2014 (7) TMI 869

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....n duly constituted under the Deed of Trust dtd. 15-05-2008 and registered with the Charity Commissioner Mumbai on 8-10-2008 u/s 18 of the Bombay Public Trusts Act, 1950. It filed an application with the Director of Income Tax (Exemptions) for registration u/s 12A of the Act in the prescribed Form No. 10A on 27-06-2012. From the perusal of the Trust Deed of the assessee, it was noticed by the DIT (exemptions) that the same did not contain "dissolution clause" to the effect that Trust is irrevocable and that if for some reason its objects cannot be carried out, then as per the provisions of the Bombay Public Trusts Act, 1950, its net assets will be given to another Trust having similar objects and under no circumstances, these will be distrib....

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....ting the dissolution clause in its Trust Deed. As per the Bombay Public Trusts Act, 1950 and the settled position of law, a trust is a perpetual trust. The essence of a trust for public charitable or religious purpose lies in its characteristic of permanency. In case the objects! activities of the trust cannot be carried out and it has to be dissolved, its corpus and properties etc. remaining on the date of dissolution have to be transferred to another trust having similar objects with the sanction of the Charity Commissioner as per the procedure laid down under the Bombay Public Trusts Act, 1950. No such clause is found to be there in the Trust Deed and, therefore, the applicant cannot be said to have been constituted as a valid public cha....