1998 (10) TMI 32

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..... liability ?". The assessment years are 1972-73 to 1978-79. The assessee is a limited company, the managing director of which happens to be a Muslim by religion. In the course of income-tax assessment proceedings, it is found that the assessee company had paid contribution by way of charitable donations year after year during the month of Ramzan. The amount paid by way of charity varies from Rs. 25,766 to a high of Rs. 53,552 during the years 1972-73 to 1978-79. The amount of the gift to any single individual was less than Rs. 100 at any time. The Gift-tax Officer treated these amounts as gifts made for religious purposes. The Commissioner, to whom the matter was taken in appeal by the assessee, held that the gifts were not for religious p .....

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..... ng within clause (v)--- (a) made at any time before the 1st day of April, 1958, or (b) made at any time after that date subject, in respect of each such gift, to a maximum of rupees one hundred in value and, in respect of such gifts in any one previous year to the same donee, to a maximum of rupees five hundred in value in the aggregate." Section 5 of the Act provides for exemption in respect of the gifts which are covered by any one or the other of the sub-clauses of section 5(1) of the Act. Clause (v) to section 5(1) of the Act exempts gifts made to any institution or fund established or deemed to be established for I charitable purpose to which the provisions of section 80G of the Income-tax Act apply. Clause (vi) of that section e .....

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..... f the gift is religious in nature. The assessee herein is a company and when it makes a gift as charity, it cannot be attributed with any intent. The fact that the company has chosen to give gifts to individuals by way of charity, during a period considered holy does not, on that score alone, render such gifts as gifts for a religious purpose. There is no material whatsoever, on record to show that the recipients of the amounts were persons who were part of a religious order or that they were required to apply the amount for performing religious rituals. The object of the gift was not to promote any religion, but, to reduce the hardship of the recipient, to a limited extent. The fact that the assessee had made gifts in the month of "Ramza .....

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