- (1.) The two question which have been referred to his court are as follows : "(1) Whether, on a true construction of the deed of trust dated 15th September, 1941, the trust in question was a public religious and charitable trust and as such the income of the trust is exempt under section 4(3)(1) of the Income-tax Act, 1922 (2) If the answer to question No. 1 is in the negative, whether the Tribunal was right in holding that section 41 of the Indian Income-tax Act, 1922, was application and the assessment of tax was to be made at the maximum rate -
(2.) The first point refers to the deed itself and, therefore, let me refer to the deed which is printed at page 20 of the paper-book. The deed provides as follows : "To Have And to Hold the said premises set out in the schedule hereunder written unto the said Protapmull Bagaria, Ranglal Bagaraia, Gangadhar Bagaria, Indra Chand Bagaria and Onkarmull Jhoonjhoonwalla upon the trusts and for the purposes hereinafter mentioned, viz : (a) The name of the trust hereby created shall be styled Sreemati Ganeshi Debi Sreemati Rami Debi Charitable Trust ...... (c) The trustees shall out of the income to be derived from the trust property duly carry on the worship of the said deities Sri Ram Sita and Lakshman installed at Sujangarh confirmed (sic) by the parties hereto of the Second Part and shall spend Rs. 250 (rupees two hundred and fifty monthly and every month for the daily and periodical pujas and shebas of the said deities Shri Ram Sita and Lakshman and sadabrata and shall spend Rs. 25 (rupees twenty-five) monthly and every month for upkeep of the Dharamsala called Seth Sujanmuall Protapmull Bagaria Dharamsala at Taura and said piyau and kund at Sujangarh Bazar and shall spend Rs. 125 (rupees one hundred and twenty-five) monthly and every month for the Sanskrit Patasala known as Seth Sujanmull Protapmull Bagaria Sanskrit Patasala at Sujangarh. (d) The trusees shall in the next place pay an annuity of Rs. 50 to Baikishan Devi and a sum of Rs. 25 to Baimanbhari every month during the term of their natural life. (e) The trustees shall pay a sum in course of any month not exceeding Rs. 50 to each of the settlors to be spent by them or her for such charitable and religious purposes as they or she may desire. (f) The amount remaining as balance after meeting the above mentioned outgoings and annuities and allowances as aforesaid shall be held by the trustees fund to be called Ganeshi Debi Rami Debi Charity Trust Reserve. (g) In case the income of the trust property at any time be found insufficient to meet the outgoings and expenses hereinbefore provided it shall be lawful for the trustees to apply the said reserve fund known as The Ganeshi Debi Rami Debi Charity Trust Reserve for the purpose of meeting such deficiency and if at my time the reserve fund in the hands of the trustees be found by the trustees as insufficient to meet the outgoings charges and expenses and payment directed to be made by these presents then and in that case all charges and expenses for performance of sheba as mentioned in clause (c) shall abate proportionately provided that before touching the said reserve fund the trustees are to take the consent in writing from the settlors. (h) The trustees shall at their discretion be at liberty to spend out of the said reserve fund known as The Ganeshi Debi Rami Debi Charity Trust Reserve such sums of money from time to time for distribution of alms to the poor and contribution to hospitals or other religious or educational institutions as they shall think fit with consent of the settlors and after the death of the settlors with the consent of the nominees of the settlors as hereinafter appointed."
(3.) This trust deed was considered by the Income-tax Officer and it was considered not to be a public religious and charitable trust. Regarding the Sanskrit patasala the objection of the Income-tax Officer was that all the students belonged to one particular community, namely, Brahmin. Therefore, it would not be for the benefit of the public. With regard to Dharamsala his comment was that the building was dilapidated and therefore it could hardly be called a dharamsala. With regard to the temple of Rama, Sita and Lakshman the Income-tax Officer found that there was no managing committee. It was pointed out that sadhus and Brahmins were given food and refreshment after pujas. This, according to the Income-tax Officer, was not a public charitable purpose recognised by law. According to him, in order to be a public religious and charitable trust, the larger section of at least of the same religion to which the settlors belong must have a right to worship and they must have aright to take a food and refreshment after the daily puja.;