Section 12AA registration cannot be denied for missing dissolution clause when charitable objects and genuine activities are established.

ITAT Nagpur held that registration under section 12AA cannot be refused merely because a trust deed omits an express dissolution clause where the objects are charitable and the activities are genuine. The inquiry under section 12AA is limited to the charitable character of the objects and the genuineness of activities carried on in furtherance of those objects; on the facts, neither requirement was adversely found. The absence of a dissolution clause was treated as a technical defect, especially since the trust had submitted to the Charity Commissioner's jurisdiction and the Maharashtra Public Trust Act, 1950 addressed such contingencies. Registration was therefore to be granted.

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Issues: Whether registration under section 12AA could be refused merely because the trust deed did not contain a dissolution clause, when the objects were charitable and the activities were genuine.

Analysis: The satisfaction required under section 12AA is confined to the charitable nature of the objects and the genuineness of the activities carried on in furtherance of those objects. On the facts found, there was no adverse finding against either requirement. The absence of an express dissolution clause was held to be only a technical deficiency and not a valid ground for rejection, particularly where the trust had submitted to the jurisdiction of the Charity Commissioner and the Maharashtra Public Trust Act, 1950 contained provisions dealing with such contingencies. The later statutory insertion regarding tax treatment on dissolution also reinforced that the apprehension could not justify denial of registration.

Conclusion: Registration under section 12AA could not be refused on the ground of absence of a dissolution clause, and the assessee was entitled to registration.

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