Shri Baba Balakpuri Ji Charitable Trust Vs ITO Exemption (ITAT Delhi)
Summary: ITAT Delhi allowed the appeal of Shri Baba Balakpuri Ji Charitable Trust and directed the CIT(E) to grant registration under Section 80G, holding that the presence of an object relating to religious activities, including running and maintaining Mandir, Dharmshala, Satsang Bhawan, Gaushala, Bhandara, Kattha and Parvachans, did not make the Trust wholly or substantially religious. The Trust deed expressly provided that its benefits were open to all irrespective of caste, creed, religion, race or gender, while its principal objects included relief of the poor, education, medical relief, yoga, preservation of environment and monuments, and advancement of general public utility. Its financial statements also reflected substantial expenditure on cow feed, electricity, medical expenses, salary, fodder and camps, demonstrating activities beyond maintenance of mandirs.
The Revenue relied on Upper Ganges Sugar Mill Ltd. to contend that even one religious object justified denial of Section 80G approval. The Tribunal distinguished that Supreme Court ruling, finding that clause 5(h) was neither the sole nor overriding object and did not constitute a purpose wholly or substantially wholly religious within Explanation 3 to Section 80G. Following Shreeji Education and Charitable Trust, and noting the principle referred to therein from CIT v. Sri Radha Raman Niwas Trust, the Tribunal further held that Revenue had not established that the activities were discriminatory on religious lines or directed towards any particular community. Accordingly, clause 5(h) could not justify denial of Section 80G approval, and the CIT(E) was directed to grant registration.
Cases Discussed
| Case | Treatment / Principle |
|---|---|
| Upper Ganges Sugar Mill Ltd. (1997) 93 Taxman 645 (SC) | Relied upon by Revenue; distinguished by ITAT. Revenue argued that one religious object was sufficient to deny Section 80G approval. ITAT held that the decision did not apply because clause 5(h) was not the sole or overriding object and was not wholly or substantially wholly religious in nature. |
| Shreeji Education and Charitable Trust, ITA No. 107/RJT/2025, dated 21.07.2025 (ITAT Rajkot) | Relied upon and followed. Where an object is not exclusively or overridingly religious and the trust has other charitable objects such as education, medical relief, yoga, social, cultural and gaushala activities, Explanation 3 to Section 80G does not automatically apply. |
| CIT v. Sri Radha Raman Niwas Trust [2014] 42 taxmann.com 77 (Allahabad High Court) | Relied upon in the precedent followed by ITAT. Sewa puja and Akhand Naam Sankirtan were treated as a form of meditation and yoga and charitable activity; unless activities were proved to be for a particular community or group, they could not by themselves justify rejection of registration under Section 12A and approval under Section 80G. |
FULL TEXT OF THE ITAT DELHI ORDER
The above captioned appeal is preferred by the assessee against the orders dated 12.09.2025, by Ld. CIT(E), Chandigarh, u/s 80G of the Income Tax Act, 1961 [hereinafter referred to as, “Act”] for A.Y. 2023-24.
2. There was none present on behalf of the assessee. We decided to hear the case ex-parte with able assistance of the ld DR. We have carefully perused the materials on record and the paper book submitted by the assessee. The ld DR pointed out that the sole issue in the case is denial of registration u/s 80G. The Ld. DR submitted that the Ld. CIT(E) has considered the objectives of the trust deed and has taken cognizance of one clause 5(h) which falls within the mischief of the provision of explanation 3 to section 80G. The Ld. DR heavily relied on the orders of the Ld. CIT(E) and the decision of the Hon’ble Supreme Court in the case of Upper Ganges Sugar Mill Ltd ((1997) 93 Taxman 645(SC) to say that one of the objects is of religious nature and, therefore, the denial of registration u/s 80G is justified.
3. We have heard the rival submission and perused the materials on record. From the materials on record/PB, we find that the assessee has contended that the main aim and objective of the trust are the relief of the poor education, medical relief, yoga etc and to run and maintain mandir, dharamshala, satsang is also one of the activities and that the activity to run and maintain mandir dharamshala satsang bhavan, gaushala etc do not constitute wholly or substantially wholly an activity of religious nature. The assessee has relied on the decision of ITAT, Rajkot Bench in the case of Shreeji Education and Charitable Trust with ITA No. 107/RJT/2025 dated 21.07.2025.
4. To adjudicate the issue, it would be relevant to reproduce the trust deed where the aim and objective of the trust are described as follows:
BENEFICRY OF THE TRUST:
The Benefits of the Trust are open to all irrespective of Caste, Creed, religion, race, gender etc. That the Trust will not carry on any activities with an intention of earning profit.
5) THAT THE AIMS AND OBJECTS OF THE TRUST ARE AS UNDER:
MAIN OBJECTS:-
a) For Relief of the poor
b) Education
c) Medical relief
d)Yoga
e) Preservation of Environment
f)Preservation of Monuments or Places or objects of artistic or historical interest.
g) The advancement of any other object of general public utility;
h) Religious Activities, to run, maintain Mandir, Dharmshala, Satsang Bhawan, Gaushala, Bhandara, Kattha, Parvachans etc.
i) To collect and receive funds and donations for the above objects.
J) To do all acts, deeds and things as are incidental and conducive to the furtherance of the above objects.
5. First of all, we find that the Trust does not practice any discrimination as it is clearly delineated in the deed that benefits of the Trust is open to all irrespective of Caste, Creed, religion, race, gender etc. Such an object of the trust, to not discriminate between any person for providing their services, is also reflected in the financial statement of the trust. The income and expenditure account for the year commencing on 31.03.2023 shows the major expenses is towards cow feed, electricity expenses, hara chara expenses, medical expenses, alary, toora expenses, camp organize expenses which signifies that the trust is engaged in providing various other services apart from running and maintaining mandirs.
6. Secondly, from the main objects of the trust, we find that the object at clause 5(h) is not the sole objective of the trust. The other more prominent objects are relief of the poor; education; medical relief; yoga; preservation of monuments. We also find that the object at clause 5(h) of religious activity to run mandir, dharamshala, do not override the other objects. We are therefore of the view that Explanation 3 to Section 80G is not applicable in the instant case as the object 5(h) of the assessee, which the Revenue has considered as religious in nature, does not fall into the category of wholly or substantially wholly of religious nature. Therefore, the decision of the Hon’ble Supreme Court of India in the case of Upper Ganges Sugar Mill Ltd (supra) does not apply and is distinguishable from the facts of the instant case.
7. Further, we note that in a similar situation, the ITAT in the case of Shreeji Education and Charitable Trust (supra) has held that where the object is not exclusively for religious purposes, they cannot be considered as covered under the Explanation 3 to Section 80G as held hereunder:
16. We note that after carefully considering the above object, we find that the object 5(D) is not an exclusive or overriding object. Assessee’s trust has other objects towards educational, medical, yoga, social, cultural, gaushala, as well as spiritual. None of the object is religious as well as for benefit of an exclusive religious community or caste. We note that the object 5(D) under consideration begins with a non-obstante clause “WITHOUT DISCRIMINATIONS OF RELIGION OR CAST”. This non-obstante clause provides that it shall uphold its enforceability over later part of the object, even if that is contradictory to it. Hence, the object is not a religious object. Further the purpose YOGA is expressly charitable object as per definition of charitable purpose as per the provisions of section 2(15) of the Act, which says that Charitable purpose” includes relief of the poor, education, Yoga, medical relief, preservation of environment (including watersheds, forests and wildlife) and preservation of monuments or places or objects of artistic or historic interest, and the advancement of any other object of general public utility. Moreover, Publication of spiritual books, literature and running of spiritual and Vaidik centers is also a charitable purpose. It is further submitted that assessee- trust had not constructed any place of worship or conducted exclusively for religious activities, but it is running two schools. Even in the impugned order also, there is no allegation that this object is for benefit of a particular religion.
17. We find that the Explanation 3 to section 80G(5) states that “in this section, “charitable purpose” does not include any purpose the whole or substantially the whole of which is of a religious nature.” This explanation takes note of the fact that an institution or fund shall be for a charitable purpose and may have a number of objects. If any one of these objects is wholly or substantially wholly of a religious nature, the Institution or Funds falls outside the scope of section 80G. The objects as per Explanation 3 must be wholly or substantially whole of which must be of religious nature. Objects and activities of assessee-trust exhibits that none of them is wholly or substantially for the religious purpose. We find that the Hon’ble Allahabad High Court in case of CIT v Sri Radha Raman Niwas Trust [2014] 42 taxmann.com 77 has held that to carry sewa puja of Sri Giridhari Ji and carry Akhand Naam Sankirtan uninterruptedly in Aashram is one type of meditation and yoga and is a charitable activity under section 2(15) of the Act. The High Court held that unless it was proved that the above activities was for any particular community or group of persons, it cannot be a ground to reject the registration u/s 12A and approval u/s 80G of the Act.
8. In the instant case, we similarly find that clause 5(h) does not exhibit the activity of the Trust as wholly or substantially wholly carrying a religious purpose. Running and maintaining Mandir, Dharmshala, Satsang Bhawan, Gaushala, Bhandara, Kattha, Parvachans, have not been established by the Revenue to be discriminatory on religious line or is aimed at a particular community. In view of the above discussion, we therefore, are of the considered view that the clause 5(h) does not make the assessee Trust having a purpose which is in whole or substantially in the whole, of religious purpose. We accordingly, direct the Ld. CIT(E) to grant registration u/s 80G of the Act. The ground is allowed.
9. In the result, the appeal of the assessee in ITA 5833/D/2025 is allowed.
Order pronounced in the open Court on 18.02.2026.
