International Sufi Centre vs DIT (Exemptions)

This appeal is filed by the assessee challenging the order passed by the authorities declining to grant recognition u/s 80G of the Income Tax Act (for short hereinafter referred to as the Act).

The assessee filed an application in Form No.10G in duplicate on 25-11-2008 seeking approval u/s 80G of the Act on the ground that it is a trust established by way of a trust deed dated 5-1-2005 for the purpose of propagating Sufism.

The trust has been granted registration u/s 12(A) as a Religious Trust by the order dated 26-5-2009. Explanation 3 to section 80-G(5) of the Act clearly lays down that "In this section charitable purpose does not include any purpose the whole or substantial the whole of which of a religious nature". Section 80-G(5) makes it clear that the exemption is eligible only if it is established for a Charitable Purpose. If the activity of the assessee is not a charitable purpose, then the assessee is disqualified from claiming exemption u/s 80G(5). The Assessing Authority, after going through the provision of the trust deed, held that the objects and the activities of the trust are substantially religious in nature and therefore the assessee does not meet the condition laid out in section 80-G(5) and specifically 80-G(5)(ii), 80-G(5)(iii) and 80-G(5B) of the Act. Therefore, he rejected the application for recognition u/s 80-G. Aggrieved by the same, the assessee preferred an appeal to the Tribunal. The Tribunal on going through the clauses of the trust deed noticed that Sufism is a branch of Islamic spiritualism and its study and practice is known as "Tasawuff" (Gnosis), which is divided into four branches "Shariat" (Common Law), "Tariqat" (Spiritual Path), "Ubudiat" (servant hood - unity with Allah) and "Marifat" (Allah realization - Gnosis). It also noticed that Sufism is practiced by Sunni Muslims. The provision for disqualification made it clear that any trustee in the Board of Trustees shall cease to be a Trustee on his ceasing to be a Sufi and or renouncing his faith in Sufism and in Islam. Therefore they are not entitled to exemption. It also took note of the balance sheet filed and the purpose for which the money is spent and came to the conclusion that they have not utilized any funds for charitable purpose at all. Therefore, it upheld the order of the Assessing Authority and dismissed the appeal. Aggrieved by the same, the assessee is in appeal.

The learned counsel appearing for the assessee assailing the impugned order contends that Sufism is not pertaining to any particular religion. Sufism is a way of life. It teaches humanism, love, brotherhood and oneness and believes in creating a world through Tauheed. Therefore, he contends that the authorities committed a serious error in denying the exemption

In the memorandum of Trust Deed, the aims and objects of the trust, Sufism has been defined as one, which teaches humanism, love, brotherhood and oneness and believes in creating a world citizenship through "Tauheed". It is further stated that Sufism is a way of life to achieve perfection in manners, cultivate and culture of the mind and heart with purity of thought and good behavior, through possession of all virtues and negation of all vices by a process of self-nnihilation, self-realization, self-sacrifice and surrender of will before the supreme will of almighty Allah. Therefore, it is clear that Sufism accepts a person who surrenders before almighty Allah and that is the object. Further, it state that Sufism is absolutely peaceful and a totally non-violent movement to awaken the soul to greater grandeur through simple living and practicing lofty ideals through meditation Zikr, Sama and other sufi practices by accepting the Risalst of Holy Prophet Mohammed by strengthening of Faith (Yaqeen) by protecting his precepts and performances of daily Namaz (prayers) through acts and deeds of righteousness by seeking and observing Taqwa (the awe of Allah), Taubah, (repentance), Tawakkal (trust in Allah), Iklas (sincerity), Sidq (truthfulness), contentment, etc., and in Istiqama (uprightness), "state" in which Allahs grace comes perpetual for it implies the perfect performances of Allahs service, firasa (insight, as Prophet (PBUH) said "Beware of the Believers, insight, for he sees with the sight of Allah). It clearly declares that Sufi is a branch of Islamic spiritualism and its study and practice is known as "Tasawuff" (Gnosis), which is divided into four branches "Shariat" (Common Law), "Tariqat" (Spiritual Path), "Ubudiat" (servant hood - unity with Allah) and "Marifat" (Allah realization - Gnosis). In so far as the status is concerned, it declares that it is a non-political charitable, social, cultural and literary organization solely for sufistic studies and works for its promotion and it is open to all citizens irrespective of caste, creed or religion of the world. It declares that Sufism is oracticed by Sunni Muslims and who are not particularly associated with any political party or any religious group. The office bearers of this trust are all persons belonging to Sunni Muslims. The provision of disqualification declares that any member of the Board of Trustees shall cease to be a trustee on his ceasing to be a Sufi and/or renouncing his faith in Sufism and in Islam.

Therefore, it is clear from the aforesaid recitals that Sufism is a part of Islam. Probably, it is a wing propagating Islam religion. Merely, because the said document contains the aspects of culture, social and non-political organization, it will not come under the category of Charitable Institution. The contents of the said document make it very clear that the whole object is to spread and preach Islam, a religion. Therefore, the authorities were justified in declining to grant recognition. There is a specific bar for granting such exemption to such a religious trust. We do not see any exemption to such irregularity committed by the authorities. The orders passed by the authorities are legal and valid and do not call for any interference. No substantial question of law is involved in this appeal to entertain the same. Accordingly it is dismissed.