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Issues Involved:
1. Exclusion of repairs and insurance expenses on motor car for aggregation under section 37(3A). 2. Deduction under section 35(2A) for donation to a charitable trust. Detailed Analysis: Issue 1: Exclusion of Repairs and Insurance Expenses on Motor Car The revenue contended that the learned CIT(A) erred in excluding repairs and insurance expenses on the motor car amounting to Rs. 21,233 for aggregation under section 37(3A). The tribunal noted that the assessee's case is covered by the jurisdictional High Court decision in CIT v. Chase Bright Steel Ltd. (No. 1) [1989] 177 ITR 124 (Bom.), and hence, no interference was warranted. Thus, this ground was rejected. Issue 2: Deduction under Section 35(2A) for Donation to Charitable Trust The assessee made a donation of Rs. 8,00,000 to Swastiyog Pratisthan Charitable Trust for a Scientific Research Programme approved under section 35(2A). The Assessing Officer disallowed the claim for weighted deduction under section 35(2A) because, at the time of donation, the trust's recognition under section 35(1)(ii) had lapsed. The Departmental Representative argued that for a weighted deduction of 133 1/3 percent under section 35(2A), the donee must have recognition under section 35(1)(ii) at the time of donation. He emphasized that the recognition under section 35(1)(ii) is a pre-condition for claiming the deduction under section 35(2A). Conversely, the assessee's counsel argued that the mention of "referred to in clause (ii) of sub-section (1)" in section 35(2A) is merely indicative and not a pre-condition. He suggested that the term "or" in section 35(2A) is used disjunctively. Furthermore, he argued that even if recognition under section 35(1)(ii) was a pre-condition, the trust had the required recognition when the research programme was approved under section 35(2A). The tribunal examined the relevant provisions: - Section 35(1)(ii) pertains to donations made to scientific research associations or institutions approved by the prescribed authority. - Section 35(2A) allows for a weighted deduction for donations made to approved scientific research programmes, considering India's social, economic, and industrial needs. The tribunal noted that section 35(2A) encompasses a broader scope, including physical, social, and statistical research, unlike section 35(1)(ii), which focuses on scientific research in natural or applied sciences. The tribunal concluded that the term "scientific research" in section 35(2A) should be given a wider interpretation to include all types of research mentioned in sections 35(1)(ii) and 35(1)(iii). The tribunal further noted that the purpose of approval under section 35(1)(ii) is to ensure that the institution has the necessary facilities to carry out research. Since the prescribed authority also considers this while granting approval under section 35(2A), a separate approval under section 35(1)(ii) is unnecessary. The tribunal concluded that for claiming the weighted deduction under section 35(2A), the institution need not have recognition under section 35(1)(ii) at the time of donation. The assessee's case was stronger because the trust had the required recognition when the programme was approved. Therefore, the tribunal found no infirmity in the first appellate authority's order and confirmed it. Conclusion: The appeal by the revenue was dismissed on both grounds.
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