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TMI Blog2024 (12) TMI 1522X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer [AO] u/s.143(3) r.w.s 144C(3) r.w.s 144B of the Act on 08-10-2021. The sole grievance of the assessee is denial of deduction of Rs.38.54 Lacs u/s 80G for its contribution towards Prime Minister's National Relief Fund. 2. The Ld. AR advanced arguments supporting the case of the assessee whereas Ld. Sr. DR referred to the adjudication of Ld. CIT(A) in the impugned order. Having heard rival submissions and upon perusal of case records, our adjudication would be as under. Proceedings before lower authorities 3.1 During assessment proceedings, it transpired that the assessee spent an amount of Rs.38.54 Lacs towards CSR expenditure but disallowed the same in statement of total income. However, the assessee claimed deduction thereof u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enditure is to share burden of the Government in providing social services by companies having net worth / turnover / profit above a threshold. If such expenses are allowed as deduction the same would result into subsidizing of around one-third of such expenses by the Government by way of tax expenditure. However, Clause 13 of the Finance Act, 2014 provide that though deduction of CSR expenditure is not available u/s 37, however, if the CSR expenditure is of the nature as described in Sec.30 to Sec.36 of the act, the deduction of the same would be allowed under those sections subject to fulfillment of conditions as specified therein. The same is amply clear from Circular No.1/2015 [F.NO.142/13/2014-TPL] dated 21- 01-2015 as under: - 13.3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wability of CSR expenditure is not completely ruled out. 5. We further find that bouquet of activities that have been permitted under CSR Scheme, inter-alia, include contribution to Prime Minister's National Relief Fund or any other fund set up by the Government for socio economic development. The impugned donation as made by the assessee is one of the prescribed modes of CSR Activities. 6. We also find that Finance Act, 2015 has allowed tax benefits u/s 80G for donations made to Swachh Bharat Kosh and Clean Ganga Fund. The amendment and explanatory statement read as under: - Tax benefits for Swachh Bharat Kosh and Clean Ganga Fund Under the existing provisions of section 80G of the Income-tax Act, a deduction is allowed in computing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spent in pursuance of Corporate Social Responsibility under sub-section (5) of section 135 of the Companies Act, 2013, will not be eligible for deduction from the total income of the donor. The existing provisions of section 10(23C) of the Act provide for exemption from tax in respect of the income of certain charitable funds or institutions like the Prime Minister's National Relief Fund ; the Prime Minister's Fund (Promotion of Folk Art); the Prime Minister's Aid to Students Fund; the National Foundation for Communal Harmony. Considering the importance of Swachh Bharat Kosh and Clean Ganga Fund, it is also proposed to amend section 10(23C) of the Act so as to exempt the income of Swachh Bharat Kosh and Clean Ganga Fund from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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