TaxTMI 
TaxTMI 
2025 (3) TMI 351
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....rejecting the registration sought u/s 12A(1)(ac)(iii) of the Income Tax Act, which is illegal, erroneous and bad in law. 3. That the Ld. CIT Exemption has grossly erred in law in denying the registration without appreciating that the objects of the trust are charitable u/s 2(15) of the Income Tax Act, 1961. 4. That the Ld. CIT Exemption erred in law in holding that trust has no "dissolution clause" in trust deed although trustees had powers to dissolve the trust in the trust deed which meets such requirement. 5. That the Ld. CIT Exemption failed to appreciate that charity (i.e. Medical Relief and Education) to the families and children of ex-employees also amounts to charity to public. 6. That the appellant craves leave to add, amend, alter, change vary or substitute any of the aforesaid grounds or raise an additional ground if it becomes necessary to do so in the interest of justice. 7. That each ground of appeal is independent and without prejudice to other grounds of appeal raised herein." 3. Brief facts of the case are that, the Appellant filed an application in Form No. 10AB on 29/09/2022 seeking registration under Sub Clause (ii....
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....ecord. The Ld. CIT(E) rejected the application for registration filed by the Assessee on two Grounds (1) The activities carried out by the trust are restricted to its own employees, ex-employees and their family members, which shows that it is not a public charitable trust. (2) There is no dissolution clause in the trust deed, the net asset of the trust in case of dissolution can be transferred to any other entity. 7. For the purpose of adjudicating above controversy, the objects of the trust deed are to be verified. The Clause 4 of the trust deed deals with the object of the trust which reads as under: "4. The principal objective of Radisson India Charitable Foundation a. The Principal objective of Radisson India Charitable Foundation shall be Follows: b. promoting education directly or indirectly, including special education and employment enhancing vocation skills, promoting education directly or indirectly, including special education and employment enhancing vocation skills especially among children, women, elderly and the differently abled; C promoting livelihood enhancement projects, d. eradicating hunger, poverty, and malnutri....
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....ic as distinguished from a specified individual is present. This Court in Commissioner of Income tax, Madras v. Andhra Chamber of Commerce (1) overruled the view of Beaumont C.J. in Commissioner of Income tax v. Grain Merchants' Association of Bombay (2) on the point. It was, however, observed that the section of the community sought to be benefitted must be sufficiently defined and identifiable by some common quality of a public or impersonal nature. Where there was no common quality uniting the potential beneficiaries into a class the trust might not be regarded as valid. In the various orders the clause relating to the beneficiaries has not been clearly and accurately set out. In the petition of appeal dated October 7, 1968 the provisions of the constitution of the assessee are set out and with reference to The community it is stated, "Rana community means natives of Ahmedabad only and the other community brothers accepted by the community as per old rules of the community staying in Ahmedabad". It is common ground that the word " old rules" do not represent the correct translation of the original word in Gujarati which is Riwaj meaning custom. The learned judges of the High....
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....ed into that caste by consideration of their personal status as individuals. As a matter of fact the predominant content and requirement of the clause defining "beneficiaries" in the constitution of the assessee is the factum of their belonging to the Rana community of Ahmedabad. The common quality, therefore, uniting the potential beneficiaries into the class consists of being members of the Rana caste or community of Ahmedabad whether as natives or as being admitted to that caste or community under custom or usage. The mere fact that a person of the Rana community who is not an original native of Ahmedabad has to prove his credentials according to the custom and usage of that community to get admitted into that community cannot introduce a personal element. In Oppenheim v. Tobacco Securities Trust Co. Ltd. & Others(1) the trustees were directed to apply certain income in providing for the education of children of employees or "former employees" of a British limited company or any of its subsidiary or allied companies. It was held by the House of Lords by a majority that though the group of persons indicated was numerous, the nexus between them was employment by particular employe....
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....roviding the education and health care facilities to the children and the family members of Radisson Group Employees who expired due to Covid-19 pandemic. In our opinion, the family members of the deceased employees are part of 'public' and there is no relationship of employee and employer between the Appellant and the family members of deceased employees. Even otherwise, the ratio laid down by the Hon'ble Supreme Court in the case of Ahmedabad Rana Caste Association (supra) and Harilal Bhagwati Vs. CIT(2000) 246 ITR 188 are applicable to the case in hand. Thus, in our opinion, the Ld. CIT(E) committed error in holding that 'the activities of the appellant are restricted only to family members of the ex- employees, thus, the Assessee is not a 'public charitable Trust'. 11. Another reason for rejecting the registration is that there is no dissolution clause in the trust deed of the Assessee. We have gone through the trust deed, wherein in the Clause of 'power of trustees', it is mentioned as under: - "1. The Trustees shall have the following powers: (a) To start, abolish, discontinue, and restart any charity/charitable organization or institution for the ben....