Case Law Details
Global Research Forum on Diaspora and Transnationalism Vs CIT (ITAT Delhi)
Introduction: The Income Tax Appellate Tribunal (ITAT) Delhi, in a recent ruling, highlighted the significance of correct classification of income. The dispute revolved around whether the service income received by the Global Research Forum on Diaspora and Transnationalism should be considered a donation due to its misrepresentation in the books.
The Assessee’s Application: The Global Research Forum on Diaspora and Transnationalism, which consists of a consortium of researchers and policymakers from worldwide institutions, applied for registration under Section 12A(1)(ac)(iii) of the Income Tax Act, 1961. However, their application faced rejection by Ld. CIT(E), Delhi based on certain grounds.
The Controversial Receipt: A critical point of contention was a receipt from Queen Mary University of London, amounting to GBP 9,500 (equivalent Rs. 12,57,005). This was for a project on ‘Migration, Pandemic and Responses from the Third Sector: Lessons from Brazil and India’. Ld. CIT(E) classified this receipt as a donation, leading to a violation of the Foreign Contribution Regulation Act (FCRA 2010) since the assessee lacked FCRA registration.
The Assessee’s Defense: The assessee contested, arguing that the amount was service income for research services, not a donation as per Section 2(1)(h) of FCRA 2010. Documentation, including tax invoices, study reports, and payment advice, was presented to support their claim.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
