Revenue's appeal rejected on anonymous donations under Income Tax Act; trust's compliance with donor disclosure upheld

The revenue's appeal against the deletion of the addition of Rs.2,61,72,000/- as anonymous donations under Section 115BBC of the Income Tax Act, 1961 was dismissed. The Commissioner of Income Tax (Appeals) ruled in favor of the assessee trust, a charitable organization, stating that the trust had provided names and addresses of all donors, meeting the requirements of the law. The Tribunal upheld this decision, emphasizing the trust's compliance with maintaining donor identities, leading to the conclusion that the donations were not anonymous as per Section 115BBC.

---

---

Issues Involved:
1. Deletion of addition of Rs.2,61,72,000/- as anonymous donations under Section 115BBC of the Income Tax Act, 1961.

Summary:

Issue: Deletion of Addition of Rs.2,61,72,000/- as Anonymous Donations under Section 115BBC of the Income Tax Act, 1961

The revenue appealed against the order of the Learned Commissioner of Income Tax (Appeals) - 1, Patna, which deleted the addition of Rs.2,61,72,000/- made by the Assessing Officer (AO) under Section 115BBC of the Income Tax Act, 1961. The AO had treated the donations received by the assessee trust as anonymous donations, leading to an assessment of income at Rs.2,87,88,843/-.

The assessee trust, a charitable organization registered under Section 12AA, had filed its return declaring total income at 'Nil'. During scrutiny, the AO found that the trust received donations amounting to Rs.2,61,72,000/- from 1371 persons, none exceeding Rs.20,000/-. The AO issued letters/summons to 109 donors, but many remained unserved or denied making donations, leading the AO to consider the donations as anonymous under Section 115BBC.

The First Appellate Authority deleted the addition, stating that the assessee had provided names and addresses of all donors, fulfilling the requirements of Section 115BBC(3). The AO's adverse inference was based on incomplete verification due to time constraints. The CIT(A) found that the assessee maintained proper records of donor identities, and subsequent verifications confirmed the donations.

The Tribunal upheld the CIT(A)'s decision, emphasizing that the assessee complied with Section 115BBC(3) by maintaining donor identities, thereby not attracting the section's provisions. The AO's failure to conclusively prove the donations as anonymous led to the dismissal of the revenue's appeal.

Conclusion:
The appeal by the revenue was dismissed, and the order of the CIT(A) was upheld, confirming that the donations were not anonymous under Section 115BBC of the Income Tax Act, 1961.

---