Case Law Details
Optum Global Solutions (India) Private Limited Vs DCIT (ITAT Hyderabad)
ITAT Hyderabad held that as conditions of Section 80G of the Income Tax Act are satisfied, the assessee is entitled to claim deduction under Section 80G of the Act in respect of such donations which formed part of the spend towards CSR.
Facts- While scrutinizing the return of income of the assessee, AO made certain additions which include the disallowance of the deduction u/s. 80G of the Income Tax Act. Notably, assessee donated Rs. 1,11,46,000/- to the Prime Minister’s National Relief Fund which is eligible for 100% deduction u/s. 80G of the Act, and another sum of Rs. 2,66,54,000/- to the institutions Smile Foundation, Vidya Comfort School, Parikrama Humanity Foundation, Helpage India, Udayan Care, Narayana Hrudayalaya Charitable Trust and Sewa International, which are eligible for 50% deduction under Section 80G of the Income Tax Act. Accordingly, the assessee claimed a deduction of Rs. 1,33,27,000/-.
AO, however, disallowed the deduction u/s. 80G of the Act stating that CSR expenditure incurred u/s. 135 of the Companies Act is categorically disallowed u/s. 37 of the Act, and, therefore, on similar logic deduction u/s. 80G cannot be allowed.
Conclusion- Out of so many entries under section 80G(2) of the Act, on-ly donations in respect of two entries are restricted if such payments were towards the discharge of the CSR. The Legislature could have put a similar embargo in respect of the other entries also, but such a re-striction is conspicuously absent for other entries. The irresistible conclusion that would flow from it is that it is not the legislative intention to bar the payments covered by section 80G(2) of the Act which were made pursuant to the CSR, and other than covered by section 80G(2)(iiihk) and (iiihl) of the Act.
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