INCOME TAX ACT, 1961

Section 80G

Deduction under section 80G - Allowability - Donation paid by assessee treated as forming part of CSR expenses - Assessee pleading double disallowance

Assessee-company engaged in BPO operations claimed deduction under section 80G towards donation paid. AO took the view that claim made under section 80G, was not allowable as amount was forming part of CSR expenses debited to profit and loss account and donation made outside CSR expenses was only eligible to be claimed under section 80G. Assessee submitted that it could not be denied the benefit of claim under Chapter VI-A, which is considered for computing 'total taxable income'. If assessee was denied this benefit, merely becasue such pamyment formed part of CSR, would lead to double disallowance, which is not the intention of Legislature.Held: AO without verifying nature of payments qualifying exemption under section 80G and quantum of eligibility as per section 80G(1) erred in denying claim of assessee under section 80G and accordingly, issue was referred back to AO for verifying conditions necessary to claim deduction under section 80G and assessee was directed to file all requisite details in order to substantiate its claim.

REFERRED :

FAVOUR : Matter remanded.

A.Y. : 2016-17

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