JAISAV SAMITI,NEW DELHI vs. CIT(EXEMPTION), DELHI, DELHI

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘C’, NEW DELHI Before Sh. S. Rifaur Rahman, Accountant Member & Sh. Raj Kumar Chauhan, Judicial Member ITA No. 5602/Del/2026 : Asstt. Year: 2026-27 Jaisav Samiti, Vs CIT(Exemption), 13, LSC, J-Block, Veneue-21, Saket, Civic Centre, New Delhi-110017 New Delhi-110002 (APPELLANT) (RESPONDENT) PAN No. AAATJ3755H Assessee by: Sh. Nitin Kumar Rai, Adv. Revenue by: Sh. Vikram Singh Sharma, CIT-DR Date of Hearing: 25.06.2026 Date of Pronouncement: 18.09.2026 ORDER Per Raj Kumar Chauhan, Judicial Member: The appeal by the assessee is directed against the order dated 13.03.2026 of ld. CIT(Exemptions), Delhi wherein the application filed in Form 10AB for grant of registration u/s 12AB(1)(ac)(ii) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) was rejected on the ground that the applicant has failed to remove the deficiency of absence of dissolution clause in the trust deed of incorporation despite ample opportunity afforded.

2 ITA No. 5602/Del/2026 Jaisav Samiti section 12AB(1)(b)(ii)(B) of the Income-tax Act, 1961 (“the Act”) rejecting the application for registration in Form No. 10AB is illegal, arbitrary, bad in law and contrary to the facts and circumstances of the case. 2. That the Ld. CIT(E) erred in rejecting the application for registration under section 12AB solely on the ground that the Trust Deed/Memorandum of Association does not contain a dissolution clause, without appreciating that the Income-tax Act, 1961 does not prescribe existence of such clause as a mandatory condition for grant of registration under section 12AB of the Act. 3. That the Ld. CIT(E) failed to appreciate that the scope of enquiry under section 12AB of the Act is limited to examination of the objects of the trust/institution and genuineness of its activities, both of which were duly established by the Appellant and were never adversely doubted by the Ld. CIT(E). 4. That the Ld. CIT(E) failed to appreciate that the Appellant trust, constituted on 23.07.1969, has been carrying on genuine charitable activities for several decades in accordance with its stated objects of relief of the poor, medical relief and advancement of other objects of general public utility, and had also been granted registration under section 12A/12AB of the Act from time to time, including registration under section 12A(1)(ac)(i) vide order dated 02.10.2021 for Assessment Years 2022-23 to 2026-27, and since there was no change in the objects or activities of the Appellant, rejection of registration was wholly unjustified and contrary to law. 5. That the Ld. CIT(E) erred in importing conditions and requirements which are not contemplated under the provisions of section 12A/12AB of the Act and thereby exceeded the jurisdiction vested under law. 6. That the reliance placed by the Ld. CIT(E) upon the doctrine of cy-pres and judicial observations relating to public trust property is misconceived, misplaced and irrelevant for the purpose of adjudicating an application for registration under section 12AB of the Act. 7. That the Appellant craves leave to add, alter, amend or withdraw any of the above grounds of appeal at or before the time of hearing.” 3. We have heard the ld. AR and the ld. DR. The ld. AR at the very outset would submit that the impugned order has been

3 ITA No. 5602/Del/2026 Jaisav Samiti passed illegally and the registration has been denied solely on the ground that the trust deed does not have a dissolution clause. It is further argued that the Income Tax Act does not prescribe existence of such clause as mandatory condition for grant of registration u/s 12AB of the Act. Thirdly, the ld. CIT(E) failed to appreciate that the appellant trust constituted on 23.07.1969 has been carrying on genuine charitable activities for decades and since there was no change in the objects or activities of the appellant, rejection of registration was unjustified and contrary to law because the appellant was granted registration on 02.10.2021 for A.Y. 2022-23 to 2026- 27 and there is no change at all in its activity, objects and income etc. Fourthly, insisting on dissolution clause is contrary to the scheme of section 12AB and is beyond the scope of inquiry contemplated under the Act for granting registration u/s 12AB of the Act. Fifthly, neither section 12A nor section 12AB of the Act prescribes the existence of a dissolution clause as a mandatory pre-condition for grant or continuation of registration and the only requirement u/s 12AB is confined to examination of:

(i) the object of the trust or institution, (ii) the genuineness of its activities.

4 ITA No. 5602/Del/2026 Jaisav Samiti 4. It is therefore argued that the impugned order has been passed in violation of the settled legal principle and legal precedents and is liable to be set aside and the application for registration should be allowed. In support of his above submissions and the written arguments, the ld. counsel has relied upon the following case law:

“31. Mr. Pardiwalla is also right when he contends that the conditions for grant of registration remain the same both under sections 12AA and 12AB of the Act. When considering the same Trust Deed, registration was granted both under section 12AA and section 12AB(1)(a) of the Act (new regime as well), there is no reason forthcoming to take a different stand when an application is made for renewal of registration. It may be pertinent to note that there are various trusts who are more than 20-30 years old and some also 50 years old. They were, with the same Trust Deed and same set of activities, granted registration earlier. There is no logic, when the conditions for renewal remain the same in section 12AB as compared to the earlier provisions i.e. , section 12AA, then, why different criteria are applied today to deny registration. On this ground of the Petitioner as raised in the petition, nothing has been commented in the reply affidavit. However, in his argument, Mr. Gupta contended that there is no estoppel in law. Such an argument cannot be countenanced. There being no change in the requirements for grant of registration, a completely new condition cannot be invoked to put at naught the entire provisions dealing with grant of exemption to charitable trusts at the threshold by denying registration, leave aside the grant of exemption. This is also one of the reasons to interfere with the orders passed by Respondent No. 1. ................. 46. In the result, the Writ Petition is allowed. Due to the peculiar facts, as presented by the Petitioners, we pass the following order:

5 ITA No. 5602/Del/2026 Jaisav Samiti

(i) The Respondents shall refrain from rejecting applications for registration/renewal under section 12AB solely on the ground of the absence of an explicit irrevocability and/or dissolution clause in the Trust Deed/instrument.” 2. Radisson India Charitable Foundation Vs. ITO(Exemption) in ITA Nos. 3976 & 3978/Del/2024, order dated 22.01.2025 where identical issue has been decided in favour of the assessee/appellant by directing the ld. CIT(E) to grant registration u/s 12AB of the Act. Para 11 to 14 are relevant and extracted below as under:

“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 benefit of the general public and impose conditions to its subscription or donations made therein. (h) To transfer and hand over the Trust to any other trust/society/association/institution on such terms and conditions as the Trustees shall in their absolute discretion think fit and proper.” 12. From the plain reading of the above Clauses, though the trustees have power to transfer and hand over the trust to any other trust/society/Association/Institution, is no mentioning regarding the dissolution of the trust and the fate of net asset of the trust in case of dissolution. It is true that the net asset of the trust can be transferred to any entity since, as per the above Clause in the trust deed, the trustees have absolute right to transfer and hand over the Trust to any other trust/society/association/institution on such terms and conditions as the Trustees shall in their absolute discretion think fit and proper.

6 ITA No. 5602/Del/2026 Jaisav Samiti However, after the amendment to provision of Section 115TD of the Act, which has been inserted by Finance Act, 2016 w.e.f. 01/06/2016, the relevance of having dissolution clause and the apprehension on the transfer of net asset to any other entity has been taken care by the said provisions of Section 115TD of the Act. Thus, in our considered opinion, the absence of dissolution clause and non-mentioning of fate of net asset in the trust deed cannot be a ground to deny the registration u/s 12AB of the Act. Thus, the Ld. CIT(E) committed error in rejecting the registration u/s 12A and 80G of the Act. 13. In view of the above discussion, we find merit in the Grounds of appeal of the Assessee, accordingly, we allow the Grounds of appeal of the Assessee and set aside the impugned orders of the Ld. CIT(E) dated 12 ITA Nos. 3976 and 3978/Del/2024 Radisson India Charitable Foundation 02/07/2024 and direct the Ld. CIT(E) grant registration u/s 12AB of the Act, consequently, also grant Registration u/s 80G of the Act. 14. In the result, Appeals of the Assessee in ITA No. 3976/Del/2024 and 3978/Del/2024 are allowed.” 5. The ld. DR on the other hand would submit that the judgment of the Hon’ble Bombay High Court cannot be relied and applicable to the case of the assessee because in Mumbai there is Bombay Trust Act separately dealing with the trust and there is no such Delhi Trust Act. However, with respect to the decision of the jurisdictional Tribunal in Radisson India Charitable Foundation (supra) nothing has been submitted by the ld. DR.

7 ITA No. 5602/Del/2026 Jaisav Samiti of the jurisdictional Tribunal especially contained in para 12, 13 & 14 in ITA No. 3976 & 3978/Del/2024 (supra), we are of the considered opinion that the facts are identical to the case of jurisdictional Tribunal vis-à-vis the case in hand, therefore we are not convinced by the arguments of the ld. DR with respect to the non-application of the judgment of the Hon'ble Bombay High Court, wherein Hon'ble High Court has categorically held that the respondents shall refrain from rejecting applications for registration/renewal under section 12AB solely on the ground of the absence of an explicit irrevocability and/or dissolution clause in the trust deed/instrument.

8 ITA No. 5602/Del/2026 Jaisav Samiti 8. In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on 18/09/2026. Sd/- Sd/- (S. Rifaur Rahman) (Raj Kumar Chauhan) Accountant Member Judicial Member Dated: 18/09/2026 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR