Is it always required to derive a class that has member which needs to dynamically allocated from CBase

" "Is it always required to derive a class that has member which needs to dynamically allocated from CBase"?"

The English isn't quite clear in your question, what was your doubt about the member part of your question?

In your example code, CXMLElement contains a data member that allocates memory ElementName (which should be called iElementName to follow naming conventions). If you have a class which allocates memory then that class must derive from CBase, so CXMLElement must derive from CBase.

CBase classes has two advantages:
1- it has a virtual distructor
Advantage: In this case when there is a derived class of CXMLElement then objects will be cleaned properly (Base class objects will be cleaned properly)
2- It has a separate "new" function which allocates & initializes all data member to NULL.
Advantage:
Suppose your class is not derived from CBase then:
class CXMLElement
{
HBufC8* ElementName;
public:
static CXMLElement* NewL()
{
CXMLElement*self = new (ELeave) CXMLElement( );
CleanupStack::PushL( self );
self->ConstructL();
CleanupStack::Pop();
return self;
}

static CXMLElement* NewLC();
~CXMLElement()
{
delete ElementName;
}

private:

void ConstructL()
{
HBufC8* ElementName = HBufC8::NewL(100);
/// some other processing which might leave......
}

};

Now lets suppose there is a Leave in ConstructL then ~CXMLElement() will NOT be called since it is not Derived from CBase. only cells wiill be deleted for CXMLElement object. so now there is a memory Leak of ElementName.

And since CBase initializes class data member to NULL. there is no chance of deleting a Garbage location. This might happen in partially constructed object.

In short CBase does few hacks that we might forget to do, so its better to derive classes from it (where there is some dynamic allocation)

Please correct me if i am wrong.

Talking about it having advantages and saying "so its better to derive classes from it " you make it sound like you have a choice, you don't - you must derive from CBase in the situations mentioned if you want to follow the conventions and standards.