The Tax Publishers2020 TaxPub(DT) 4935 (Kol-Trib) : (2022) 193 ITD 0649

INCOME TAX ACT, 1961

Section 263

AO had called for and obtained explanation for CSR expenses incurred by assessee and after duly considering explanation furnished by assessee, AO allowed assessee's claim. Thus, it was not a case where there was no enquiry by AO. Also, amendment brought about by way of Explanation 2 to section 37 by Finance Act, 2014, was only with effect from 1-4-2015 and not retrospectively. Therefore, expenditure incurred on CSR in accordance with guidelines issued by Govt. of India was allowable as a deduction for both assessment years 2013-14 and 2014-15.

Revision under section 263 - Erroneous and prejudicial order - Pr.CIT alleged lack of enquiry on AO's part as regards allowability of CSR expenses -

Pr.CIT held assessment order as erroneous and prejudicial to the interest of revenue on the ground of AO not having enquired into allowability of corporate Social Responsibility (CSR) expenses. Held: AO had called for and obtained explanation for CSR expenses incurred by assessee and after duly considering explanation furnished by assessee, AO allowed assessee's claim. Thus, it was not a case where there was no enquiry by AO. Also, amendment brought about by way of Explanation 2 to section 37 by Finance Act, 2014, was only with effect from 1-4-2015 and not retrospectively. Therefore, expenditure incurred on CSR in accordance with guidelines issued by Govt. of India was allowable as a deduction for both assessment years 2013-14 and 2014-15.

Supported by:Misrilall Mines (P) Ltd. ITA No. 738/Kol/2017 and Asstt. CIT v. Jindal Power Ltd. Raipur Bench ITA No. 99/BLPR/2012, Order dt. 23-6-2016 : 2016 TaxPub(DT) 3082 (Rah-Trib).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2013-14 & 2014-15



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