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Facts
The assessee trust filed applications for registration under section 12AB and approval under section 80G of the Income Tax Act. The CIT(E) rejected both applications, citing that the trust deed/MOA had objects which allowed for the application of funds outside India and that the assessee failed to fulfil criteria for section 80G approval due to rejection of the 12AB registration.
Held
The Tribunal found that the assessee had amended its MOA to restrict activities within India. Citing a similar case, the Tribunal restored the application for registration under section 12AB to the CIT(E) for de novo adjudication with a direction to consider the amended objects. The rejection of the 80G application was consequential and also set aside.
Key Issues
Whether the assessee's application for registration under Section 12AB and approval under Section 80G should be granted, especially in light of amendments made to its objects clause.
Sections Cited
12AB, 80G, 12A(1)(ac), 11, 12, 23AA, 23C, 10
AI-generated summary — verify with the full judgment below
Before: JUSTICE (RETD.) C. V. BHADANG & SHRI PRABHASH SHANKAR & Dr.
Date of Hearing 11.11.2025 Date of Pronouncement 21.11.2025 आदेश / O R D E R PER PRABHASH SHANKAR [A.M.] :- The above captioned appeals have been filed by the assessee Trust against the orders passed by the Learned Commissioner of Income- tax(Exemptions), Mumbai[hereinafter referred to as “CIT(E)”] pertaining to the orders passed u/s. section 12AB and 80G of the Income-tax Act, 1961 [hereinafter referred to as “Act”]. Since the issues are inter-connected and also the fact that these appeals were heard together, they are being taken & 5643/Mum/2025 Gauri Jatia Foundation, Mumbai up together for adjudication vide this composite order for the sake of brevity. We take up first.
The grounds of the appeals are as under:
1. 1. On the facts and circumstances of the case and in law, the LD. CIT Exemption in rejecting the Application u/s 12A(1)(ac)(vi)(B)seeking registration under section 12AB of the Act of the Income Tax Act.
2. The appellant humbly prays that Ld. CIT Exemption may please be directed to grant registration u/s 12A(1)(ac)(vi)(B) seeking registration under section 12AB of the Act of the Income Tax Act and relief may please be granted.
Both the above grounds pertain to the rejection of application for registration u/s 12A(1)(ac)(vi)(B) of the Act by the ld.CIT(E). The assessee filed application for registration in Form No.10AB under clause
(iii) of section 12A(1)(ac) of the Act. On verification of the application in Form 10AB filed by the applicant, it was found by him from the trust deed/MOA that point no. 3(b)(23) of the objects were in violation of provisions of section 11 of the Act as the trust intended to apply/receive funds outside India. In response to query in this regard, the applicant submitted that the objects of the company extended to whole of India and thus the objects of the company were limited to extend to whole of India only and not outside India and thus no funds are to be applied outside India. However, the reply was rejected with the observations & 5643/Mum/2025 Gauri Jatia Foundation, Mumbai that the following objects, as stated in the trust deed/MOA are in violation of statutory provisions, as reproduced below:-
“3(b)(23): To do all or any of the objects set out herein for attaining the main objects of the Company in India or elsewhere....
He further observed that the use of such words above referred objects in the MOA/trust deed clearly conveyed its intention to utilise fund outside India, thereby leaving open the possibility for future endeavours, which may involve expenditure outside the country. The applicant trust ought to have amended the clauses of the objects mentioned above which are in violation of the Act as discussed above, however, the applicant had not considered it. Since registration under section 12AB is to be granted in terms of the provisions of section 12AB(1)(b) of the Act after being satisfied about the objects of the trust or institution, the genuineness of activities, and the compliance of any other law for the time being in force as are material for the purposes of achieving its objects. In view of these violations, he rejected the application seeking registration under section 12AB of the Act.
In this regard, in the course of hearing before us, the ld.AR has submitted that the applicant trust did not intend to carry out its activities outside India but in the whole of India. He also informed that the Trust has moved to the