- (1.) HEARD learned Counsel for the parties.
(2.) THE petitioner has challenged the order dated September 25, 1998, passed by the Commissioner of Income -tax, Udaipur (annexure -9)whereby the application of the petitioner -trust for renewal of exemption under Section 80G was refused, inter alia, on the ground that in one of the objects of the trust deed the construction of temples etc. was included though notwithstanding such inclusion in objects clause, no temples in fact have been constructed by it so far nor any expenditure of religious activities has been incurred by the petitioner -trust but because of the said object the trust was held to be having partly religious purposes. Learned Counsel for the petitioner has invited our attention to a number of decisions to urge that it is the substance of the objects of the trust in totality and the principal activity of the trust only should be taken into consideration and merely because one of many activities have been stated to be construction of the trust which in fact is not the basic purpose of formation of the trust, that should not be the sole criteria of rejection of the application.
(3.) HE also relied on the amendment brought in Section 80G by inserting Sub -section (5B) of Section 80G by the Finance Act, 1999, with effect from April 1, 2000, which was in consonance with the submissions made by learned Counsel for the petitioner which, inter alia, provided an overriding provision that where an institution or fund which incurs expenditure in the relevant year which is of religious nature for an amount not exceeding 5 per cent, of its total income in that previous year then for that previous year, the institution or fund shall be deemed exempted under Section 80G by deeming it to be so.;