TaxTMI 
TaxTMI 
2026 (5) TMI 1404
X X X X Extracts X X X X
X X X X Extracts X X X X
....(ac)(iii) of the Income Tax Act, 1961 [hereinafter referred to as 'the Act'] and the application in Form 10AB for seeking approval u/s. 80G of the Act. The approval for registration u/s. 12A(1)(ac)(iii) of the Act was rejected by the Ld CIT (E) on the ground the applicant trust deed of the assessee trust did not contain 'Irrevocable' clause. Consequent, to this rejection, the approval u/s. 80G of the Act was also rejected by the Ld CIT (E). The relevant extracts of the order of the Ld. CIT(E) rejecting the registration u/s. 12A(1)(ac)(iii) of the Act is reproduced as under: "Order under u/s. 12AB(1)(b)(ii)(B) of Income Tax Act, 1961 The applicant has filed an application dated 03.04.2025 in Form 10AB for registration u/s. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 2. The applicant trust deed doesn't contain DISSOLUTION Clause The absence of dissolution clause results in failure to ensure that the income and property of the trust shall be utilized solely for charitable purposes, as required under the provisions of Section 12A read with section 12AB of Income Tax Act, 1961.It is pertinent to mention here the Doctrine of Cy-Près: The Guiding Principle of 09 Dissolution This doctrine ensures that property once dedicated to charity remains in the charitable domain in perpetuity. The Supreme Court's articulation of the Public Trust Doctrine in environmental law provides a powerful parallel. In Intellectuals Forum, Tirupathi v. State Of A.P And Others (AIR 2006 SC 1350), the Hon'ble S....
X X X X Extracts X X X X
X X X X Extracts X X X X
....se in not allowing the permanent registration u/s. 12A(1)(ac)(iii). 2 That ld CIT(E) without appreciating the correct facts of the case and without giving proper opportunity of being heard and issuing any show cause notice is not justified in law and facts and circumstances of the case in cancelling the provisional registration with retrospective effect which was granted earlier vide order dated 30/11/20222 having Unique Registration No. AAATS 4033ME20221 for the period from AY 2023-24 to AY 2025-26." 3. The Ld. AR of the assessee filed a written submission in support of its grounds of appeal. The relevant extract of the same is reproduced as under: "The above two appeals filed by the appellant assessee are fixed for he....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Hon'ble High Court of Allahabad in the case of Commissioner of Income-tax (Exemption) vs. Reham Foundation LKO [2019] 111 taxman.com 379 (Allahabad), to submit that if the Tribunal is satisfied with the conditions attached to the grant of registration to the assessee trust u/s. 12A of the Act, then the Tribunal could direct registration of Trust without remanding the matter to the Ld. CIT(E). 4. On the other hand, the ld. CIT(DR) supported the order of the Ld. CIT(E), but fairly submitted that this issue may be restored to the file of the Ld. CIT(E) for necessary verification and passing of fresh order in accordance with law. In this regard, the Ld. CIT(DR) also relied upon the order dated 12th February, 2026 of the Hon'ble Delhi High Co....
X X X X Extracts X X X X
X X X X Extracts X X X X
....med by the Settlor that the Trust constituted under the Principal Deed is and shall remain irrevocable in all respects. 2. That the Settlor hereby unequivocally undertakes and covenants that neither the Settlor nor any person claiming through him/her shall revoke, rescind, amend, or alter the said Trust or its provisions at any time in future. 3. That the Trust shall continue to function, operate, and subsist in accordance with the terms, powers, and conditions embodied in the Principal Deed, subject always to the laws in force, and shall be binding on the Settlor, the Trustees, and their respective successors. 4. That this Supplementary Deed is executed only to incorporate the irrevocability of the Trust, and sav....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e application of the assessee. Therefore, the facts are distinguishable in the present case and therefore, the decision relied upon by the assessee will not be applicable in the given facts of the case of the assessee. 5.2 Therefore, in view of the fact, that the assessee has incorporated the 'Irrevocable' clause in the trust deed, the matter is set aside to the file of the CIT(E) to consider the registration of the assessee, in view of the incorporation of the above clause after necessary verification and pass necessary order for registration u/s. 12A(1)(ac)(iii) of the Act preferably within a period of 60 days after the receipt of this order and in accordance with law. 6. In the result, appeal of the assessee is allowed for statisti....