COMMISSIONER OF INCOME-TAX vs. SHRI DARUL ULLAM HASANIA

PDF · subscribers
ITR/116/1997HC GujaratGJHC24020280199730 August 2006Bench: HONOURABLE MR. JUSTICE M.R. SHAH,HONOURABLE MR. JUSTICE R.S.GARG3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that the assessee is entitled to exemption under Section 11 of the Income Tax Act. The Court relied on its previous judgment in ITR No. 234 of 1995 (CIT vs. Chandra Charitable Trust), which in turn relied on the High Court's decision in Commissioner of Income Tax vs. Barkate Safiyah Society (213 ITR 492). The reasoning was that if the trust can be addressed as a 'Charitable Religious Trust', then Section 13(1)(b) of the Act would not be applicable. Consequently, the references were decided against the interests of the Revenue. The operative direction was to dispose of both references accordingly, with no costs.

What were the facts?

The Income Tax Appellate Tribunal, Ahmedabad Bench, referred two questions of law to the Gujarat High Court concerning the assessee, Darul Ullam Hasamia. Income Tax Reference No. 69 of 1997 pertains to Assessment Years 1982-83 to 1984-85, and Income Tax Reference No. 116 of 1997 relates to Assessment Years 1985-86 and 1986-87. The core issue in both references is whether the assessee trust is entitled to exemption under Section 11 of the Income Tax Act, 1961, despite being established for the benefit of a particular religious community. The High Court noted that the facts in these references are identical to a previous case, ITR No. 234 of 1995 (CIT vs. Chandra Charitable Trust), decided on July 31, 2006.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the assessee is entitled to exemption under Section 11 of the Income Tax Act? (Question of law) 2. Whether the Appellate Tribunal is right in law and on facts in confirming the order passed by the CIT (Appeals) directing the Assessing Officer to grant exemption under Section 11 to the assessee trust though the trust is meant for the benefit of the particular religious community? (Question of mixed law and fact, turning on Section 11 and Section 13(1)(b) of the Income Tax Act). Assessee's Contention: The assessee, Darul Ullam Hasamia, is entitled to exemption under Section 11 of the Act. The judgment does not explicitly record the assessee's arguments but implies they rely on the trust being a 'Charitable Religious Trust' and that Section 13(1)(b) would not be applicable. Revenue's Contention: The revenue contends that since the trust is meant for the benefit of a particular religious community, it should not be granted exemption under Section 11. The judgment does not explicitly record the revenue's arguments beyond the framing of the question.

Which sections of the Income-tax Act were involved?

Section 11,Section 13(1)(b)

AI-generated summary — verify with the full judgment below

ITR/69/1997 1/3 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD INCOME TAX REFERENCE No. 69 of 1997 With INCOME TAX REFERENCE No. 116 of 1997 For Approval and Signature: HONOURABLE MR.JUSTICE R.S.GARG HONOURABLE MR.JUSTICE M.R. SHAH ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================================= COMMISSIONER OF INCOME-TAX - Applicant(s) Versus DARUL ULLAIM HASANIA - Respondent(s) ========================================================= Appearance : Mrs. Mauna BHATT for Applicant(s) : 1, MR B.D. Karia for Respondent(s) : 1, ========================================================= CORAM :  HONOURABLE MR.JUSTICE R.S.GARG and HONOURABLE MR.JUSTICE M.R. SHAH Date : 30/08/2006 ORAL JUDGMENT (Per : HONOURABLE MR.JUSTICE R.S.GARG)

ITR/69/1997 2/3 JUDGMENT

The Income Tax Appellate Tribunal Ahmedabad Bench ,

'A' has referred the following question to this Court for its

opinion in relation to Income Tax Appeal No 2862 to / /

- 2864 Ahd 1988 pertaining to Assessment Year 1982 83 to 1984 ; 85

'Whether on the facts and in the

circumstances of the case the assessee is

entitled to exemption u nder sec 11 of the

Act ?' . 2

, In Income Tax Reference No 116 of 1997 the

Income Tax Appellate Tribunal Ahmedabad Bench 'C' has

referred the following question for opinion of this Court in

. & / / relation to Income Tax Appeal No 1363 1363A Ahd 1992

- ; pertaining to Assessment Year 1985 86 and 1986 87 ,

'Whether the Appellate Tribunal is right in

law and on facts in confirming the order

. . . ( )

passed by the C I T Appeals directing the

Assessing Officer to grant exemption under

section 11 to the assessee trust though the

trust is meant for benefit of the particular

religious community ?'

It is to be noted that the assessee Darul Ullam Hasamia is the

common assessee in both the matters The questions posed for

our consideration are whether the assessee Trust would be

entitled to exemption under Section 11 of the Income Tax Act

though the Trust is meant for the benefit of the particular

. religious community

ITR/69/1997 3/3 JUDGMENT . 3 . . . .

In I T R No 234 of 1995 between . . . . C I T Vs Chandra

, Charitable Trust

. .

decided on 31 7 2006 we have decided the

identical question after placing our reliance on the judgment of

. this Court in the matter of Commissioner of Income Tax Vs

Barkate Safiyah Society 213 ITR 492 and have observed that

, , the Trust can be addressed as a 'Charitable Religious Trust' and

( )( )

. if that be so Section 13 1 b would not be applicable The

facts of the cases are identical In view of the earlier judgments

of this Court and our Judgment in the matter of Chandra

( ) Charitable Trust supra ,

we decided both the References against

the interests of the Revenue The

. References shall stand disposed of accordingly No costs [ . . , . ] R S Garg J . rmr [ . . , . ] M R Shah J

More judgments on Section 11

All 7,190 judgments and leading authorities on Section 11 →

Recent GST High Court judgments

Search GST case law →