an application to this court under section 66(2) and when the application came up for hearing, we directed that the following question, namely: "Whether the Tribunal erred in law in declining to consider the contention of the applicants that as the income of the Ambaji Temple was the income of a public religious trust, the same was not assessable in the hands of the applicants in their individual capacities at all, either as an associatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ees joined in a common purpose or common action with the object of producing income and income in the shape of offerings to the deity arose to them as a result of the joint enterprise in which they were engaged. To determine this, let us examine the facts of the case. Now, before we consider this question, we must first clear the ground by pointing out that the determination of this question must proceed on the basis that the temple was a private temple of the assessees during the relevant accounting years. Of course, the assessees contended before the Tribunal that the temple was a public religious trust as declared by the Assistant Charity Commissioner by his order dated 14th April, 1959, but this contention was not entertained by the Tribunal on the ground set out above, and the refusal of the Tribunal to entertain the contention forms the subject-matter of the third question. If we decide the third question in favour of the assessees and, on the matter going back, the Tribunal takes the view that the Appellate Assistant Commissioner was wrong in not entertaining the contention or decides, having regard to the facts before it, to entertain the contention despite the refusal of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not responsible for producing the income. The argument, though at first blush attractive, is, in our opinion, fallacious in that it looks at the problem from a wrong angle. It is no doubt true that when people visit the temple and make offerings to the deity they do so because of the religious faith and devotion which they have for the deity and not because they want to remunerate the assessees for the management of the temple or the adornment of the deity or the performance of the pooja or any other activities in connection with the temple. But the question is not what is the motive or reason which prompts people to make offerings to the deity, but what is the object of the assessees in doing these activities. Why do the assessees look after the temple, adorn the deity, perform the pooja and allow people to come to the temple to have darshan and to make offerings to the deity? Obviously the assessees know that if devout and religious-minded people come to the temple, they would almost always as a matter of course make offerings to the deity and this would bring income to the assessees. In order to produce this income the assessees must, therefore, see that people come to the templ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e with a view to earning income, the case would be more akin to that in Commissioner of Income-tax v. Laxmidas Devidas [1937] 5 I.T.R. 584, a decision which was approved by the Supreme Court in Commissioner of Income-tax v. Indira Balkrishna [1960] 39 I.T.R. 546 ; [1960] 3 S.C.R. 513. We are therefore of the view that the assessees constituted an association of persons who were joined together in a common purpose or common action with the object of producing income and income in the shape of offerings to the deity was liable to be assessed in their hands in the status of an association of persons. It was then contended on behalf of the assessees that, in any event, the assessees could not be said to constitute an association of persons in so far as the offerings to the deity on non-festival days were concerned. A distinction was sought to be drawn between the position obtaining on festival days and the position obtaining on non-festival days. The argument was that on non-festival days the management of the temple, including the performance of the functions such as pooja, arti and the adornment of the deity was divided amongst the assessees and each assessee performed these functio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mon purpose, namely, exploitation of the source with the object of earning income. We are, therefore, of the opinion that the position obtaining on non-festival days was not different from that obtaining on festival days and the assessees constituted an association of persons not only in respect of the offerings collected on festival days but also in respect of the offerings collected on non-festival days. In view of this, our answers to questions Nos. (1) and (2) will be in the affirmative. That takes us to the third question which the Tribunal has referred to us pursuant to the order made by us on the application of the assessees under section 66(2). That question must clearly be answered in the affirmative, for it is evident that the Tribunal was in error in declining to consider the contention of the assessees that the offerings made to the deity constituted the income of a public religious trust and not the income of the assessees, on the ground that the assessees had not preferred any appeal from the refusal of the Appellate Assistant Commissioner to entertain this contention. This contention was not raised in the memorandum of appeal before the Appellate Assistant Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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