TaxTMI 
TaxTMI 
2026 (3) TMI 1570
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.... Tax Act. 2. The brief facts of the case are that the assessee had filed its return of income for A.Y. 2020-21 on 28.05.2021 declaring total income of Rs. 6,83,24,890/-. The case was selected for complete scrutiny under CASS. In the course of assessment of the AO had made disallowance of Rs. 35,96,047/- on account of deduction claimed under section 80G of the Act. The assessment was completed under section 143(3) on 27.09.2022 at total income of Rs. 7,19,20,937/-. Subsequently, the case record was called for and examined by the PCIT. He found that the assessee had made payment of Rs. 3 crores to "All India Social Education and Charitable Trust" (hereinafter referred as "AISECT") towards CSR activity, which was claimed as deduction under ....
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....a direction to pass fresh assessment order after re-examining these two issues. 3. Aggrieved with the order of the Ld. PCIT, the assessee is in appeal before us. The following grounds have been taken in this appeal: 1. The Learned Pr. Commissioner of Income Tax, Ahmedabad -3 has erred in passing an order u's 263 of the IT Act 1961 setting aside the Assessment Order passed us. 143(3) rows 144B of the IT. Act. 1961 did 27.092022 which is neither erroneous nor prejudicial to the interest of the Revenue 2 The Learned Pr Commissioner of Income Tax, Ahmedabad-3 has erred in passing an order u/s 263 of the IT Act, 1961 since the issues sought to be revised have been examined in the assessment proceedings hence the same bei....
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....appeal. 4. Shri Aseem Thakkar, the Ld. AR of the assessee submitted that both the issues on which the Ld. PCIT had passed the revisional order u/s 263 of the Act, were duly examined by the AO in the course of assessment proceeding. He explained that CSR expense of Rs. 3 crore was duly explained before the AO and it was contended that only the donation towards CSR activity made to Swachh Bharat Kosh and Clean Ganga Fund were liable to be disallowed under section 80G of the Act. Still, the AO had made disallowance of Rs. 35,96,047/- in respect of the donation claimed under section 80G of the Act made to All India Social Education and Charitable Trust. He submitted that the Ld. PCIT was not correct in directing that amount of Rs. 3 crores p....
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....not examined by the AO at all. Hence, the Ld. PCIT had rightly held that the order of the AO was erroneous and pre-judicial to the interest of revenue. He, therefore, strongly supported the order of the Ld. PCIT. 6. We have carefully considered the rival submissions. There is no dispute to the fact that the assessee had debited an amount of Rs. 3 crores in respect of CSR expense paid to AISECT. The assessee had claimed deduction u/s 80G of the Act in respect of this donation of Rs. 3 crores made to AISECT. The deductible amount at the rate of 50% was Rs. 31,02,337/- of the qualifying amount of Rs. 62,04,674/- which was disallowed by the AO. However, the book profit of the assessee was worked out after claiming deduction for CSR expenses ....
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....d categorically held that the Assessing Officer had no authority to reopen accounts of a company which were certified by auditors of the company as having been maintained in accordance with the provisions of the Companies Act and that he had limited power of making additions and reductions as provided for in Explanation to the said section. 8. In view of the law as laid down by the Hon'ble Supreme Court, the AO could not have disturbed the book profit and the adjustment on account of CSR expenses could not have been made as per Explanation to section 115JB of the Act. Thus, the AO could not have made any adjustment to the MAT income in respect of CSR expense and therefore, the order of the AO could not have been held as erroneous and pre....