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TMI Blog2022 (12) TMI 338X X X X Extracts X X X X X X X X Extracts X X X X ..... vided head-wise details of various expenditure but all these details have been submitted before him and as annexed before us in the paper book. While exercising the power to reject or accord approval u/s 80G(5) the Commissioner acts as a quasi-judicial authority. Therefore, the conclusion arrived at by him is expected to be supported by valid and cogent reasons. It is also expected that he should apply his mind to the facts of each case and give reasons either to grant or refuse recognition/approval. This requirement is very much imperative on the part of the Commissioner particularly having regard to the statutory provision under which he functions. This proposition has been observed and upheld by the Hon‟ble Andhra Pradesh High Court in the case of Tirumala Tirupati Devasthanam [ 2001 (8) TMI 108 - ANDHRA PRADESH HIGH COURT] If Trust/Institution incurs expenses for religious purposes which is inclusive and is only a small part of the income, and if the substantial work done by the trust is charitable in nature benefitting the public at large then the institution or trust has to be granted exemption u/s 80G of the Act. In the present case of the assessee, the departme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0,000/- from Shri Ganapati Devasthan Trust to be used inter-alia for construction and maintenance of temple of Gajanan Maharaj, but the construction and maintenance of temple is not included in the objects of the assessee trust and therefore, the assessee-trust has not carried out its activities as per its objects. The ld. CIT (Exemption) had observed at page 3 para 4.3 of his order that the administration and maintenance of temple of Gajanan Maharaj is a pure religious activity. That further, the assessee has not given complete head-wise details of the capital expenditure of Rs. 83,65,500/-, Rs. 33,20,214/- and Rs. 57,04,189/- incurred during the financial years 2015- 16, 2016-17 and 2017-18. The ld. CIT (Exemption) held that the assessee failed to substantiate genuineness of charitable activities and therefore, did not fulfil the conditions as required u/s 80G(5) of the Act. 3. At the time of hearing, ld. Counsel for the assessee opening his arguments submitted that as per the decision of Hon‟ble Supreme Court in the case of Surat City Gymkhana (2008) 170 Taxman 612 (SC) and Gemological Institute of India (2019) 105 taxmann.com 180 (SC), once the registration u/s 12A has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with this provision and accordingly as on date the assessee is doing charitable activities as per the objects of the assessee-trust and the very fact that registration u/s 12AA has been granted to the assessee and before granting such registration, the ld. CIT (Exemption) has satisfied himself regarding the genuineness of the objects and charitable nature of the activities performed by the assessee-trust. So therefore, there is no reason for denial of grant of exemption u/s 80G(5)(vi) of the Act. Another argument put forward by the ld. Counsel regarding observations of the ld. CIT (Exemption) that the assessee has not given complete head-wise details of the capital expenditure of Rs. 83,65,000/-, Rs. 33,20,214/- and Rs. 57,04,189/- in the F.Ys. 2015-16, 2016-17 and 2017-18, this statement by the ld. CIT (Exemption) is not correct since the assessee trust has duly filed audited balance-sheets for the said financial years vide letter dated 11-02-2019 which is also annexed in the paper book at page 89. Head-wise details of the expenditure given in the schedules of the respective balance-sheets was very much there before the ld. CIT (Exemption). 4. Per contra, the ld. D.R supported ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... legal position that once registration has been granted to a charitable trust u/s 12AA of the Act, the question whether the assessee-trust is for charitable purpose or not itself does not arise. This is so since the ld. CIT Exemption gets satisfied regarding the charitable objects of the trust and genuineness of the activities conducted for the charitable purposes and only then registration u/s 12A is accorded to a particular institution or trust. Once this is there, the question should not arise again for ascertaining the charitable purpose of the trust. The objection that has been raised by the ld. CIT (Exemption) as per para 4.2 of his order that one of the main objects of the donations received by the assessee-trust from Shri Ganapati Devasthan Trust during F.Y. 2015-16 is to construct Gajanan Maharaj Temple. In this regard, the assessee has also submitted to the ld. CIT (Exemption) the details of proposed accumulation or setting apart of amounts regarding construction of temple, gaushala, old age home, school for poor children and upkeep and maintenance of temple, etc. Thereafter at para 4.3 of his order, the ld. CIT (Exemption) holds that as per the funds received as donation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... substantially different on facts as compared to the present case since therein the trust had mainly used the funds for construction of religious temple and no charitable activity was carried out. However, in the instant case of the assessee, the department has not disputed the charitable activities conducted by the assessee and as per the directions of the Jt. Charity Commissioner, Pune, the construction of the temple, if at all it would be constructed, would involve only part of the total expenditure within the designated amount which has been directed by the Jt. Charity Commissioner Pune being the appropriate authority. The ld. D.R had also referred to the provision of section 80G(5)(ii) along with Explanation 3 and in this regard it is worthwhile to refer to the provisions of section 80G (5B) which is as follows: Notwithstanding anything contained in clause (ii) of sub-section (5) and Explanation 3, an institution or fund which incurs expenditure, during any previous year, which is of a religious nature for an amount not exceeding five per cent of its total income in that previous year shall be deemed to be an institution or fund to which the provisions of this section app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R 849 (AP). In the case of CIT Vs. Christian Medical College (2015) 274 ITR 17, it was observed and held by the Hon‟ble Punjab Haryana High Court that in a case where the assessee has been running and maintaining the Christian Medical college, Christian College of Nursing, where medical care and training the professionals were provided by the assessee-society to everyone irrespective of their caste, creed, race, religion etc. the assessee was held to be entitled for grant of exemption/approval u/s 80G(5) of the Act. So therefore, if Trust/Institution incurs expenses for religious purposes which is inclusive and is only a small part of the income, and if the substantial work done by the trust is charitable in nature benefitting the public at large then the institution or trust has to be granted exemption u/s 80G of the Act. In the present case of the assessee, the department has not been able to make out a case through facts that the assessee is substantially a religious trust. That on examination of the facts and circumstances we set aside the order of the ld. CIT (Exemption) and direct him to grant exemption/approval u/s 80G of the Act to the assessee-trust. Grounds of app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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