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Facts
The assessee, Lakshmi Charitable Trust, applied for registration under section 12A(1)(ac)(iii) and approval under section 80G(5) of the Income Tax Act, 1961. The CIT(E) rejected these applications because the trust deed did not contain a dissolution clause. The assessee subsequently amended the trust deed to include the necessary dissolution clause and submitted it before the Tribunal.
Held
The Tribunal acknowledged that the assessee had cured the defect by amending the trust deed. Both appeals were remanded back to the CIT(E) for fresh consideration of the applications for registration and approval, taking into account the amended trust deed. The assessee was directed to cooperate and provide all necessary documentary evidence during the fresh proceedings.
Key Issues
Rejection of application for trust registration due to absence of a dissolution clause; Rejection of application for approval under Section 80G(5).
Sections Cited
12A(1)(ac)(iii), 80G(5), 12A(1)(a)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, AMRITSAR BENCH, AMRITSAR.
Before: DR. M. L. MEENA & SH. UDAYAN DASGUPTA
ORDER Per: Bench.: This appeal is filed by the assessee against the order of ld. CIT (E), rejecting the application for registration u/s 12A(1)(ac)(iii) of the Act 1961, vide order dated 03.12.2024.
& 08/Asr/2025 2 Assessment Year: 2025-26 I.T.A. No. 07/Asr/2025
There are five grounds taken by the assessee and the main objection of the assessee is that the ld. CIT(E) has not allowed proper opportunity of hearing before rejecting the application for registration on the ground that the trust deed does not contain a dissolution clause which makes it difficult to ascertain the distribution of assets if the trust were to be dissolved or ceased to exists.
The ld. AR of the assessee in course of hearing submitted that the deed of trust has been amended and the necessary clause regarding the issue raised by the ld. CIT(E) has been cured and the supplementary deed of trust executed on 1st day of June 2025 contained the necessary dissolution clause and he has filed a copy of the amended trust deed before the Tribunal. He prayed for remand of the matter back to the files of the ld. CIT(E) to consider the application afresh in consultation with the amended trust deed which includes the necessary dissolution clause.
The ld. DR has no objection if the matter is remanded back to the file of the ld. CIT(E) for proper consideration of the deed of trust.
& 08/Asr/2025 3 Assessment Year: 2025-26
We have heard the rival submissions and considered the materials on record and we remand the issue back to the ld. CIT(E) to consider the application for registration afresh after taking into consideration the amended trust deed which contains the necessary dissolution clause. We also find that the ld. CIT(E) has raised an issue regarding the registration of the trust to which the ld. AR of the assessee submitted that the said trust is also registered under the State Public Trust Act under the laws of the State. 5.1 We also direct the assessee to file all necessary documentary evidences before the ld. CIT(E) for proper disposal of the registration and to fully cooperate in the fresh proceedings. 5.2 As such, the appeal of the assessee is allowed for statistical purposes.
6. This appeal is against the order of the ld. CIT(E), Chandigarh against the rejection of the application for approval u/s 80G(5) of the Act 1961. 7. Since, we have remanded the matter regarding the application for registration u/s 12A(1)(a) back to the file of the ld. CIT(E), we also remanded this matter for approval back to the file of the ld. CIT(E) for disposal of the same in tandem alongwith the registration application.
& 08/Asr/2025 4 Assessment Year: 2025-26
In the result, both the appeals of the assessee are allowed for statistical purposes.