JUDGMENT H.N. Seth, J.
1. At the instance of Messrs. Surjidevi Kunji Lal Jaipuria Charitable Trust, hereinafter referred to as the assessee, the Income-tax Appellate Tribunal, Allahabad Bench, has referred the following question of law arising in respect of the assessment year 1961-62, for the opinion of this court:
"Whether, on the facts and in the circumstances of the case and on a proper interpretation of the declaration and the terms and conditions of the deed of trust dated April 24, 1958, it could be held that the trust was not entitled to exemption under Section 4(3)(i) of the Indian Income-tax Act, 1922?"
2. The assessee-trust was created under a deed dated 24th April, 1958. Objects for the creation of the trust as given in Sub-clause (2) of Clause 3 of the deed ran thus :
"To apply or spend out of the balance of such interest, dividend and income if the trustees unanimously agree even out of the corpus of the trust fund any amount for the following objects and purposes and so that the decision of the trustees as to the object of the trust or the beneficiaries shall be final and binding on all persons claiming under this trust and shall not be questioned in any court of law or otherwise howsoever :--
(i) For giving monetary help to poor deserving members of the Vaishya community.
(ii) For giving financial help by way of gift, or loan without interest, to enable the poor and deserving members of the Vaishya community to set up any business, profession or vocation.
(iii) For giving financial help in the shape of money, books or otherwise for education (primary school, college and higher education and technical or non-technical education) to the poor and deserving members of Vaishya community.
(iv) For giving help, financial or otherwise, on the occasion of marriage of members of the Vaishya community.
(v) For giving medical aid in money or in kind to the members of the Vaishya community.
(vi) For social welfare, uplift and generally for improving the condition of poor members of the Vaishya community.
(vii) For giving help without reference to caste or creed in times of calamity, melas, famine, earthquake, fire, cyclone, flood and the like.
(viii) For any other object of general public utility preference being given in the discretion of the trustees to the members of the Vaishya community."
3. For the assessment year 1961-62, the assessee's total income was computed at Rs. 586. The Income-tax Officer held that the assessee had derived the aforesaid income from property held under trust wholly for religious or charitable purposes. Accordingly, as provided in Section 4(3) of the Indian Income-tax Act, 1922, such income was not liable to be included in the total taxable income of the assessee. The Commissioner of Income-tax, U. P., Lucknow, however, did not agree with the view expressed by the Income-tax Officer and as he considered that the order passed by the Income-tax Officer was prejudicial to the interest of the revenue, he required the assessee to show cause as to why appropriate action under Section 263(1) of the Income-tax Act, 1961, be not taken with regard to its assessment for the year 1961-62. Relying upon the cases of Trustees of Gordhandas Govindram Family Charily Trust v. Commissioner of Income-tax [1952] 21 ITR 231 (Bom) and Kedia Jatiya Sahayak Sabha and Fund v. Commissioner of Income-tax [1963] 49 ITR 74 (Cal), the Commissioner of Income-tax found that the following objects mentioned in the trust deed were not charitable objects ;--
(i) For giving monetary help to poor and deserving members of the Vaishya community ;
(ii) For giving financial help by way of gift or loan without interest to enable the poor and deserving members of the Vaishya community to set up in any business, profession or vocation ;
(iii) For giving financial help or otherwise on the occasion of marriage of members of the Vaishya community ;
(iv) For social welfare, uplift and generally for improving the condition of poor members of the Vaishya community.
4. He then referred to the cases of Mohammad Ibrahim Riza Malak v. Commissioner of Income-tax, AIR 1930 PC 226, and East India Industries (Madras) P. Ltd. v. Commissioner of Income-tax [1967] 65 ITR 611 (SC) and held that if there were several objects of the trust some of which were charitable and some non-charitable, and it was open to the trustees to apply the income to any of the objects, the whole trust failed and no part of the income is exempt from tax. He accordingly set aside the order passed by the Income-tax Officer and directed him to make a fresh assessment.
5. The assessee then filed an appeal before the Income-tax Appellate Tribunal, Allahabad Bench, Allahabad. Before the Appellate Tribunal the assessee conceded that two of the objects mentioned in the trust deed, viz., (1) for giving financial help or otherwise on the occasion of marriage of members of the Vaishya community; and (2) for social welfare, uplift and generally for improving the condition of poor members of the Vaishya community, may be treated as being not of public charitable nature but claimed that even then the income of the trust would be exempt from being included in the assessee's total income. The Appellate Tribunal accepted the assessee's contention that the trust having come into existence prior to the Income-tax Act, 1961, according to which such exemption cannot be claimed in respect of the income of the trust or institution created or established for the benefit of any particular religious community or caste, its provisions will not apply to the income under consideration and merely because the charity was intended to benefit generally the members of the Vaishya community the trust will not cease to be a charitable trust entitled to the benefit of Section 4(3)(i) of the Indian Income-tax Act, 1922. Accordingly, two of the clauses, viz, that for giving monetary help to poor and deserving members of the Vaishya community and that for giving financial help by way of gift or loan without interest to enable the poor and deserving members of the Vaishya family to set up in any business, profession or vocation may not be held to be non-charitable objects. However, in view of the decision of the Bombay High Court in the case of Trustees of Gordhandas Govindram Family Charity Trust [1952] 21 ITR 231 and of the Calcutta High Court in Kedia Jatiya Sahayak Sabha and Fund [1963] 49 ITR 74, the assessee conceded that the remaining two objects, viz., (1) for giving financial help or otherwise on the occasion of marriage of members of the Vaishya community ; and (2) for social welfare, uplift and generally for improving the condition of poor members of the Vaishya community, are not such objects which could be described as charitable objects. In view of this concession, the Tribunal proceeded on the basis that although some of the objects of the trust were of public charitable nature yet some others were not such objects. It held that, apart from objects nos. (vii) and (viii) of the trust deed, the remaining objects were independent objects and none of them could be described as subsidiary in nature. Since the trustees have full discretion to spend the income of the trust both for charitable and non-charitable purposes it could not be said that the assessee was holding property under a trust wholly for religious or charitable purpose. Following the decision of the Supreme Court in the case of East India Industries (Madras) P. Ltd. v. Commissioner of Income-tax [1967] 65 ITR 611, it held that the assessee was not entitled to the benefit under Section 4(3)(i) of the Indian Income-tax Act, 1922.
6. Before the Tribunal, the main argument raised on behalf of the assessee was that the preamble to paragraph 3 of the trust deed indicated that the settlor was desirous of making a charitable trust. Accordingly, such objects which did not fall within the category of charitable purposes had to give way to the predominant charitable objects. Accordingly, such of the objects mentioned in the trust deed which were not of a charitable nature, became innocuous and could not be enforced. Since all the enforceable objects were charitable in nature the assessee could not be denied the benefit of Section 4(3)(i) of the Indian Income-tax Act, 1922. The Tribunal repelled this objection and dismissed the appeal filed by the assessee. Subsequently, at the instance of the assessee the Tribunal referred the aforesaid question of law for the opinion of this court.
7. Learned counsel for the assessee argued that the two objects, viz, (1) that of giving financial help or otherwise on occasions of marriage of members of the Vaishya community, and (2) for social welfare, uplift, and generally for improving the condition of poor members of the Vaishya community regarding which it had been conceded before the Appellate Tribunal that they were not charitable in nature, were in fact objects of public charity. Accordingly, all the objects of the assessee trust were of public charitable nature and its income was exempt from being included in its total income as provided in Section 4(3)(i) of the Indian Income-tax Act, 1922.
8. Learned counsel for the revenue contended that in a reference under the Income-tax Act, after conceding before the Tribunal that two of the objects mentioned in the trust deed could not be classified as objects of public charity, it is not open to the assessee to take up the stand that the Tribunal went wrong in acting upon that concession. Such an argument does not arise from the appellate order of the Tribunal. Learned counsel for the assessee urged that the aforesaid concession was made by it in view of the decisions in the cases of Trustees of Gordhandas Govindram Family Charity Trust [1952] 21 ITR 231 (Bom) and Kedia Jatiya Sahayak Sabha and Fund [1963] 49 ITR 74 (Cal) and he cannot be prevented from urging that the decision rendered in those two cases required scrutiny by this court.
9. In the case of Commissioner of Income-tax v. Shiv Nath Prasad [1970] 77 ITR 378 (All), a Division Bench of this court has held that under the Income-tax Act it is only a question that had been raised before or decided by the Tribunal that can be said to arise out of the Tribunal's appellate order and be referred to the High Court. It also observed that once on behalf of the department it was conceded before the Tribunal that the amount of sales tax when collected by a dealer did not become his income liable to tax immediately on receipt thereof and that it became his taxable income only when the dealer did not pay it to the Government in the relevant accounting year, the question whether or not the amount of sales tax when received by the assessee was liable to tax, was never agitated before the Tribunal and it could not be deemed to be a question which arose out of the Tribunal's appellate order. Similarly, in the case of Karnani Properties Ltd. v. Commissioner of Income-tax, [1971] 82 ITR 547, 550, 551 (SC), it has been observed by tbe Supreme Court as follows :
"In the appeal before the Appellate Assistant Commissioner the only controversy was whether the receipt held by the Income-tax Officer as income from other sources should have been held to he income from business. Neither the revenue nor the assessee contended that the same was assessable under Section 9 ; nor was there any dispute as regards that part of the receipt which was brought to tax under Section 9......The assessee contended that the said amount should have been assessed under Section 10 and the department's case was that the Income-tax Officer had rightly assessed the same under Section 1 2. Neither the assessee nor the department contended before the Tribunal that the same was assessable under Section 9. The Tribunal accepted the contention of the assessee that the amount in question is assessable under Section 10. Thereafter, at the instance of the department the question set out earlier was referred to the High Court of Calcutta for its opinion.
The High Court of Calcutta did not accept the contention of the department that the amount in question is assessable under Section 12 of the Act. On the other hand, it came to the conclusion that the same was assessable under Section 9 of the Act. As seen earlier the department had all along proceeded on the basis that that amount was not assessable under Section 9 of the Act......The department, having all along proceeded on the basis that the income of the assessee was income from two different sources, should not have been allowed to change its case.. ...The jurisdiction of the High Court in dealing with a reference under Section 66 is a very limited one, It must take the facts as stated in the statement of the case unless the question whether the findings of the Tribunal are vitiated for one or the other of the reasons recognized by law is before it. It may be that the Income-tax Officer, the Appellate Assistant Commissioner as well as the Tribunal erred in holding that the income with which we are concerned in these appeals came from two different sources but then that question was foreign to the proceedings before the High Court."
10. In view of the observations made in the aforesaid decisions, we feel that for whatever reason if a party concedes a position before the Tribunal, it is not open to it to take a different stand, in a reference under the Income-tax Act. In such circumstances, it will not be possible to say that argument on such a submission arises out of the appellate order of the Tribunal. After conceding a position the party concerned cannot blame the Tribunal for deciding a case on its basis. We are accordingly of opinion that the question referred to us should be answered only on the basis that two of the objects mentioned in the trust deed were not objects of public charity and that it is unnecessary for us to go into the question whether in law they could be considered to be objects of public charity.
11. Once it is found that some of the objects of the trust are not of a public charitable nature and the trustees have a discretion in spending the amount over those objects, it cannot be said that the property held under trust is held wholly for religious and charitable purposes and the assessee would not be entitled to claim any benefit under Section 4(3)(i) of the Indian Income-tax Act, 1922. This point, in our opinion, stands concluded by the decision of the Supreme Court in [1967] 65 1TR 611 (East India. Industries (Madras) P. Ltd. v. Commissioner of Income-tax).
12. The argument that the two objectionable objects, viz., that for giving financial help or otherwise on the occasion of marriage of members of the Vaishya community ; and (2) social welfare and uplift in general of poor members of the Vaishya community, were merely subsidiary objects, does not appeal to us. A reading of the trust deed shows that the two objects do not depend upon any other object mentioned in the trust deed. It is open to the trustees to spend the trust income in connection with these objects ignoring the remaining objects. In the circumstances, they cannot be described as mere subsidiary objects. The petitioner, therefore, cannot derive any benefit from this line of argument.
13. The argument that since the preamble to Clause 3 of the trust deed shows that primarily the trust was being created for charitable purposes, even if some of the objects mentioned in the deed happened to be of non-charitable nature, the trustees could not spend any money on non-charitable objects, and such clauses would become innocuous and unenforceable, and the trust would still be a trust whose object is wholly public charity, does not appeal to us. The trust was created to serve such objects which the executants of the deed understood to be objects of public charity. They have enumerated all such objects in Clause 3(2) of the trust deed. Preamble of that sub-clause reads :
"To apply or spend out of the balance of such interest, dividend and income and if the trustees unanimously agree even out of the corpus of the trust fund any amount for the following objects and purposes and so that the decision of the trustees as to the objects of the trust or the beneficiaries shall be final and binding on all persons claiming under this trust and shall not be questioned in any court of law or otherwise howsoever."
14. This clearly shows that the executants of the deed specifically authorised the trustees to spend the trust funds in connection with various objects enumerated therein and which according to them were charitable objects. We do not see how the clauses which the executants thought really amounted to public charity, would become innocuous merely because it is found that in law they did not result in public charity. In our opinion the two clauses were neither rendered innocuous nor invalid merely because legally they did not result in public charity.
15. In the result we answer the question referred to us in the affirmative and against the assessee. The department will be entitled to receive its costs from the assessee which we assess at Rs. 200.