Hindu trust denied tax exemption By Sandhya Jain on January 2, 2013

In sharp contrast to the solicitude shown towards religions of foreign origin, income tax authorities are discriminating against Hindu temples, while tribunals which exercise quasi-judicial powers are introducing bizarre claims into their decisionmaking process making a mockery of the Constitution and the countrys native majority community. Matters have reached a point where it may be desirable for the higher judiciary to step in and end this sorry state of affairs. In 2008, the Shiv Mandir Devsttan Panch Committee Sanstan, Nagpur, applied for income tax exemptions under section 80G (5) (vi) of the Income-tax Act, 1961. Giving details of income, it listed its total expenditure on various items. The Commissioner Income Tax said the expenses for building maintenance, free food, festival prayer & daily expenses related to religious object and only a small sum of Rs 6,700 was incurred for non-religious objects. He ruled that as the expenditure on religious object exceeds five per cent of the total income of the assessee trust, it was not doing charitable activities and was working for the benefit of a particular religious community and was hence not entitled to exemption. The Devsttan Committee moved the Income Tax Appellate Tribunal, Nagpur, saying that the temple is open to everybody irrespective of caste or creed or even without faith in the deities. The tribunals order (vide judicial member DT Garasia and accountant member PK Bansal) gave the trust the desired exemption, but seriously compromised the dignity and unity of the Hindu community. It is also at odds with the Constitution and established jurisprudence of over a century, and deserves correction. The order of October 2012 pronounced that Hinduism is a way of life of a civilized society and as such is not a religion. It cited TT Kuppuswamy Chettiar vs State of Tamil Nadu (1987) 100 LW 1031 wherein it was held, The word Hindu has not been defined in any of the texts nor in judgment made law. The word was given by British administrators to inhabitants of India, who were not Christians, Muslims, Parsis or Jews. The alleged Hindu religion consists of four castes Brahmins, Kshatriyas, Vaishyas and Sudras belonging ultimately to two schools of law, mitaksharas and dayabhaga. There is, however, no religion by the name Hindu. It only shows

that so-called Hindu religion has been called for convenience.

The tribunal declared that Hindu consists of a number of communities having different gods who are worshipped in a different manner, different rituals, different ethical codes, who have little in common except a vague faith in what may be called the fundamentals of the Hinduism. It said, the word community means a society of people living in the same place, under the same laws and regulations and who have common rights and privileges. This applies to Christianity or Islam but not to Hinduism. Hence, it cannot be said that Hindu is a separate community or a separate religion. According to the tribunal, the pertinent clause in the law stipulates that the institution or trust must not be for the benefit of any particular religious community or caste. It ruled that the trust was not promoting any particular religion, and that Lord Shiva, Hanumanji, Goddess Durga do not represent any particular religion and are merely

regarded to be the super power of the universe. On this bizarre logic, it granted the trust the desired exemption. The tribunals ruling is clearly faulty and insulting to the Hindu majority. It is well known that the word Hindu is a Persian mispronunciation of Sindhu (Indus), and Hindustan the land beyond this river. Though originally geographical in nature, the word Hindu had ancient lineage centuries before the British advent. When monotheistic faiths entered India and practiced exclusivity, the term came to be applied to the Sanatana Dharma and its native adherents. Sanatana Dharma is inclusive and respectfully accommodates all the village, jati/kula, regional, and panIndian gods and goddesses. The proper equivalent of caste is jati, and Brahmins, Kshatriyas, Vaishyas and Sudras are not castes but varnas (categories of social organisation). The tribunal noted that all Hindus follow one of two schools of law mitakshara and dayabhaga, and this is the crux of the matter. The tribunal should know that Hindu religious customs were codified into law by the British, and Hindu law is an intrinsic part of the countrys legal framework, which is why we have the Hindu Code Bill and the Hindu Marriages Act. Hence the argument that Hindu is not a religion is legally untenable. Second, if the myriad Hindu groups follow either the mitakshara and dayabhaga school of law, it debunks the claim that Hindu is not a distinct religion or people. The tribunal has asserted that the plethora of jatis (clans claiming descent from a common ancestor) that worship specific village deities (grama devata), clan gods (kula devata), territorial deities (sthan devatas), personal gods (istha devata), or regional deities (such as Jagannath of Puri), all of whom are worshipped with different prayers and rituals, do not comprise the Hindu religion and people. Actually, all divinities in Hindu tradition are linked to the major gods of the pan-Indian pantheon. Hinduisms greatness lies in not erasing the numerous natal traditions to create a monotheistic edifice with uniformity of worship and custom. To pronounce that there is no Hindu religion or community is a form of iconoclasm as it privileges creeds that are not native to the soil. It is learnt that the Income Tax Department is likely to challenge the tribunals decision before the High Court. Hindus fighting to retain the tax exemption for the trust must fight for honorable recognition as the native religion and civilization ethos of India. (Image courtesy: mynameisharsha) Related Links On the making of our Look East Policy Gujarat and Congress have always stood apart Mahabharat inspires our military culture Balijatra is a celebration of Odishas glorious cultural history An intimate, objective account of Indira Gandhi

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Post a comment Comments (10) 1. VikasReply January 2, 2013 at 9:49 pm so in that sense Hindus are minority in the country..hence hindus must be given reservations,tax exemptions,personal civil law etc.shame on congress and their dogs 2. Pingback: Hindu trust denied tax exemption - Sandhya Jain Archives 3. Arun ShrivastavaReply January 3, 2013 at 12:28 am I remember back in 1972 one Canadian Christian Church penalized by an Income Tax Officer heavily for claiming exemption and not stating their income correctly. It is time that Parliamentarians remove this anomaly of officers interpreting Hinduism as they feel like. This is our country and senior officers should know that India is under attack socially and culturally in addition to economically. 4. AkhandReply January 3, 2013 at 9:18 am Pro-Hindu apex bodies (RSS, VHP, etc.) should constitute legal cells and seek legal recognition to maximise benefits to the majority community. 5. ArvindReply January 3, 2013 at 10:31 am What was done by Nda when it was in power or what is being done by states ruled by Nda to address this discrimination?
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Abhishek TondonReply January 3, 2013 at 1:56 pm Youre educated enough to realize that NDA had entire bunch of secular (read pro minority-appeasement) parties including JDU, TDP, TMC and even National Conference! BJP+SS had barely 200 seats! We want betterment of Hindus and equality for all Indians, lets hand over absolute majority to BJP under Modi, else no point wailing. Sleepwalking to destruction has gone on and will go on otherwise.

6. vibrantindiaReply January 3, 2013 at 10:32 am Well Done IT Tribunal.Hindu is not religion.Hindu must convert to Christianity. 7. MurthyReply January 3, 2013 at 12:54 pm The author is right to highlight this unfortunate and mischievous line of reasoning by some government authorities in India. It is wrong for them to confuse the variety in Hindu practices as a negation of religion and community. From earliest times, let us say the era of Gautama buddha, the following features of Hinduism were recognised as giving it an identity as a Panth or religious system:

a) Sacred Literature formally headed by the Vedas and down to the works of Dharma Sastra, such as Mitakshara and Daya Vibhaga b) Samskaras essential ceremonies to mark the different stages from birth to death c) Duties and Obligations every member of a Hindu family, throughout India, has had to meet his or her responsibilities as set out in Literature common to all Hindus, such as the Smritis and many moral treatises, such as Niti Sataka, Thirukkural (in Tamil) and so on. They all propagate values common to all Hindus. d) Pilgrimages to Temples and Rivers of India From the time of the Great Buddha, Hindus have been going to Pilgrimage Centres of India, from Amarnath to Rameshwaram. I could go on with a few more points to show that HINDUISM has been, and today remains, a RELIGION. But due to space constraints, I stop here. 8. AkaulaReply January 3, 2013 at 6:59 pm What Tax department has said is a hotchpotch of opinions put together to draw a conclusion. And lack of counter consistent argument. (1) Where as it is true Hinduism is not a religion rightly indicated by the Tax departments, there second assertion that Hinduism is a way of living is wrong. They can not quote any (not current ignorant sources) source to show that Dharma is a way of life. Hinduism is the popular word coined for Sanaatana Dharma. (2) Dharma, a Samskrutam word, arises from Dhar + ma. The Dhar arises from the Dhatu Dhrinya, implies that supports that sustains that maintains. As in Dharati. The ma arises from root Maange implying maapna measurablity and also mother. Thus Dharma is a category that is refers to supporting structure qualities of a measurable entity. In particular if that Dharma is maintained (protected) then it in turn protects the entity whose Dharma is being considered. Hence the whole mistranslation of Dharma as religion is problematic for us in all spheres. To start with you can not apply secularism to Dharma, since it is not religion. You can not exclude it from official study in colleges and schools, since it contains Indian ethos and investigation. Dharma when applied to natural phenomenon is sciences and when applied to social phenomenon is politics, sociology, economics, law justice, when applied by individual to himself/herself is yoga, Yajynya etc. So it can not be excluded in any part of the Indian activity. For we may have different opinions of Dharma in a particular context but it is common to all Jaina, Baudha, Sikhs, Hindu etc. It is not applicable to Christianity and Islam. Given this understanding large number of Institutions dedicated to several different aspects of Dharma will gain (a) tax exempt status, (2) Traditional Darshana will have to be taught in university without being accused of violating sickular ethos, (3) Laws will have to be coined according to the local world view of Dharma, (3) Local view points of Dharma based Economics will have to be considered. These changes will remove improve the nation, link the populace with its ethos, (4) will link individual to the nation etc., etc. So the Thank you push should be in that direction.

9. Shiv RamReply January 4, 2013 at 8:05 am This is an eye opener. Hindus are the enemies of Hindus.

Religious trusts protest abolition of tax exemption TNN Jun 29, 2011, 12.38am IST

Tags: Yashwant Sinha AHMEDABAD: It's rare to see leaders of various religious sects getting together for a common cause. On Tuesday, members of Hindu, Muslim, Jain, Parsee, Swaminarayan and Christian trusts came together under a federation to voice their protest against propositions in Direct Tax Code (DTC). The soon to come new tax regime will make religious and charitable trusts pay taxes. The members gathered under 'Federation of Charitable and Religious Trusts' at ATMA hall and agitated against the DTC bill which they said proposes to take away exemptions of religious trusts under income and wealth tax. "Definitions of non-profit organizations which will enjoy income and wealth tax exemptions exclude trusts or institutions established for a particular caste or religious community excludes religious trusts and will have to pay tax at flat rate of 30 %. But Income Tax Act of 1961 has exempted all charitable trusts for particular religious communities set up prior to April 1 1962 from income tax and wealth," said counsel Yousuf Muchalla. Trustees said that if implemented the provisions in DTC will pull down shutters of many such organization. The federation has made representations to the government and has also met with former finance minister Yashwant Sinha who heads the parliamentary standing committee on finance.

Allahabad High Court Commissioner Of Income-Tax, C.P. ... vs Shri Dwarka Dheesh Temple, ... on 4 January, 1945 Equivalent citations: 1946 14 ITR 440 All JUDGMENT This is a case stated to us under Section 66 of the Indian Income-tax Act by the Income-tax Appellate Tribunal. The assessee is a temple known as the Shri Dwarka Dheesh Temple of Cawnpore and the assessments which are brought into question are those for the assessment years 1939-40, 1940-41 and 1941-42. The facts as stated by the statement of the case are relatively simple. It appears that the temple was founded in the year 1883 but was not consecrated until the year 1886. On the 11th July, 1887, there was what is described as an instrument of dedication. This document, which is Ex. T-K., dealt with a sum of Rs. 42,000 which had apparently been collected for the purpose of building and endowing the temple, and out of it Rs. 20,000 had been spent on the construction of the temple itself, a further Rs. 5,000 had been spent on ornaments and Rs. 17,000 remained to be disposed of. The deed declared that this balance should be invested in the purchase of particular type of immovable property or should remain "deposited" at interest, and proceeded at some pains to make it quite clear that the donors of the fund had released all interest in it. It then in a somewhat inadequate way went on to provide for the management of the temple, but it is clear that some further and more comprehensive document was contemplated. However, as far as it goes, the investment of 11th July, 1887, makes it abundantly clear that the seventeen thousand rupees in question was to be used exclusively for the purposes of the temple. In the interval of time between 1887 and now, the fund, of which the original Rs. 17,000 is now part, has multiplies itself many times over and we are told that it is now represented by a sum of several lakhs of rupees whether in money, property or investments and it is with the income of this substantial fund that we are now concerned. To put the matter shortly, the income is received by certain members of

the original settlors family as trustees and the Income-tax authorities now claim that this income is taxable. The question in the form in which it comes to us involves Section 4, sub-section (3), of the Indian Income-tax Act. That sub-section exempts from the charge of Income-tax :"(1) Any income derived from property held under trust or other legal obligation wholly for religious or charitable purposes, and in the case of property so held in part only for such purposes, the income applied, or finally set apart for application, thereto." This exemption is, however, qualified by a final proviso which runs thus :"In this sub-section charitable purposes includes relief of the poor, education, medical relief, and the advancement of any other object of general public utility, but nothing contained in clause (i).....shall operate to exempt from the provisions of this Act that part of the income of a private religious trust which does not enure for the benefit of the public." The answer, accordingly, given by the assessee to the Income-tax Officer is that the income in question is "derived from property held under trust for religious or charitable purposes." The Income-tax Officer, however, counters this by saying that the income in this case is merely the income of "a private religious trust which does not enure for the benefit of the public." We concede that this issue raises both questions of fact and questions of law, or possibly mixed questions of fact and law. Turning now to the statement of case, we have to see what facts are presented in order to decide the question of law to set up. The question has been stated by the Incometax Tribunal in the following language :"Whether in the circumstances of the case the Shri Dwarka Dheesh Temple Trust, Cawnpore, is a public religious trust and as such whether the income derived by the trust is exempt from taxation under Section 4(3)(i) of the Income-tax Act ?"

The facts stated by the Appellate Tribunal in their statement of the case are these. First, we told that the public have from the very beginning exercised the right of going to the temple and worshipping the deity there. Secondly, we are told that the income of the temple properties is spent on Sadavart, Pathashala, Dharmshala, Bhog, Utsav etc., thirdly, that for foregoing benefits are open to the public, who come there to get them, in their own right. Fourthly, that every day some 100 or 150 members of the public come to the temple for worship and, fifthly, that there is no prohibition of any kind upon anyone having access to the temple, except the single qualification that he must be sober. Moreover, the Tribunal has stated as a fact that the temple has throughout been treated as a place of public worship and its properties have always been administered as belonging to a public trust. Now, those are the facts before us. The Income-tax department, which in this case is the applicant, makes a point of the circumstances that the instrument of 1887 is silent as to whether this trust is a public or a private trust. It is true that it is not stated in so many words in the document itself whether the trust is a public or private one and there is no presumption one way or the other. When we look, however, at the course of events during the intervening fifty years stated as facts in the case now before us, no doubt can possibly be left in anybodys mind but that there was ample evidence upon what the Income-tax Officer could have concluded, as the Tribunal has now concluded, that this was a public, and not a private trust. We have pressed hard by Mr. Pathak to go behind the statements of facts set out in the statement of the case by the Appellate Tribunal. The suggestion is that if we were to do this, we might find other facts which might or might not shake the conclusions of fact stated to us. As a matter of principle we do not think that any jurisdiction is entrusted to us by Section 66 of the Income-tax Act either to go behind or to questions statements of fact made by the Appellate Tribunal in the statement of a case. Our only jurisdiction is that, if in any case we are not satisfied that the statements contained in the statement of the case are sufficient to enable us to determine the question raised by it, we have power to send it back to the Appellate Tribunal for a second statement of facts. Here it is impossible to say that the facts as stated in the statement of the case were insufficient to have enabled the Income-tax Officer to conclude that the trust in this case was from

the beginning, and is now, a public trust. That is sufficient to dispose of the matter upon the ground that this religious trust is not a private one at all but it is a public one. Even if this had been so, the findings of the Appellate Tribunal would still have been ample to show that the income of the trust, whether public or private, enures for the benefit of the public. For these reasons we answer the question put to us by saying that the assessee temple is a public religious trust, and, as such, is exempt from taxation in respect of the income derived from the trust in question by virtue of Section 4(3)(i) of the Indian Income-tax Act. The respondent assessee is entitled to his costs of this reference. We fix the fee of the learned counsel appearing for the department at two hundred rupees. Reference answered accordingly.