TaxTMI 
TaxTMI 
2024 (12) TMI 457
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.... Faceless Assessment Centre ('Assessment Centre') under section 143(3) read with section 144B of the Income-tax Act, 1961 ("the Act") and the order dated 08.11.2023 passed by the National Faceless Appeal Centre ('Appeal Centre') under section 250 of the Act for the Assessment Year ("AY") 2020- 21, and the additions/ disallowances made therein, are based on surmises and conjectures, and hence, bad in law. 2. That the Assessment Centre/ Appeal Centre has erred on facts and in law in disallowing the deduction claimed under section 80G of the Act to the extent of Rs 2,57,66,663/- alleging that the expenses incurred on account of Corporate Social Responsibility ("CSR") are not eligible for deduction under section 80G of the Act. 3. That the ....
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.... in view of the facts and circumstances of the case and in law, the Assessment Centre has erred in initiating the penalty proceedings against the assessee under section 270A of the Act. 8. That the documents, explanations filed by the Appellant, and the material available on record have not been properly considered and judicially interpreted and have been wrongly ignored. 2. The brief facts of the case are that the assessee filed its return of income on 10.02.2021 and processing u/s. 143(3) was completed on 20.09.2022. The AO made the disallowance of claimed as donation u/s. 80G amounting to Rs. 2,57,66,663/-, charged interest u/s. 115P amounting to Rs. 5,79,69,120/- and initiated penalty proceedings u/s. 270A of the Act. Against the AO'....
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....g decisions in the instant case and allow the grounds raised in the appeal. 1. Ratna Sagar Pvt. Ltd. vs. ACIT, Central Circle-4, New Delhi ITA No. 2256/Del/23 2. Honda Motorcycle & Scooter India Pvt. Ltd. vs. ACIT, Circle 1(1), Gurugram ITA No. 1523/Del/22 3. Interglobe Technology Quotient Private Limited vs. ACIT, Circle 10(1), New Delhi. ITA No. 95/Del/24 4. M/s Goldman Sachs Services Pvt. Ltd. vs. JCIT, Special Range-3, Bangalore. IT(TP)A No. 2355/Bang/2019 5. M/s JMS Mining Pvt. Ltd. vs. PCIT, Kolkata-2, Kolkata. ITA No. 146/Kol/21 6. Ericsson India Global Services Private Limited vs. DCIT, Circle 7(1), New Delhi ITA No. 1150/Del/22 7. Optum Global Solutions (India) Private Limited, Hyderabad vs. DCIT, Circle 5(1), H....
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....did not controvert the aforesaid proposition made by the Ld. AR, but he supported the orders of the authorities below. 6. Upon careful consideration, we find considerable cogency in the contention of the Ld. AR that identical issue has been dealt by the Coordinate Bench of ITAT, Delhi vide order dated 28.05.2024 passed in ITA No. 95/Del/2024 (AY 2020-21) in the case of Interglobe Technology Quotient Private Limited, wherein the Coordinate Bench has held as under:- "7. Learned DR has failed to bring forth any decision to the contrary. Thus, we accept the plea of learned counsel on the basis of case law cited, denial of CSR expenditure u/s 37(1) of the Act is not embargo to claim deduction u/s 80G of the Act. 7.1 Further, we like to obs....
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....ent year 2015-16), which provided that any expenditure incurred by an assessee on the activities relating to CSR referred to in section 135 of the CA 2013, shall not be deemed to be an expenditure incurred by an assessee for the purpose of business or profession and shall not be allowed as deduction under section 37(1) of the IT Act. The intent of Parliament in bringing the aforesaid provision is given in the Explanatory Memorandum to the Finance (No.2) Bill, 2014 and is reproduced as under ; "CSR expenditure, being an application of income, is not incurred wholly and exclusively for the purposes of carrying on business, As the application of income is not allowed as deduction for the purposes of computing taxable income of a company, amo....
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....tion 2 to section 37(1) of the Act. Thus, there is no correlation between suo-moto disallowance in section 37(1) and claim of deduction under section 80G of the Act. 7.5 As with regard to the reasoning that CSR expenditure are not voluntary but mandatory in nature due to penal consequences, we are of considered view that voluntary nature of donation is by nature of fact that it is not on the basis of any reciprocal promise of donee. The CSR expenditures are also without any reciprocal commitment from beneficiary being philanthropic in nature. The Act permits deduction of donations as per Section 80G of the Act, even though, assessee is not gaining any benefit out of any reciprocity from donee. Similar is the case of CSR expenditure. Thus ....