Case Law Details
ABIS Export India Pvt Ltd Vs DCIT (ITAT Raipur)
The dispute arose when the Assessing Officer (AO) disallowed ABIS’s deduction under Section 80G, citing that CSR expenditures, although mandatory under the Companies Act 2013, do not qualify as voluntary donations eligible for tax benefits under 80G. The AO’s decision was based on the Finance (No.2) Act, 2014, which explicitly disallows CSR expenses for tax deductions under certain conditions.
ABIS argued that the mandatory nature of CSR does not preclude its eligibility under 80G, supported by legal precedents and the legislative intent analysis. They pointed out that CSR expenses, despite being mandatory, align with the spirit of charitable contributions as defined under 80G, thus warranting deduction.
During the appeal before the CIT(Appeals), the contention remained unresolved, leading ABIS to appeal further to the Income Tax Appellate Tribunal (ITAT) in Raipur. The ITAT reviewed previous judicial decisions and the legislative framework to assess the eligibility of CSR expenses under Section 80G. It acknowledged ABIS’s arguments and directed the CIT(A) to reconsider the case, emphasizing procedural fairness and the need for a comprehensive review of evidence.
FULL TEXT OF THE ORDER OF ITAT RAIPUR
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