Bombay HC Upholds Tax Exemption on Anonymous Donations to Shirdi Sai Baba Trust

The Bombay High Court has upheld the tax exemption on anonymous donations received by the Shree Sai Baba Sansthan Trust, Shirdi. The court confirmed that the Trust qualifies as a religious and charitable organization, making it eligible for tax exemptions on such contributions. The Trust received total donations of ?228 crores in the assessment year 2015-16, out of which ?159 crores were anonymous. The Assessing Officer had taxed these donations, asserting that the Shirdi Trust fell under Section 80G of the Income Tax Act, which grants deductions to charitable institutions but excludes religious trusts from certain exemptions under Section 115BBC (1). The High Court rejected the appeal by the Income Tax Commissioner (Exemptions), Mumbai, and upheld the Income Tax Appellate Tribunal’s decision. The ruling clarifies that a trust can serve both religious and charitable purposes, and determining its nature requires examining the trust deed and bylaws.