Section 12A and 80G Registration Restored for Overseas Scholarship Society: Key Takeaways from ITAT Delhi

Background and Context

The decision in Oxford and Cambridge Society of India Vs CIT (Exemption) (ITAT Delhi) deals with a recurring controversy: whether an Indian charitable organization that grants scholarships to Indian students for pursuing education abroad can be denied registration under Section 12A / Section 12AB and Section 80G on the ground that its income is “applied outside India” in violation of Section 11(1)(c).

The assessee in this case is Oxford and Cambridge Society of India (OCSI), a society formed in 1982 by alumni of Oxford and Cambridge Universities. Its main charitable activity is awarding merit-based scholarships to Indian students who go on to pursue postgraduate courses at Oxford or Cambridge.

The CIT(E), Delhi, by two separate orders dated 27.03.2026, rejected:

  • The assessee’s application for regular registration under Section 12AB, and
  • The assessee’s application for approval under Section 80G(5)

The Income Tax Appellate Tribunal, Delhi Bench, was called upon to examine whether this rejection was legally sustainable.

Facts in Brief

Assessee’s profile and activities

  • The assessee is a society registered since 1982, comprising India-based alumni of Oxford and Cambridge.
  • Its key charitable activity consists of:
    • Awarding merit scholarships to Indian students who have secured admission for postgraduate study at Oxford or Cambridge.
    • Encouraging fellowship, networking and intellectual interaction among alumni in India.
  • Scholarships are awarded after a selection process conducted in India. The amount is paid in Indian currency to the selected students or, where relevant, to their parents or guardians through Indian bank accounts.

Orders of the CIT(E)

The Section 12AB registration application (leading to ITA 5165) and the Section 80G(5) approval application (leading to ITA 5166) were both decided adversely by the CIT(E) on the same date.

The CIT(E) recorded multiple adverse findings, which can be grouped as follows:

  1. Alleged violation of Section 11(1)(c)

    • According to the CIT(E), although funds were paid to Indian students, the actual use was for studies in the UK.
    • He treated this as an “application of income outside India”, attracting the prohibition in Section 11(1)(c) and therefore held that the assessee’s activities did not qualify for exemption.

  2. Doubts on scholarship selection criteria

    • The CIT(E) observed that scholarships were not exclusively based on financial hardship and appeared to be focused largely on merit.
    • He insinuated that, without a clear financial-need-based filter, the charitable nature of the activity was questionable.

  3. Alleged opacity in selection process

    • The CIT(E) stated that the selection process was not transparent enough and that the assessee did not provide selection procedure details “to the extent desirable”.

  4. Lack of post-scholarship follow-up

    • The CIT(E) criticized the assessee for not having a structured system of tracking or engaging with scholarship recipients after completion of their courses abroad.
    • He regarded this as a negative factor in assessing genuineness of activities.