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TMI Blog2023 (6) TMI 435X X X X Extracts X X X X X X X X Extracts X X X X ..... r to get exemption u/sec. 80G, the conditions in this provision needs to be complied with also along with the conditions specified in sec. 80G(5B) of the Act separately. In the referred judgment, the details of percentage of expenses incurred for religious purpose vis-a-vis the total income were not appearing in the order of the ld. CIT(E) nor in the order of the Tribunal and, therefore, the matter was remanded back for fresh adjudication, but in the instant case of the assessee before us, in the order of the ld.CIT(E) itself specifically mentioned that for all the three F.Ys.2019-20 to 2021-22, assessee had spent more than 5% for religious purpose from its total income which details where voluntarily submitted by the assessee trust itse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the next para, it is stated that trust provided food packets to sweepers, security guards and needy poor people during these financial years free of cost. The ld.CIT(E) observed that both the statements were contradictory. For F.Y. 2021-22, the assessee claimed to have carried out activities, such as, health seminar, cultural programmes, music concert, Ramjanmotsav, Ramrath yatra etc. Thereafter, ld. CIT(E) culled out the objects of the trust and observed that the primary objective of the assessee-trust was purely religious in nature, therefore, assessee was requested to furnish copies of financial statements for the last three years, but it was not submitted. However, as per the submission of the assessee dated 10/10/2022, it was evide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e substantial in nature, if subtracted, then they would fall within the permissible limit of percentage as per s. 80G(5B) of the Act. Ld.AR also submitted that as per the objects of the trust the assessee is doing not only religious activities, but also other charitable activities, which were conducted by the applicant-trust for the benefit of the society at large. 4. Per contra , ld.DR submitted that there cannot be any segregation of the electrical expenses as it was tried to be demonstrated by the ld.AR of the assessee, since without such expenses on electricity being incurred, no religious functions or activity was possible, and therefore all these expenses are very much intricately woven to constitute, in totality, the religious ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocuments placed before this Bench. 5.1. It is evident from the order of the ld. CIT(E) that assessee had voluntarily submitted the percentage-wise expenses details incurred for religious purposes vis-a-vis its total income from F.Ys. 2019-20 to 2021-22 and therefrom, it is absolutely clear that the percentage of expenses of religious nature incurred by the assessee for each individual year is more than 5%, which is in contravention and violative of sec.80G(5B). It is also observed as demonstrated by the ld.DR that in object clauses, majority of the objects are pertaining to religious activities and even there is a specific clause for spending of surplus, where it is written, if any surplus arises after spending on these religious activit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the ld.AR was that since the applicant trust has already got registration u/s. 12AA, therefore, in automatic and in normal course 80G exemption should also be granted to the assessee. We are again not in conformity with this argument of the ld.AR, since the legislature in its wisdom has brought out these two specific provisions i.e. 12AA 80G for distinct purpose and object. In order to grant registration under 12AA, the ld. CIT(E) must look into the genuineness of the activity and objects of the trust and also look into whether the trust is complying with other laws applicable at the relevant time, so that the trust can fulfill its objects. Once the Commissioner is satisfied in these areas, then registration u/sec. 12AA is granted. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st has clearly violated the provisions of sec. 80G(5B) and the ld. CIT(E) was correct in law and in facts for rejecting the application of the assessee regarding grant of exemption u/s. 80G of the Act. Again, we reinforce this proposition that there is no automatic grant of exemption u/sec. 80G even if the trust is registered u/sec. 12AA of the Act. The Hon'ble Supreme Court in the case of CIT(E) v. Sant Girdhar Anand Parmhans Sant Ashram [2023] 452 ITR 52 (SC) has held that while there is no dispute that the assessee asserts that it continues to hold exemption u/sec.12AA, nevertheless, for the benefit u/s.80G(5B), the requirements of that provisions have to be satisfied separately. In view of the fact that ld. CIT(E)‟s order as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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