Bhaktidham Seva Trust Vs CIT (Exemption) (ITAT Ahmedabad)
80G Approval Cannot Be Denied Merely for Incidental Religious Objects: ITAT Ahmedabad Restores Matter to CIT(E)
The Ahmedabad Bench of the ITAT set aside the order of the CIT (Exemption) rejecting approval under section 80G(5) and cancelling provisional approval, holding that the trust could not be denied 80G benefit merely because some objects or activities have an incidental religious element.
The Tribunal observed that the assessee was a composite charitable trust, primarily engaged in education, medical aid and relief to the poor. The objects relating to organising satsang and providing accommodation/food to Vaishnavs were held not to be purely religious, as these activities were meant for public welfare without discrimination and were ancillary to the dominant charitable purpose. Even if certain worship-related activities existed, they were only incidental, which is permissible under the Act.
On the issue of religious expenditure exceeding 5%, the ITAT found that the CIT(E) had treated several expenses (celebration, Granth Mahotsav printing, decoration) as religious on presumptions, without proper verification. Since rejection under section 80G is justified only if religious expenditure actually exceeds the statutory 5% limit, the Tribunal restored the matter to the CIT(E) to re-examine the nature and quantum of such expenditure after giving the assessee a proper opportunity.
Accordingly, the appeal was allowed for statistical purposes, with directions to grant 80G approval if, upon verification, religious expenditure is found to be within the permissible limit.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
