TaxTMI 
TaxTMI 
TaxTMI 
2025 (8) TMI 349
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....DRP"), Bengaluru in the case of Xilinx India Technology Services ("the assessee") for the assessment year 2020-21, assessee preferred this appeal. 2. Brief facts of the case are that the assessee incurred certain expenses as a part of CSR expenditure, as mandated under section 135 of the Companies Act and both the authorities, namely, the learned Assessing Officer and the learned CIT(A) denied the same stating that the essential prerequisite element of donation, namely, the voluntariness, as stipulated in section 80G of the Income Tax Act, 1961 (for short "the Act") is conspicuously absent in respect of these expenses that were met under the compulsion of law under section 135 of the Companies Act. 3. Learned CIT(A) referred to the object....
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....rth/turnover/profit above a threshold. 6. We have gone through the record in the light of the submissions made on either side in the decisions cited by the learned AR, the coordinate benches of this Tribunal followed the view taken by the Kolkata Bench of the Tribunal in the case of JMS Mining (P.) Ltd (supra). For the sake of completeness, we deem it just and necessary to reproduce the relevant observations of the Kolkata Bench hereunder: - "22. From a bare reading of the section 80G of the Act we note that deduction under this section has to be made in accordance with and subject to the provisions of this section i.e. section 80G of the Act. As per this section i.e. section 80G of the Act, an amount equal to fifty percent (50%) of the ....
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....& Clean Ganga Fund (iiihk) and (iiihi) of clause (a) of sub-section (2) of section 80G of the Act, then deduction u/s. 80G of the Act is not allowable, which can be illustrated by giving certain examples (infra). However, in a case scenario, wherein the assessee expends the mandatory expenditure and gives donation to these two projects i.e. over and above the mandatory CSR expenditure u/s. 135 of Companies Act, that sum donated to Swach Bharat Kosh & Clean Ganga Fund will be eligible for 100% deduction u/s. 80G of the Act [refer section 80G(1)(i) and subject to section 80G(4)]. However, such a restriction in respect of expenditure made by an assessee to any other fund or institution as referred to in sub clause (iv) of clause (a) of sub-sec....
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....an be cumulatively illustrated by the following examples for ease of understanding purpose only and should not be cited for making claim which should be made subject to the facts and law involved in each case and also subject to section 80G(4) of the Act: Example: A company has reported eligible net profit u/s 135 of Companies Act, 2013 at Rs. 100 crores. The minimum CSR contribution of 2% under Section 135(5) of the Act works out to be Rs. 2 crores. Situation 1 : The company has been spent the required minimum CSR contribution of Rs 2 crores towards construction of roads & schools in the vicinity of the backward area where the factory is located. Tax Treatment: The entire CSR expenditure of Rs. 2 crores is to be disallowed and added ....
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....m deduction for hundred percent of the donation of Rs. 1 crores paid to Prime Minister's National Relief Fund u/s 80G(2)(iiia) read with Section 80G(1)(i) of the Act. The company claim deduction to the extent of fifty percent of the donation of Rs. 1 crores paid to any other registered charitable trust u/s 80G(2)(iv) read with Section 80G(1)(ii) of the Act. 23. As discussed supra, we concur with the contention of the assessee that since Parliament intended certain restrictions to only CSR expenditure in respect of two donations included by an assessee as CSR expenditure i.e. [Swachh Bharat Kosh and Clean Ganga Fund] has impliedly not made any prohibition/restriction in respect of claim of CSR expenses in other cases if it is otherwi....
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....o look into the provisions of Explanation-2 to section 37(1) of the Act, which says that any expenditure relatable to the discharge of CSR, is not a business expenditure and cannot be allowed as such. If the assessee does not claim any deduction of such amount spent as CSR under any of the provisions between 30 and 36 of the Act, and suo-moto disallowed the same by adding it back to the P&L account, and it is only thereafter the business income of the assessee computed in accordance with the principles laid down for computation of the profits and gains of business or profession in sections 28 to 44DB of the Act, then the donations covered under section 80G of the Act cannot be denied and on compliance with Explanation-2 of section 37 of the....