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TMI Blog2017 (10) TMI 1514X X X X Extracts X X X X X X X X Extracts X X X X ..... ublic at large and the handicapped persons in particular, to join the conference at the complex, Mandir Shree Mahakali, Sangrur and further a note at the bottom of the advertisement has been given that free tea and food will be served . There are also placed copies of letters from the individuals as well from organizations for booking of rooms and providing of utensils and beddings etc. These evidences on the file prove beyond doubt that the use of community hall and the Mandir complex is not limited to any particular section or limb of the society, rather, the same is open to all and offered for utilization not only to the individuals but also to social, charitable and religious organizations as observed above. Further, a perusal of the objects of the society reveal that none of the objects gives any presumption that any activity of the assessee society is restricted to a particular caste, community or religion. So far as the observation of the CIT(E) that the Society s main focus is on religious ethics is concerned, there is no bar u/s 11 or 12A of the Act for giving registration to a religious trust. Rather for claiming exemption u/s 11, the application of the income is requi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... HREE MAHAKALI, SABHA SANGRUR. 2. The registered office of Sabha shall be at Sangrur in Mahakali Mandir Complex outside Patiala Gate, Sangrur. 3 Aims and objections of the society are - (a) to maintain, manage, improve, furnish, reshape, restructure, reconstruct amend alter or add in the existing Building, facilities and area so that these could be used in better way by Mahakali Devi devotees, worshipers, saints and visitors to the Mahakali Devi Mandir for religious, charitable social purposes. (b) to construct more building in Mahakali Devi complex and develop the entire complex for better use by the devotees, worshipers, saints, and public in general for religious, charitable, educational and socital purposes. (c) to propagate Hindu Religion, teaching of Sanatam Dharam and brotherhood amongst the public in general and Sangrur citizens in particular (d) to arrange and celebrate Hindu festivals, religious occasions, and to propagate and inculcate the religious feelings brother-hood and nationalism amongst the public in general and Hindus in particular. (e) to develop and inculcate sound, moral, religious and national character in younger generation. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ments of trust and Nature of receipts in the account. (x) Books of accounts for financial year 2015-16. (xi) Bank narration sources of the same. (xii) Proof of activities which were otherwise not found on record. (xiii) Explain how, the society prima facie being a religious society, the objects and activities are covered under charitable activities. (xiv) The applicant, was also asked in light of application of funds not being undertaken to the extent of 85%, whether applications been made with the assessing officer in the prescribed format for accumulation of income beyond the specified amount along with proof, if any. (xv) In light of reply dated 17.02.2016 wherein the primary object had been specified as management and maintenance of the temple of Shree Maha Kali Devi Mandir at Sangrur and building up funds to provide monies towards construction of building hall for use of Mahakali Devi Devotees etc., explanation how this primary object gets covered by the limbs of Charitable purpose envisaged in section 2(15) of the Act. 4. In response, the assessee society furnished the reply dated 8.4.2016 and further a supplementary reply dated 26.4.2016 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l. Its activities do not get covered under any of the limbs of charitable purpose as defined in section 2(15) of the Income Tax Act, 1961. Further, on perusal of payments account it is evidently clear that assessee has not spent even miniscule amounts on the so called other charitable activities claimed as the society's objects. (c) The society has provided its memorandum and aims objectives along with balance sheets. In the memorandum of the society attached with the application there was no evidence of any dissolution clause, beneficiary clause or utilization clause being incorporated therein. It has also not been clarified in any clause of the memorandum that in case the society becomes defunct or ceases its operations where the assets and liabilities of the society will go. The provisions of section 13(1) (c) of the I.T Act states that in case of a trust for charitable or religious purposes or a charitable or religious institution, any income thereof - (i) If such trust or institution has been created or established after the commencement of this Act and under the terms of the trust or the rules governing the institution, any part of such income enures, or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the society is held to be restrictive and not enuring to the benefit of the general public. Also the genuineness of activities of the society doesn't stand corroborated vis-a-vis the stated ostensible aims and objects. Accordingly, the application under section 12A for grant of registration is accordingly rejected. 6. Being aggrieved by the above rejection of the Application, the assessee society has filed the present appeal before us. 7. We have heard the rival contentions and have also gone through the record. The Ld. AR for the assessee submitted that the assessee Society is maintaining a complex of Mandir Shree Mahakali Devi, Sangrur. Apart from renovation and repair of Mandir complex, the assessee society has constructed a community hall for use of public in general for organizing religious, charitable and social functions. That the land in question over which the construction is made, though, is owned by the government, but, the property so developed is held under the trust. The Society has been constructing and developing the property for the use and benefit of public in general without claiming ownership rights over the same. The Ld. Counsel has further r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctivity of development of the property as well as the other activities carried out by such organization for the benefit of public at large would disentitle it from registration u/s 12AA of the Act. We do not find any such restrictions in the relevant provisions of Income-tax Act. Rather, we see it otherwise, no motive of profiteering is involved in such types of activities as the assets created are not owned by the society but are passed on to the public at large for common use and benefit. Since as per the provisions of section 11 of the Act, to claim exemption from taxation, the income should be derived from property held under the trust wholly for charitable or religious purposes and to the extent to which such income is applied to such purposes in India .; Admittedly in this case, the society has constructed the building of Mandir complex and community hall etc. The property, though is not owned by the trust, yet, it has been held under the trust, wholly for charitable and religious purpose, the income from which, as per the objects of the society, is to be applied for such purposes only. 10. The second issue discussed by the Ld. CIT(E) is that no reliable evidence with reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mahakali, Sangrur and further a note at the bottom of the advertisement has been given that free tea and food will be served . There are also placed copies of letters from the individuals as well from organizations for booking of rooms and providing of utensils and beddings etc. These evidences on the file prove beyond doubt that the use of community hall and the Mandir complex is not limited to any particular section or limb of the society, rather, the same is open to all and offered for utilization not only to the individuals but also to social, charitable and religious organizations as observed above. Further, a perusal of the objects of the society reveal that none of the objects gives any presumption that any activity of the assessee society is restricted to a particular caste, community or religion. 11. So far as the observation of the Ld. CIT(E) that the Society s main focus is on religious ethics is concerned, there is no bar u/s 11 or 12A of the Act for giving registration to a religious trust. Rather for claiming exemption u/s 11, the application of the income is required to be for charitable or religious purposes. From the discussion made above, it is proved that no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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