SURAJ DEVI CHARITABLE TRUST,PUNE vs. WARD EXEMP 2(2), DELHI, NEW DELHI

ITA 6151/DEL/2026Status: DisposedITAT Delhi29 September 2026AY 2026-277 pages
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What did the Tribunal hold?

The Tribunal held that the absence of an explicit irrevocability clause in the trust deed is not a valid ground for rejecting an application for registration under Section 12AB of the Income Tax Act. The Tribunal followed the precedent set by the Bombay High Court in Chamber of Tax Consultants vs. CIT(E), which held that public charitable trusts are deemed irrevocable by operation of law unless the instrument expressly provides for revocation. The Tribunal also noted that the absence of a dissolution clause is not a ground for denial of registration, citing the ITAT Delhi Bench decision in Radisson India Charitable Foundation vs. ITO, Exemption, which highlighted that Section 115TD of the Act addresses concerns regarding the transfer of net assets upon dissolution. Consequently, the CIT(E)'s order rejecting the Section 12A(1)(ac)(ii) registration was quashed. As a consequential relief, the Tribunal also quashed the CIT(E)'s order rejecting the Section 80G approval, directing the CIT(E) to grant both registrations/approvals in accordance with law. The Tribunal emphasized that charitable trusts contributing to nation-building should be treated with a fair and reasonable approach by the revenue.

What were the facts?

The assessee, Suraj Devi Charitable Trust, filed applications for registration under Section 12AB(1)(ac)(ii) and approval under Section 80G of the Income Tax Act, 1961, for Assessment Year 2026-27. The Commissioner of Income Tax (Exemptions) [CIT(E)], Delhi, rejected both applications. The primary reason for rejection was the absence of an irrevocable and dissolution clause in the trust deed. The assessee had provided audited financials for FY 2024-25 and proof of prior registration, but the CIT(E) insisted on the irrevocability clause. The assessee argued that the absence of such a clause should not be a ground for rejection, citing legal precedents. Aggrieved, the assessee filed appeals before the Income Tax Appellate Tribunal (ITAT), Delhi Bench.

What were the issues?

1. Whether the absence of an irrevocable clause in the trust deed is a valid ground for rejecting an application for registration under Section 12A(1)(ac)(ii) of the Income Tax Act, 1961, as per Section 12AB(1)(ac)(ii)? - Assessee's contention: The absence of an explicit irrevocability clause is not a statutory requirement for registration and should not lead to rejection. The trust deed's nature, coupled with legal provisions, implies irrevocability. Reliance was placed on the Bombay High Court's decision in Chamber of Tax Consultants vs. CIT(E). - Revenue's contention: The Ld. CIT(E) relied on the absence of the clause as stated in the impugned order. 2. Whether the absence of a dissolution clause in the trust deed is a valid ground for rejecting an application for registration under Section 12A(1)(ac)(ii) of the Income Tax Act, 1961, as per Section 12AB(1)(ac)(ii)? - Assessee's contention: Similar to the irrevocability clause, the absence of a dissolution clause should not be a ground for rejection, especially considering Section 115TD of the Act. Reliance was placed on the ITAT Delhi Bench's decision in Radisson India Charitable Foundation vs. ITO, Exemption. - Revenue's contention: The Ld. CIT(E) rejected the application based on the absence of this clause. 3. Whether the rejection of the application for registration under Section 12A(1)(ac)(ii) warrants the consequential rejection of the application for approval under Section 80G(5)(ii) of the Income Tax Act, 1961? - Assessee's contention: If the Section 12A registration is granted, the Section 80G approval should also be granted. - Revenue's contention: The Ld. CIT(E) rejected the Section 80G approval as a consequence of rejecting the Section 12A registration.

Which sections of the Income-tax Act were involved?

Section 12AB(1)(ac)(ii),Section 80G,Section 12A,Section 115TD

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “F”: NEW DELHI

Before: SHRI M. BALAGANESH, HON’BLE ACOUNTANT MEMBER & SHRI SUDHIR KUMAR, HON’BLE JUDICIALMEMBER &

For Appellant: Adv. & Sh. Ayush Kumar
Hearing: 24/09/2026Pronounced: 29/09/2026

PER SUDHIR KUMAR, JM: These appeals by the assessee are directed against the respective orders both dated 12.03.2026 of the Ld. Commissioner of Income Tax (Exemption), Delhi [hereinafter referred to as “CIT(E)”] passed u/s. 12AB(1)(ac)(ii) and u/s. 80G of the Income Tax Act, 1961 (hereinafter referred as Act). Since the issues involved in these appeals are inter- connected, hence, the same were heard together and disposed of by this common order for the sake of convenience, by dealing with ITA No. 6151/Del/2026 being the lead case.

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