RCPC WELFARE TRUST,SECTOR-3 ROHINI vs. CIT(EXEMPTION), DELHI, DELHI

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ITA 5699/DEL/2026Status: DisposedITAT Delhi22 June 20264 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that irrevocability and dissolution clauses are necessary for registration under Section 12AB and approval under Section 80G. The matter was restored to the CIT(Exemptions) for fresh consideration after the assessee incorporates these clauses.

What were the facts?

The assessee trust applied for registration under Section 12A(1)(ac)(ii) and approval under Section 80G(5)(ii). The CIT(Exemptions) rejected both applications because the trust deed lacked an explicit dissolution clause.

What were the issues?

Whether the absence of an explicit dissolution clause in the trust deed warrants rejection of registration under Section 12A/12AB and approval under Section 80G.

Which sections of the Income-tax Act were involved?

Section 12A(1)(ac)(ii),Section 80G(5)(ii),Section 12AB

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘C’, NEW DELHI

Before: Sh. S. Rifaur Rahman & Sh. Raj Kumar Chauhan

For Appellant: CA &, Ms. Himani Garg, CA
Hearing: 22.06.2026Pronounced: 22.06.2026

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. 5698/Del/2026 ITA No. 5699/Del/2026 RCPC Welfare Trust, Vs CIT(Exemptions), B-381, Vardhman Grand Plaza, New Delhi-110002 Sector-3, Rohini, New Delhi-110085 (APPELLANT) (RESPONDENT) PAN No. AACTR6188G Assessee by: Sh. Pawan Chhikara, CA & Ms. Himani Garg, CA Revenue by: Sh. Vikram Singh Sharma, CIT-DR Date of Hearing: 22.06.2026 Date of Pronouncement: 22.06.2026 ORDER Per Raj Kumar Chauhan, Judicial Member: The appeals of the assessee are directed against order dated 24.03.2026 of the Ld. CIT(Exemption), Delhi, wherein the application for registration u/s 12A(1)(ac)(ii) of the Act of the applicant trust as well as approval u/s 80G(5)(ii) of the Act were rejected and denied, respectively. On the ground that the applicant trust has not incorporated in the trust deed the necessary explicit dissolution clause, the applicant trust has even failed to file the supplementary trust deed by incorporating the dissolution clause in the trust deed. However, the applicant trust was given liberty to file a fresh application

2 ITA Nos. 5698 & 5699/Del/2026 RCPC Welfare Trust

u/s 12AB after removal of the deficiencies as pointed out during the hearing.

3.

Aggrieved by the impugned order of rejection of registration u/s 12AB and approval u/s 80G of the Act, the applicant trust has filed appeal before us.

4.

We have heard the ld. AR and the ld. DR. The ld. AR at the very outset submitted that the registration u/s 12AB and approval u/s 80G has been denied arbitrarily as there is no mandatory requirement of explicit dissolution clause in the trust deed. Hence, it is submitted that either the Tribunal may direct the ld. CIT(E) to grant approval alongwith registration as requested or may restore the matter to the ld. CIT(E) with the required direction.

5.

The ld. DR on the other hand while supporting the judgment of the ld. CIT(E) has left it to the discretion of the court to restore the matter to the ld. CIT(E) for deciding afresh however, after compliance by the applicant trust with regard to the incorporation of dissolution clause in the trust deed.

6.

We have considered the rival submissions and examined the impugned order. The ld. CIT(E) has passed a very detailed order with regard to necessity of irrevocable clause as well as dissolution clause to be incorporated trust deed. The ld. CIT(E)

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has categorically discussed the mandatory legislative requirement of Section 60 to 63 of the Act alongwith Section 92 of the CPC and applicability of doctrine of Cy-pres in a case where charitable trust deed is missing the irrevocable and dissolution clause. Moreover, ld. CIT(E) has already granted liberty for fresh application u/s 12A after removal of the aforesaid deficiency.

7.

In view of the above discussion, we are of the considered opinion that the irrevocability and dissolution clause are the necessity for a charitable trust to be registered u/s 12AB(1)(ac)(ii) and also for approval u/s 80G of the Act. Both the appeals are restored to ld. CIT(E) for deciding the same afresh after affording an effective opportunity of hearing to the assessee who shall comply the necessary requirement as noted above which are necessary for granting registration u/s 12A and approval u/s 80G of the Act. The assessee shall make the necessary incorporation for containing the irrevocability and dissolution clause in the trust deed and shall place the same before ld. CIT(E) within a period of 60 days who shall decide the question of approval and registration expeditiously.

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8.

Both the appeals of the assessee are allowed for statistical purposes. Order Pronounced in the Open Court on 22/06/2026. Sd/- Sd/- (S. Rifaur Rahman) (Raj Kumar Chauhan) Accountant Member Judicial Member Dated: 22/06/2026 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR

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