AI Insights
The case revolves around the dispute concerning the eligibility of CSR expenses for deduction under section 80G of the Income Tax Act, 1961. The Deputy Commissioner of Income Tax (DCIT) had disallowed a portion of the CSR expenses claimed by Honeywell Automation India Limited, arguing that these expenses were not admissible under section 37 of the Act and thus not deductible under section 80G. However, the Commissioner of Income Tax (Appeals) reversed this decision, leading to the Revenue's appeal to the Tribunal. The Tribunal, referencing multiple judicial precedents, supported the assessee's position that CSR expenses, when donated to eligible entities, qualify for deductions under section 80G.
Appeal Details
Counselvise Citation
[2025] 140 COUNSELVISE.COM (IT) 792108 (ITAT-PUNE)
Assessee PAN
Bench
Appeal Number
CRN Number
Duration Of Justice
7 month(s) 16 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
09-12-2025
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
A
Assessment Year
2020-2021
Appeal Filed On
23-04-2025
Judgement Text
" आयकर अपीलीय अधिकरण “ए” न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI R.K. PANDA, VICE PRESIDENT AND MS. ASTHA CHANDRA, JUDICIAL MEMBER आयकर अपील सं. / ITA No.1096/PUN/2025 धििाारण वर्ा / Assessment Year : 2020-21 Dy. Commissioner of Income Tax, Circle-1(1), Pune Vs. Honeywell Automation India Limited, 56 and 57, Hadapsar Industrial Area, Hadapsar, Pune-411013, PAN : AAACT3904F अपीलार्थी / Appellant प्रत्यर्थी / Respondent Assessee by : Shri Siddhesh Chaugule & Ms. Vijayalaxmi Ranka Department by : Shri Manish M. Mehta Date of hearing : 03-11-2025 Date of Pronouncement : 09-12-2025 आदेश / ORDER PER ASTHA CHANDRA, JM : The appeal filed by the Revenue is directed against the order dated 27.02.2025 of the Ld. Commissioner of Income Tax (Appeals), NFAC, Delhi [“CIT(A)/NFAC”] pertaining to Assessment Year (“AY) 2020-21. 2. Briefly stated, the facts of the case are that the assessee e-filed its return of income for AY 2020-21 declaring income of Rs.673,42,87,750/- on 24.05.2021. The return was processed u/s 143(1) of the Income Tax Act, 1961 (the “Act”) and was subsequently selected for scrutiny under CASS. Statutory notice(s) u/s 143(2) and 142(1) along with questionnaire were accordingly issued and served upon the assessee, in response to which, the assessee furnished its reply from time to time. During the assessment proceedings, the Ld. Assessing Officer (“AO”) found that the assessee had debited an amount of Rs.8,28,36,334/- on account of Corporate Social Responsibility (“CSR”) in its P & L Account and added back the said amount of Rs.8,28,36,334/- to its income being inadmissible expenses as per the provisions of section 37 of the Act. However, the assessee claimed deduction of Rs.9,49,88,101/- u/s 80G out of total Printed from counselvise.com 2 ITA No.1096/PUN/2025, AY 2020-21 deduction of Rs.18,99,76,201/- (50% of Rs.18,99,76,201/-). Accordingly, the Ld. AO issued show cause notice to the assessee to justify the claim of deduction u/s 80G of the Act. The assessee filed its reply before the Ld. AO contending that there is no restriction imposed on claiming deduction under 80G of the Act, even if the expenses have been incurred for the purposes of the CSR activity, provided the payment is made to eligible entities as listed in section 80G of the Act. The assessee has donation/CSR spend which is not an allowable business expense and hence the same has been disallowed suo-moto in the computation of income. The reply of the assessee was not found to be convincing by the Ld. AO. According to the Ld. AO there is no finality of law on the impugned issue and in the previous year also there was an addition on this issue. He therefore completed the assessment u/s 143(3) r.w.s. 144B of the Act on 25.09.2023 by making an addition of Rs.4,14,18,167/- (50% of the eligible amount) on account of disallowance of deduction claimed u/s 80G of the Act. 3. Aggrieved by such order of the Ld. AO, the assessee preferred an appeal before the Ld. CIT(A)/NFAC. The Ld. CIT(A)/NFAC after considering the submissions of the assessee and relying on various decisions involving the impugned issue in favour of the assessee, deleted the addition of Rs.4,14,18,167/- made by the Ld. AO by observing as under : “5.6 In the appellate proceedings, the appellant submitted that: (i). The appellant incurred Corporate Social Responsibility (CSR) expenditure amounting to Rs.18,99,76,201/-in terms of Section 135 of the Companies Act, 2013 by donating the said amount towards M/s Honeywell Hometown Solutions Foundation (PAN:AADCH4630B). (ii). The said CSR expenditure was added back in the computation of income under the head “Profits and gains of business or profession” in accordance with Explanation 2 to Section 37(1) of the Act. (iii). As the donee institution was approved u/s 80G(5)(vi) of the Act, the appellant claimed 50% deduction u/s 80G(1)(ii) read with Section 80G(2)(a)(iv) of the Act on the said donation. (iv). Section 37(1) of the Act imposes no restriction on claiming deduction u/s 80G of the Act on CSR expenses as long as the conditions stipulated in Section 80G of the Act are satisfied.The restriction on CSR expenses provided therein does not extend to the provisions of Section 80G of the Act (except where it is expressly provided as in the cases of Swachh Bharat Kosh and Clean Ganga Fund u/s 80G(2)(a)(iiihk) and section 80G(2)(a)(iiihl) respectively). (v). From the report of September 2015 of the High-Level Committee set up by Ministry of Corporate Affairs (MCA) to suggest measures for improved monitoring of the implementation of CSR, FAQsvide MCA‟s General Circular 01/2016 dated 12/01/2016, FAQ on PM Cares Fund,MCA‟s Office Memorandum dated 28/03/2020 and PIB‟s press release dated Printed from counselvise.com 3 ITA No.1096/PUN/2025, AY 2020-21 31/03/2020, it is established that the intention of the Government is to allow deduction u/s 80G of the Act even on the amounts contributed as CSR. (vi). As the contributions made to an organization registered u/s 80G of the Act towards CSR activity in compliance with the Companies Act, 2013 benefit general public at large, it can be said that the object of such donations remains charitable and thus, such contributions qualify as donations for the purpose of Section 80G of the Act. 5.7 In support of its contentions, the appellant submitted copies of donation receipts, Section 80G certificates and other supporting documents. 5.8 The issue involved in the instant case is whether expenses made towards Corporate Social Responsibility (CSR) u/s 135(5) of the Companies Act, 2013 are eligible for deduction u/s 80G of the Act if such expenses are incurred towards contributions to eligible funds/institutions u/s 80G of the Act. Apart from the judgements relied upon by the appellant, this issue has been adjudicated in the following judgments: Cheil India (P.) Ltd. vs. DCIT [2024] 169 taxmann.com 507 (ITAT Delhi) L&T Finance Ltd. vs. DCIT [2024] 167 taxmann.com 503 (ITAT Kolkata) Interglobe Technology Quotient (P.) Ltd.vs. ACIT [2024] 163 taxmann.com 542 (ITAT Delhi) Ericsson India Global Services (P.) Ltd. vs. DCIT [2024] 160 taxmann.com 599 (ITAT Delhi) Power Mech Projects Ltd. vs. DCIT [2023] 156 taxmann.com 575 (ITAT Hyderabad Optum Global Solutions (India) (P.) Ltd. vs. DCIT [2023] 154 taxmann.com 651 (ITAT Hyderabad) Honda Motorcycle and Scooter India (P.) Ltd. vs. ACIT [2023] 153 taxmann.com 567(ITAT Delhi) Teradata India (P.) Ltd. v. DCIT [IT Appeal No. 1248 (Delhi) of 2022 P.C. Chandra Holding (P.) Ltd. v. Pr.CIT [IT Appeal No. 256 (Kol.) of 2022 JMS Mining (P.) Ltd. v. Pr. CIT [2021] 130 taxmann.com 118 (ITAT Kolkata) NaikSeafoods (P.) Ltd. v. Pr. CIT [IT Appeal No. 490 (Mum.) of 2021 FNF India (P.) Ltd. v. Asstt. CIT [2021] 133 taxmann.com 251 (ITAT Bangalore) 5.9 Respectfully following the ratio decidendi laid down in the above judgements, it is held that there is no statutory bar in claiming deduction u/s 80G of the Act on CSR expenses if the said expenses are otherwise allowable as deduction u/s 80G of the Act. Accordingly, the impugned addition Rs.4,14,18,167/- is deleted. 5.10 This ground of appeal agitated by the appellant is allowed.” 4. Dissatisfied, the assessee is in appeal before the Tribunal raising the following solitary ground of appeal : Printed from counselvise.com 4 ITA No.1096/PUN/2025, AY 2020-21 “1) Whether on the facts and circumstances of the case the Ld CIT(A) is right in deleting the addition of Rs. 4,14,18,167/- and holding that there is no statutory bar in claiming deduction u/s 80G of the Act on CSR expenses which are otherwise allowable as deduction w/s 80G without appreciating the fact that the CSR expenses are obligatory in nature and are specifically barred as expenses vide Explanation 2 to section 37(1) of the Act, and the assessee has taken refuge of section 80G to circumvent the said provisions of the Act. 2) Whether on the facts and circumstances of the case the Ld CIT(A) is right in deleting the addition of Rs. 4,14,18,167/- and holding that there is no statutory bar in claiming deduction u/s 80G of the Act on CSR expenses which are otherwise allowable as deduction u/s 80G without appreciating the fact that the CSR expenses are obligatory in nature and element of charity is missing in it as envisaged by section 80G of the Act. 3) The appellant craves to add, amend, alter or delete any of the above ground of appeal during the course of appellate proceedings before the Hon'ble Tribunal.” 5. The Ld. DR relied on the order of the Ld. AO. The Ld. DR admitted that the impugned issue is covered in favour of the assessee by various decisions of the Tribunals but the Department has not accepted this position and is in appeal before the Hon’ble High Court. 6. The Ld. AR, on the other hand, strongly supported the order of the Ld. CIT(A)/NFAC. Relying on the following decisions, he submitted that the impugned issue stands squarely covered in favour of the assessee and hence the order of the Ld. CIT(A)/NFAC should be upheld : i. Advik Hi Tech (P.) Ltd. v. Deputy Commissioner of Income-tax [2024] 168 taxmann.com 587 (Pune - Trib.); ii. Dana Anand India (P.) Ltd. v. Deputy Commissioner of Income-tax [2025] 174 taxmann.com 458 (Pune - Trib.); iii. Deputy Commissioner of Income-tax v. Gabriel India Ltd. [2025] 173 taxmann.com 219 (Mumbai - Trib.); iv. Deputy Commissioner of Income-tax v. Hinduja Global Solutions Ltd. [2025] 175 taxmann.com 411 (Mumbai - Trib.); v. Societe Generale Securities India (P.) Ltd. v. Principal Commissioner of Income-tax [2023] 157 taxmann.com 533 (Mumbai - Trib.); vi. Philips India Ltd. v. Deputy Commissioner of Income-tax [2025] 172 taxmann.com 340 (Kolkata - Trib.); vii. Peak XV Partners Advisors (P.) Ltd. v. Deputy Commissioner of Income-tax [2025] 173 taxmann.com 180 (Bangalore - Trib.); viii. L & T Finance Ltd. v. Deputy Commissioner of Income-tax [2024] 167 taxmann.com 503 (Kolkata - Trib.); Printed from counselvise.com 5 ITA No.1096/PUN/2025, AY 2020-21 ix. Sling Media (P.) Ltd. v. Deputy Commissioner of Income-tax [2022] 135 taxmann.com 164 (Bangalore - Trib.); x. First American (India) Pvt. Ltd. v. Assistant Commissioner of Income Tax ITA No.1762/Bang/2019 (Bangalore - Trib.). 7. We have heard the Ld. Representatives of the parties and perused the material on record. We have also perused the judicial precedents cited before us. The facts of the case are not in dispute. From perusal of the various decisions (supra) cited by the Ld. AR on the impugned issue, we find that there is a consistent view taken by the Co-ordinate Bench(es) of the Tribunal allowing the deduction u/s 80G of the Act in respect of CSR expenditure claimed by the assessee. 8. We find that the Pune Bench of the Tribunal in the case of Advik Hi Tech Pvt. Ltd. (supra) (to which both the present members are the parties) has held that the deduction claimed by the assessee u/s 80G of the Act on account of CSR expenditure deserves to be allowed. The relevant findings and observations of the Tribunal in Advik Hi Tech Pvt. Ltd.’s case are as under : “8. We have heard the Ld. Representatives of the parties and perused the records. The facts are not in dispute. We find that an identical issue came up for consideration before the Co-ordinate Bench of Pune Tribunal in the case of Credit Suisse Services (India) Private Limited (supra) wherein the Tribunal dismissed the appeal of the Revenue relying on the decision of the ITAT Bangalore in the case of Allegi Services (India) Pvt. Ltd. V. ACIT in ITA No. 1693/Bangalore/2019 wherein it was held that the assessee is entitled to claim deduction u/s 80G with respect to donations forming part of CSR expenses. The relevant observations and findings of the Co-ordinate Bench of Pune Tribunal in the case of Credit Suisse Services (India) Private Limited (supra) are as under : “3. Both the learned representatives next invited our attention to the CIT(A)'s impugned detailed discussion allowing the assessee‟s sec.80G deduction claim as under : “5. Decision I have carefully perused grounds of appeal, facts of the case, submissions made by the Appellant, assessment order and other evidences on records. 5.1. Ground 1 Vide this Ground, the Appellant has challenged action of the AO in making the disallowance of Rs.4,55,13,521/- u/s 80G with respect to the donations forming part of Corporate Social Responsibility („CSR‟). In this regard, the Appellant has submitted that : • The amount paid to various funds is without any consideration in return and is in the nature of irrevocable contribution. Thus, such contributions partake the character of donation Printed from counselvise.com 6 ITA No.1096/PUN/2025, AY 2020-21 • Since, all other requisite conditions under section 80G have been satisfied and not in dispute, the Appellant is eligible for deduction under section 80G of the Act. The institution to whom the Donations are made are duly registered under section 80G(5) of the Act • The CSR expenditure is not allowed only for the purpose of section 37 for computing business income. If such expenditure is otherwise allowable as deduction under other provisions of the Act, the same cannot be disturbed. • The donations/expenditure made by the Appellant is towards women empowerment, education, environmental research etc. and forms part of CSR expenditure as per Schedule VII of the Companies Act, 2013. • The legislature has restricted the benefit only in two specific cases being „Swachh Bharat Kosh‟ („SBK‟) and „Clean Ganga Fund‟ („CGF‟) as per sub-clause (iiihk) and (iiihl) of section 80G(2)(a) of the Act, thereby implying that CSR contribution to other eligible institution qualifies for deduction under section 80G of the Act. The Appellant has made CSR contribution to funds other than SBK and CGF, thus, claim under section 80G of the Act shall be allowed. • The said claim, as discussed above, is supported by the Explanatory Memorandum to Finance Bill 2014 with restriction placed only in relation to specified funds under section 80G, clarification issued by MCA and multiple favourable decisions. I have considered the submissions made by the Appellant. I find that the issue is covered in favour of the Appellant by various decisions of Hon‟ble Tribunals. I find that Hon‟ble ITAT Bangalore in the case of Allegi Services (India) Pvt Ltd vs ACIT, (ITA No.1693/Bangalore/2019) has decided this issue in favour of the assessee. Relevant part of the said decision is reproduced as under : “Brief facts of the case are as under: 2. Assessee is a company and filed its return of income on 30/11/2016 declaring income of Rs.73,44,38,310/-. The case was selected for scrutiny and notice under section 143 (2) and 142 (1) along with questionnaire was issued to assessee. In response to statutory notices, representative of assessee appeared before Ld.AO and filed requisite details as called for. 3. Ld.AO from the details furnished by assessee observed that assessee claimed deduction amounting to Rs.8,40,000/- under section 80 G of the Act, towards donation paid. Ld.AO was of the opinion that claim made under section 80 G of the Act, was not allowable as the amount was forming part of CSR expenses debited to profit and loss account. Ld.AO was of the opinion that donation made outside CSR expenses was only eligible to be claimed under section 80 G of the Act. ………………………… 14. In our view, expenditure incurred under section 30 to 36 are claimed while computing income under the head, „Income form Business and Profession”, where as monies spent under section 80G are claimed while computing „„Total Taxable income” in the hands of assessee. The point of claim under these provisions are different. Printed from counselvise.com 7 ITA No.1096/PUN/2025, AY 2020-21 15. Further, intention of legislature is very clear and unambiguous, since expenditure incurred under section 30 to 36 are excluded from Explanation 2 to section 37(1) of the Act, they are specifically excluded in clarification issued. There is no restriction on an expenditure being claimed under above sections to be exempt, as long as it satisfies necessary conditions under section 30 to 36 of the Act, for computing income under the head, “Income from Business and Profession”. 16. For claiming benefit under section 80G, deductions are considered at the stage of computing “Total taxable income”. Even if any payments under section 80G forms part of CSR payments ( keeping in mind ineligible deduction expressly provided u/s.80G), the same would already stand excluded while computing, Income under the head, “Income form Business and Profession\". The effect of such disallowance would lead to increase in Business income. Thereafter benefit accruing to assessee under Chapter VIA for computing “Total Taxable Income” cannot be denied to assessee, subject to fulfillment of necessary conditions therein. 17. We therefore do not agree with arguments advanced by Ld.Sr.DR. 18. In present facts of case, Ld.AR submitted that all payments forming part of CSR does not form part of profit and loss account for computing Income under the head, “Income from Business and Profession”. It has been submitted that some payments forming part of CSR were claimed as deduction under section 80G of the Act, for computing “Total taxable income”, which has been disallowed by authorities below. In our view, assessee cannot be denied the benefit of claim under Chapter VI A, which is considered for computing „Total Taxable Income”. If assessee is denied this benefit, merely because such payment forms part of CSR, would lead to double disallowance, which is not the intention of Legislature. 19. On the basis of above discussion, in our view, authorities below have erred in denying claim of assessee under section 80G of the Act. We also note that authorities below have not verified nature of payments qualifying exemption under section 80G of the Act and quantum of eligibility as per section 80G(1) of the Act. 20. Under such circumstances, we are remitting the issue back to Ld.AO for verifying conditions necessary to claim deduction under section 80G of the Act. Assessee is directed to file all requisite details in order to substantiate its claim before Ld.AO. Ld.AO is then directed to grant deduction to the extent of eligibility. Accordingly grounds raised by assessee stands allowed for statistical purposes. In the result appeal filed by assessee stands allowed.\" In view of the above facts and respectfully following the decision of Hon‟ble ITAT Bangalore in the case of Allegi Services (India) Pvt Ltd (supra), I am of the considered view that the appellant is entitled to claim deduction u/s 80G with respect to the donations forming part of CSR expenses. However, in this regard, I direct the AO to verify whether the Appellant satisfies the requisite conditions prescribed for deduction u/s 80G. In case it satisfies the conditions for deduction u/s 80G, the claim of Rs. 4,55,13,521/- has to be allowed. If found contrary, the stand of the AO stands confirmed. The AO is directed to give effect by passing a speaking order. The Appellant is directed to Printed from counselvise.com 8 ITA No.1096/PUN/2025, AY 2020-21 furnish all relevant details online before the AO for verification. Ground is, thus, allowed for statistical purpose.” 4. Mr. Murkunde vehemently argued in favour of the Revenue‟s pleadings that the Ld. CIT(A)'s herein has erred in law and on facts in accepting the assessee‟s sec.80G deduction claim of Rs.4,55,13,521/- qua “CSR expenditure” not exigible for relief u/sec.37 of the Act. 5. The assessee has drawn strong support from Ld. CIT(A)'s above extracted detailed discussion. 6. We have given our thoughtful consideration to the foregoing rival stands and find no merit in the Revenue‟s instant sole substantive grievance. Suffice to say, the Revenue‟s only argument is that once the impugned expenditure is not allowable u/sec.37 of the Act; the same is also not exigible to sec.80G deduction as well. We find no substance in Revenue‟s instant sole substantive grievance as the Ld. CIT(A)'s detailed discussion has considered a catena of case law of various judicial forums (supra) already accepting the very issue in assessee‟s favour and against the department. We thus adopt judicial consistency herein as well to uphold the Ld. CIT(A)'s detailed discussion accepting the assessee‟s sec.80G deduction claim. Rejected accordingly.” 9. Respectfully following the decision of the Co-ordinate Bench of Pune Tribunal in the case of Credit Suisse Services (India) Private Limited (supra) and in the absence of any contrary material brought on record by the Revenue to take a different view, we set aside the order of Ld. CIT(A) on the issue and allow the appeal of the assessee.” 9. In the case of Dana Anand India (P.) Ltd. (supra), the Co-ordinate Bench of the Pune Tribunal held as under : “6. The first issue raised by the assessee in grounds of appeal is regarding the disallowance of deduction u/s 80G of the Act qua the CSR expenditure of Rs.1,57,55,750/-. 7. After hearing both sides we find the assessee made CSR expenditure to the extent of Rs.1,57,55,750/- which was disallowed by him in the computation of income u/s 37(1) of the Act. However, the assessee claimed the same as deduction u/s 80G of the Act which was not allowed by the Assessing Officer and the DRP upheld the action of the Assessing Officer. 8. We find the Pune Bench of the Tribunal in the case of Advik Hi Tech (P.) Ltd. vs. DCIT (2024) 168 taxmann.com 587 (Pune-Trib.) has held that the deduction claimed by the assessee u/s 80G on account of Corporate Social Responsibility (CSR) deserves to be allowed. The relevant observations of the Tribunal read as under: “8. We have heard the Ld. Representatives of the parties and perused the records. The facts are not in dispute. We find that an identical issue came up for consideration before the Co-ordinate Bench of Pune Tribunal in the case of Credit Suisse Services (India) Private Limited (supra) wherein the Tribunal dismissed the appeal of the Revenue relying on the decision of the ITAT Bangalore in the case of Allegi Services (India) Pvt. Ltd. V. ACIT in ITA No. 1693/Bangalore/2019 wherein it was held that the assessee is entitled to claim deduction u/s 80G with respect to donations forming part of CSR expenses. The relevant observations and findings of the Coordinate Bench of Pune Tribunal in the case of Credit Suisse Services (India) Private Limited (supra) are as under : Printed from counselvise.com 9 ITA No.1096/PUN/2025, AY 2020-21 “3. Both the learned representatives next invited our attention to the CIT(A)'s impugned detailed discussion allowing the assessee‟s sec.80G deduction claim as under : “5. Decision I have carefully perused grounds of appeal, facts of the case, submissions made by the Appellant, assessment order and other evidences on records. 5.1. Ground 1 Vide this Ground, the Appellant has challenged action of the AO in making the disallowance of Rs.4,55,13,521/- u/s 80G with respect to the donations forming part of Corporate Social Responsibility („CSR‟). In this regard, the Appellant has submitted that : • The amount paid to various funds is without any consideration in return and is in the nature of irrevocable contribution. Thus, such contributions partake the character of donation • Since, all other requisite conditions under section 80G have been satisfied and not in dispute, the Appellant is eligible for deduction under section 80G of the Act. The institution to whom the Donations are made are duly registered under section 80G(5) of the Act • The CSR expenditure is not allowed only for the purpose of section 37 for computing business income. If such expenditure is otherwise allowable as deduction under other provisions of the Act, the same cannot be disturbed. • The donations/expenditure made by the Appellant is towards women empowerment, education, environmental research etc. and forms part of CSR expenditure as per Schedule VII of the Companies Act, 2013. • The legislature has restricted the benefit only in two specific cases being „Swachh Bharat Kosh‟ („SBK‟) and „Clean Ganga Fund‟ („CGF‟) as per subclause (iiihk) and (iiihl) of section 80G(2)(a) of the Act, thereby implying that CSR contribution to other eligible institution qualifies for deduction under section 80G of the Act. The Appellant has made CSR contribution to funds other than SBK and CGF, thus, claim under section 80G of the Act shall be allowed. • The said claim, as discussed above, is supported by the Explanatory Memorandum to Finance Bill 2014 with restriction placed only in relation to specified funds under section 80G, clarification issued by MCA and multiple favourable decisions. I have considered the submissions made by the Appellant. I find that the issue is covered in favour of the Appellant by various decisions of Hon‟ble Tribunals. I find that Hon‟ble ITAT Bangalore in the case of Allegi Services (India) Pvt Ltd vs ACIT, (ITA No.1693/Bangalore/2019) has decided this issue in favour of the assessee. Relevant part of the said decision is reproduced as under : “Brief facts of the case are as under: 2. Assessee is a company and filed its return of income on 30/11/2016 declaring income of Rs.73,44,38,310/-. The case was selected for scrutiny and notice under section 143 (2) and 142 (1) Printed from counselvise.com 10 ITA No.1096/PUN/2025, AY 2020-21 along with questionnaire was issued to assessee. In response to statutory notices, representative of assessee appeared before Ld.AO and filed requisite details as called for. 3. Ld.AO from the details furnished by assessee observed that assessee claimed deduction amounting to Rs.8,40,000/- under section 80 G of the Act, towards donation paid. Ld.AO was of the opinion that claim made under section 80 G of the Act, was not allowable as the amount was forming part of CSR expenses debited to profit and loss account. Ld.AO was of the opinion that donation made outside CSR expenses was only eligible to be claimed under section 80 G of the Act. ………………………… 14. In our view, expenditure incurred under section 30 to 36 are claimed while computing income under the head, „Income form Business and Profession”, where as monies spent under section 80G are claimed while computing „„Total Taxable income” in the hands of assessee. The point of claim under these provisions are different. 15. Further, intention of legislature is very clear and unambiguous, since expenditure incurred under section 30 to 36 are excluded from Explanation 2 to section 37(1) of the Act, they are specifically excluded in clarification issued. There is no restriction on an expenditure being claimed under above sections to be exempt, as long as it satisfies necessary conditions under section 30 to 36 of the Act, for computing income under the head, “Income from Business and Profession”. 16. For claiming benefit under section 80G, deductions are considered at the stage of computing “Total taxable income”. Even if any payments under section 80G forms part of CSR payments ( keeping in mind ineligible deduction expressly provided u/s.80G), the same would already stand excluded while computing, Income under the head, “Income form Business and Profession\". The effect of such disallowance would lead to increase in Business income. Thereafter benefit accruing to assessee under Chapter VIA for computing “Total Taxable Income” cannot be denied to assessee, subject to fulfillment of necessary conditions therein. 17. We therefore do not agree with arguments advanced by Ld. Sr. DR. 18. In present facts of case, Ld.AR submitted that all payments forming part of CSR does not form part of profit and loss account for computing Income under the head, “Income from Business and Profession”. It has been submitted that some payments forming part of CSR were claimed as deduction under section 80G of the Act, for computing “Total taxable income”, which has been disallowed by authorities below. In our view, assessee cannot be denied the benefit of claim under Chapter VI A, which is considered for computing „Total Taxable Income”. If assessee is denied this benefit, merely because such payment forms part of CSR, would lead to double disallowance, which is not the intention of Legislature. 19. On the basis of above discussion, in our view, authorities below have erred in denying claim of assessee under section 80G of the Act. We also note that authorities below have not verified nature of payments qualifying exemption under section 80G of the Act and quantum of eligibility as per section 80G(1) of the Act. 20. Under such circumstances, we are remitting the issue back to Ld.AO for verifying conditions necessary to claim deduction under Printed from counselvise.com 11 ITA No.1096/PUN/2025, AY 2020-21 section 80G of the Act. Assessee is directed to file all requisite details in order to substantiate its claim before Ld.AO. Ld.AO is then directed to grant deduction to the extent of eligibility. Accordingly grounds raised by assessee stands allowed for statistical purposes. In the result appeal filed by assessee stands allowed.\" In view of the above facts and respectfully following the decision of Hon‟ble ITAT Bangalore in the case of Allegi Services (India) Pvt Ltd (supra), I am of the considered view that the appellant is entitled to claim deduction u/s 80G with respect to the donations forming part of CSR expenses. However, in this regard, I direct the AO to verify whether the Appellant satisfies the requisite conditions prescribed for deduction u/s 80G. In case it satisfies the conditions for deduction u/s 80G, the claim of Rs. 4,55,13,521/- has to be allowed. If found contrary, the stand of the AO stands confirmed. The AO is directed to give effect by passing a speaking order. The Appellant is directed to furnish all relevant details online before the AO for verification. Ground is, thus, allowed for statistical purpose.” 4. Mr. Murkunde vehemently argued in favour of the Revenue‟s pleadings that the Ld. CIT(A)'s herein has erred in law and on facts in accepting the assessee‟s sec.80G deduction claim of Rs.4,55,13,521/- qua “CSR expenditure” not exigible for relief u/sec.37 of the Act. 5. The assessee has drawn strong support from Ld. CIT(A)'s above extracted detailed discussion. 6. We have given our thoughtful consideration to the foregoing rival stands and find no merit in the Revenue‟s instant sole substantive grievance. Suffice to say, the Revenue‟s only argument is that once the impugned expenditure is not allowable u/sec.37 of the Act; the same is also not exigible to sec.80G deduction as well. We find no substance in Revenue‟s instant sole substantive grievance as the Ld. CIT(A)'s detailed discussion has considered a catena of case law of various judicial forums (supra) already accepting the very issue in assessee‟s favour and against the department. We thus adopt judicial consistency herein as well to uphold the Ld. CIT(A)'s detailed discussion accepting the assessee‟s sec.80G deduction claim. Rejected accordingly.” 9. Respectfully following the decision of the Co-ordinate Bench of Pune Tribunal in the case of Credit Suisse Services (India) Private Limited (supra) and in the absence of any contrary material brought on record by the Revenue to take a different view, we set aside the order of Ld. CIT(A) on the issue and allow the appeal of the assessee.” 9. Respectfully following the decision of the Co-ordinate Bench of the Tribunal in the case of Advik Hi Tech (P.) Ltd. vs. DCIT (supra) which in turn has followed the decision of the Tribunal in the case of DCIT Vs. Credit Suisse Services (India) Private Limited vide ITA No.44/PUN/2024 order dated 15.05.2024 for assessment year 2020-21 and in absence of any contrary material brought to our notice by the Ld. DR, we hold that the Assessing Officer is not justified in denying the claim of deduction u/s 80G of the Act. We, therefore, direct the Assessing Officer to allow the benefit of deduction u/s 80G of the Act. The first issue raised by the assessee in the grounds of appeal is accordingly allowed.” 10. Respectfully following the decision in the case of Advik Hi Tech Pvt. Ltd. (supra) as well as several other decisions (supra) of the Co-ordinate Printed from counselvise.com 12 ITA No.1096/PUN/2025, AY 2020-21 Bench(es) of the Tribunal and in the absence of any contrary material brought to our notice by the Ld. DR to enable us to take a different view, we do not find any reason to interfere with the findings of the Ld. CIT(A)/NFAC. The grounds raised by the Revenue are accordingly dismissed. 11. In the result, the appeal of the Revenue is dismissed. Order pronounced in the open court on 09th December, 2025. Sd/- Sd/- (R.K. Panda) (Astha Chandra) VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; दिन ांक / Dated : 09th December, 2025. रदि आदेश की प्रधिधलधप अग्रेधर्ि / Copy of the Order forwarded to : 1. अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT concerned. 4. दिभ गीय प्रदिदनदि, आयकर अपीलीय अदिकरण, “ए” बेंच, पुणे / DR, ITAT, “A” Bench, Pune. 5. ग र्ड फ़ इल / Guard File. //सत्य दपि प्रदि// True Copy// आिेश नुस र / BY ORDER, सहायक पंजीकार/ Assistant Registrar आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune Printed from counselvise.com "
Other Referred Cases
Cheil India (P.) Ltd. vs. DCIT, L&T Finance Ltd. vs. DCIT, Interglobe Technology Quotient (P.) Ltd. vs. ACIT, Ericsson India Global Services (P.) Ltd. vs. DCIT, Power Mech Projects Ltd. vs. DCIT, Optum Global Solutions (India) (P.) Ltd. vs. DCIT, Honda Motorcycle and Scooter India (P.) Ltd. vs. ACIT, Teradata India (P.) Ltd. v. DCIT, P.C. Chandra Holding (P.) Ltd. v. Pr.CIT, JMS Mining (P.) Ltd. v. Pr. CIT, NaikSeafoods (P.) Ltd. v. Pr. CIT, FNF India (P.) Ltd. v. Asstt. CIT, First American (India) Pvt. Ltd. v. Assistant Commissioner of Income Tax
Laws Referred To
Income Tax Act, 1961
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