Bombay High Court to decide if Shirdi temple trust eligible for I-T exemption on anonymous donations

Mumbai: The Bombay High Court will soon decide whether the Shirdi-based Shri Sai Baba Sansthan Trust, which is both a charitable and a religious trust, is eligible for exemption from income tax on anonymous donations.

A division bench of Justices Girish Kulkarni and Somasekhar Sunderesan on Wednesday closed its orders on a plea filed by the Income Tax department challenging a October 2023 decision of an Income Tax Appellate Tribunal (ITAT), which held that since the trust is both charitable and religious, it is eligible for exemption from income tax on its anonymous donations.

As per the I-T department, the trust received overall donations of over Rs 400 crore till 2019, but only Rs 2.30 crore was spent for religious purposes, while major expenses are for educational institutions, hospitals and medical facilities, which shows it is only a charitable trust.

The court, before reserving the matter for orders orally, said the trust was receiving donations because of the faith of the devotees.

The trust claimed it had both charitable and religious obligations, and, hence it cannot be said it is either charitable or religious trust.

As per the assessing officer of the I-T department, between 2015 and 2019, the trust received huge amounts as anonymous donations.

This amount cannot be exempted from being taxed, the I-T department claimed.