Arun Pratap Singh Vs ITO (ITAT Delhi)
ITAT Upholds Denial of Section 80GGC Deduction for Donations to Alleged Accommodation Entry Political Party
The Delhi ITAT upheld the disallowance of deduction claimed under Section 80GGC in respect of a donation of ₹3 lakh made to Rashtriya Samajwadi Party (Secular), despite the payment having been made through banking channels and supported by a donation receipt.
The Tribunal noted that search proceedings on the political party had revealed a systematic accommodation entry racket, wherein donations received through cheques or bank transfers were allegedly routed through multiple entities and ultimately returned to donors in cash after deducting commission. Statements of the party’s office bearers and findings of the Investigation Wing supported this modus operandi.
Relying on earlier decisions of the Ahmedabad, Mumbai and Delhi Benches, the Tribunal held that where evidence establishes that a political party was merely facilitating bogus donation entries, the mere existence of a bank transaction or donation receipt is insufficient to establish a genuine claim under Section 80GGC. Since the assessee could not bring any fresh material to rebut the investigation findings, the Tribunal confirmed the denial of deduction and dismissed the appeal.
FULL TEXT OF THE ORDER OF ITAT DELHI
