Tribunal Grants Deduction for Donations Despite Recognized Status Withdrawal, Overturning Previous Decision.

The Tribunal allowed the appeals, reversing the CIT(A)'s decision and granting the assessee the deduction under section 35(1)(ii) of the Income Tax Act for donations made to SHG&PG. The Tribunal determined that the withdrawal of recognition post-donation did not impact the assessee's entitlement to the deduction, aligning with prior Tribunal decisions.

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Issues:
Disallowance of deduction under section 35(1)(ii) of the Income Tax Act in relation to donation given to School of Human Genetics & Population Health (SHG&PG).

Analysis:
The appeals arose from orders of the Commissioner of Income Tax (Appeals) confirming the disallowance of deduction under section 35(1)(ii) of the Act for donations to SHG&PG. The Assessments were framed by the Assistant Commissioner of Income Tax for the relevant assessment years. The AO initiated the reassessment based on information received regarding alleged accommodation entries for donations claimed under section 35(1)(ii). The AO disallowed the deduction as investigations revealed the donations were not utilized for scientific research or infrastructure. The CIT(A) upheld the AO's decision, leading to the appeals before the Tribunal.

The assessee contended that the donations were genuine and supported by receipts and necessary approvals. The institution, SHG&PG, held various registrations and certificates demonstrating eligibility for receiving donations under section 35(1)(ii). The assessee argued that the institution underwent a rigorous verification process by government authorities before being notified for such donations. The assessee also cited a Tribunal decision in a similar case where the deduction was allowed despite the withdrawal of recognition post-donation.

The Tribunal considered the evidence presented by the assessee and the legal provisions. Referring to previous Tribunal decisions, the Tribunal held that the withdrawal of recognition post-donation does not affect the entitlement of the payer to claim the deduction under section 35(1)(ii). Citing consistency with prior decisions, the Tribunal allowed the appeals for both assessment years, concluding that the assessee was entitled to the deduction for donations made to SHG&PG.

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