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TMI Blog2020 (5) TMI 378X X X X Extracts X X X X X X X X Extracts X X X X ..... VI A, which is considered for computing Total Taxable Income . If assessee is denied this benefit, merely because such payment forms part of CSR, would lead to double disallowance, which is not the intention of Legislature. Authorities below have erred in denying claim of assessee under section 80G of the Act. We also note that authorities below have not verified nature of payments qualifying exemption under section 80G of the Act and quantum of eligibility as per section 80G(1) of the Act. We are remitting the issue back to Ld.AO for verifying conditions necessary to claim deduction under section 80G of the Act. - Decided in favour of assessee for statistical purposes. - ITA No.1693/Bang/2019 - - - Dated:- 29-4-2020 - Shri. B. R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ithout prejudice to one another. Brief facts of the case are as under: 2. Assessee is a company and filed its return of income on 30/11/2016 declaring income of ₹ 73,44,38,310/-. The case was selected for scrutiny and notice under section 143 (2) and 142 (1) along with questionnaire was issued to assessee. In response to statutory notices, representative of assessee appeared before Ld.AO and filed requisite details as called for. 3. Ld.AO from the details furnished by assessee observed that assessee claimed deduction amounting to ₹ 8,40,000/- under section 80 G of the Act, towards donation paid. Ld.AO was of the opinion that claim made under section 80 G of the Act, was not allowable as the amount was forming part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for contribution under section 80 G towards such Bharat Kosh and clean Ganga fund (being 80G(2)(iiihk) (iiihl), all other payments are eligible for 80 G deductions. 9. On the contrary, Ld.Sr.DR submitted that Finance Bill, 2014 inserted Explanation 2 in Section 37(1) to clarify that, any expenditure incurred by an assessee on the activities relating to CSR referred to in section 135 of the Companies Act, 2013 shall not be deemed to be an expenditure incurred by assessee the purpose of business or profession and, therefore, no deduction would be allowed for such expenditure. He submitted that, expenditure incurred by assessee towards fulfilment of CSR responsibility and therefore has been rightly denied by authorities below. We have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenditure cannot be allowed under the existing provisions of section 37 of the Income-tax Act. Therefore, in order to provide certainty on this issue, it is proposed to clarify that for the purposes of section 37(1) any expenditure incurred by an assessee on the activities relating to corporate social responsibility referred to in section 135 of the Companies Act, 2013 shall not be deemed to have been incurred for the purpose of business and, hence, shall not be allowed as deduction under section 37. However, the CSR expenditure which is of the nature described in section 30 to section 36 of the Act shall be allowed deduction under those sections subject to fulfilment of conditions, if any, specified therein. 13. From the above ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rity transaction tax. Income Tax Act, under section 80G, forming part of Chapter VIA, provides for deductions for computing taxable income as under: Section 80G(2) provides for sums expended by an assessee as donations against which deduction is available. a) Certain donations, give 100% deduction, without any qualifying limit like Prime Minister's National Relief Fund, National Defence Fund, National Illness Assistance Fund etc., specified under section 80G(1)(i) b) Donations with 50% deduction are also available under Section 80G for all those sums that do not fall under section 80G(1)(i). Under Section 80G(2) (iiihk) and (iiihl) there are specific exclusion of certain payments, that are part of CSR responsibility, no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot agree with arguments advanced by Ld.Sr.DR. 18. In present facts of case, Ld.AR submitted that all payments forming part of CSR does not form part of profit and loss account for computing Income under the head, Income from Business and Profession . It has been submitted that some payments forming part of CSR were claimed as deduction under section 80G of the Act, for computing Total taxable income , which has been disallowed by authorities below. In our view, assessee cannot be denied the benefit of claim under Chapter VI A, which is considered for computing Total Taxable Income . If assessee is denied this benefit, merely because such payment forms part of CSR, would lead to double disallowance, which is not the intention of Legisl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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