JEEVANDEEP EDUMEDIA PRIVATE LIMITED,MUMBAI V. PRINCIPLE CIT-6, MUMBAI

ITA 2517/MUM/2025

AI Insights

The case involves Jeevandeep Edumedia Pvt. Ltd., which appealed against the revision order passed by the PCIT under Section 263 of the Income Tax Act, 1961. The revision was based on the grounds that the original assessment order was erroneous and prejudicial to the interests of the Revenue, particularly concerning the deduction claimed under Section 80G for CSR expenditures. The Tribunal examined whether the PCIT was justified in revising the assessment order and whether the Assessing Officer had adequately addressed the issues during the original assessment. The Tribunal concluded that the PCIT's order was not sustainable as the original assessment had been made after proper inquiry and was a plausible view taken by the Assessing Officer.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 708490 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-07-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2020-2021
• Other Referred Cases: Goldman Sachs Services Pvt. Ltd. v. JCIT, Agilent Technologies (International) (P.) Ltd. v. ACIT, First American (India) Pvt. Ltd. v. ACIT, Allegis Services India Pvt. Ltd. v. ACIT, Naik Seafoods Pvt. Ltd. v. ACIT, Ericsson India Global Services Pvt. Ltd. v. ACIT, Malabar Industrial Co. Ltd. v. CIT, Nandi Steels Ltd v. CIT, FDC Ltd. v. PCIT, Dalal and Broacha Stock Broking Pvt. Ltd. v. Pr. CIT, NTT Global Networks Pvt. Ltd. v. PCIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIVEK PERAMPURNA
• Assessee Lawyers: SANJAY PARIKH
• Keywords: Set aside; Business income; Difference of opinion; Change of opinion; Opportunity of being heard; Reassessment proceedings; Business expenditure; Audit objection; Assessment record; Charitable institution; Revision of order
• Section: 143(3); 142(1); 263; 12A; 37; 37(1); 80G

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “F” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND MS. KAVITHA RAJAGOPAL (JUDICIAL MEMBER) ITA No. 2517/MUM/2025 Assessment Year: 2020-21 Jeevandeep Edumedia Pvt. Ltd., 1st floor, Sun Paradise Business Plaza, Senapati Bapat Marg, Lower Parel (West), Mumbai-400013. Vs. Pr. CIT-6, 501,5th floor, Aayakar Bhavan, Maharishi Karve Road, Mumbai-400020. PAN NO. AABCJ 0180 G Appellant Respondent Assessee by : Mr. Sanjay Parikh Revenue by : Mr. Vivek Perampurna, CIT-DR Date of Hearing : 09/07/2025 Date of pronouncement : 17/07/2025 ORDER PER OM PRAKASH KANT, AM This appeal by the assessee is directed against revision order dated 17.03.2025 passed by the learned Principal Commissioner of Income Tax, Mumbai-6 (hereinafter referred to as ‘the ld. PCIT’), whereby the assessment order passed by the Assessment Unit of the Income Tax Department for the assessment year 2020-21 was held to be erroneous in so far as prejudicial to the interest of the Revenue. The grounds raised by the assessee under: Ground No.1: Validity of Order u/s 263 of the Income Tax Act, 1961 1. The learned PCIT erred in facts and circumstances of the case and law, by passing the revision order u/s 263 of the Income Tax Act, 1961 dated 17.03.2025, whereby the assessment order dated 09.09.2022 (on disallowance of donation claimed u/s 80G of the Income Tax Act amounting to Rs.12,49,000/ application of mind and proper inquiries. 2. The learned PCIT failed to appreciate that the issue regarding deduction under section 80G in respect of donations made by the appellant, including those forming part of CSR obligation, was specifically raised by the Assessing Officer during assessment proceedings and was duly responded to and examined before finalizing the assessment. 3. On the facts and circumstances of the case and in law the learned PCIT erred on facts and in law in exercisin section 263 of the Acton various issues in the impugned order, without satisfying the twin jurisdictional conditions of the assessment order being: (a) erroneous; and (b) prejudicial to the interests of the Revenue and consequently, the impugned order is illegal, bad in law and liable to be quashed. 4. The learned PCIT erred in facts and in law by enhancing/ setting aside the assessment order by exercising powers undersection 263 of the Act, without appreciating that: a. It was not a case of lack of enquiry as the assessing officer during the course of assessment proceedings has duly verified the same; b. The view taken by the assessing officer in respect of the 80G Donation Deduction was, in any case, a plausible view; and c. Revisionary proceedings could not be initiated on a merely on the basis of 'change of opinion'. 5. The learned PCIT erred in facts and in law by setting aside the assessment order, without even recording any prima facie findings on merits, thereby, not demonst order was erroneous and prejudicial to the interests of the Revenue. Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 The grounds raised by the assessee are Ground No.1: Validity of Order u/s 263 of the Income Tax Act, 1961 1. The learned PCIT erred in facts and circumstances of the case and law, by passing the revision order u/s 263 of the Income Tax Act, 1961 dated 17.03.2025, whereby the assessment order dated 09.09.2022 (on disallowance of donation claimed u/s 80G of the Income Tax Act amounting to Rs.12,49,000/-) which was passed u/s 143(3) after due application of mind and proper inquiries. 2. The learned PCIT failed to appreciate that the issue regarding deduction under section 80G in respect of donations made by the appellant, including those forming part of CSR obligation, was ifically raised by the Assessing Officer during assessment proceedings and was duly responded to and examined before finalizing 3. On the facts and circumstances of the case and in law the learned PCIT erred on facts and in law in exercising revisionary powers under section 263 of the Acton various issues in the impugned order, without satisfying the twin jurisdictional conditions of the assessment order being: (a) erroneous; and (b) prejudicial to the interests of the Revenue ly, the impugned order is illegal, bad in law and liable to 4. The learned PCIT erred in facts and in law by enhancing/ setting aside the assessment order by exercising powers undersection 263 of the Act, without appreciating that: t a case of lack of enquiry as the assessing officer during the course of assessment proceedings has duly verified the same; b. The view taken by the assessing officer in respect of the 80G Donation Deduction was, in any case, a plausible view; and sionary proceedings could not be initiated on a merely on the basis of 'change of opinion'. 5. The learned PCIT erred in facts and in law by setting aside the assessment order, without even recording any prima facie findings on merits, thereby, not demonstrating how and why the final assessment order was erroneous and prejudicial to the interests of the Revenue. Jeevandeep Edumedia Pvt. Ltd. 2 ITA No. 2517/MUM/2025 are reproduced as Ground No.1: Validity of Order u/s 263 of the Income Tax Act, 1961 1. The learned PCIT erred in facts and circumstances of the case and in law, by passing the revision order u/s 263 of the Income Tax Act, 1961 dated 17.03.2025, whereby the assessment order dated 09.09.2022 (on disallowance of donation claimed u/s 80G of the Income Tax Act 143(3) after due 2. The learned PCIT failed to appreciate that the issue regarding deduction under section 80G in respect of donations made by the appellant, including those forming part of CSR obligation, was ifically raised by the Assessing Officer during assessment proceedings and was duly responded to and examined before finalizing 3. On the facts and circumstances of the case and in law the learned g revisionary powers under section 263 of the Acton various issues in the impugned order, without satisfying the twin jurisdictional conditions of the assessment order being: (a) erroneous; and (b) prejudicial to the interests of the Revenue ly, the impugned order is illegal, bad in law and liable to 4. The learned PCIT erred in facts and in law by enhancing/ setting aside the assessment order by exercising powers undersection 263 of t a case of lack of enquiry as the assessing officer during the course of assessment proceedings has duly verified the same; b. The view taken by the assessing officer in respect of the 80G sionary proceedings could not be initiated on a merely on the 5. The learned PCIT erred in facts and in law by setting aside the assessment order, without even recording any prima facie findings on rating how and why the final assessment order was erroneous and prejudicial to the interests of the Revenue. 6. The learned PCIT erred in facts by holding that the assessment order was \"erroneous and prejudicial to the interests of revenue\" merely because he disagreed with the view taken by the Assessing Officer, without demonstrating how the order violated Explanation 2 to Section 263. Ground No. 2: Incorrect disallowance of donation claimed u/s 80G of Rs. 12,49,000/- as it s forms part of CSR Expenditure 1. The learned PCIT erred in facts and in law by disallowing the deduction of Rs.12,49,000/ 2. On the facts and circumstances of the case and in law the learned PCIT erred in disallowing the deduction of donation paid and accordance with the provisions of section 80G of Income tax Act of Rs.12,49,000/-, based on assumptions and surmises. 3. The learned PCIT grossly erred in disallowing the deduction of donation claimed under section 80G of the IT Act of Rs.12,49 without appreciating the fact that donation paid is eligible for deduction under the express provisions of section 80G of the IT Act and were made to entities which are duly registered u/s 12A of the Income Tax Ac. 4. Further, The learned PCIT also that the deductions claimed u/s 80G of the Act pertained to eligible payments specified under section 80G of the Act. 5. The learned PCIT failed to appreciate the fact that your Appellant has correctly disallowed the C computing the business income and claimed deduction of Rs. 12,49,000 u/s 80G of the Act which falls under Chapter VIA wherein there is no such restriction. 6. The learned PCIT erred in holding that deduction under sec not allowable for donations made in fulfillment of CSR obligations under section 135 of the Companies Act, 2013, thereby ignoring various judicial precedents wherein such deduction has been upheld, inter alia: a. Naik Seafoods Pvt. Ltd. (ITA No b. Allegis Services India Pvt. Ltd. (ITA No. 1693/Bang/2019) c. Goldman Sachs Services Pvt. Ltd. (ITA No. 2355/Bang/2019) d. Ericsson India Global Services Pvt. Ltd. (160 taxmann.com 599 Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 6. The learned PCIT erred in facts by holding that the assessment order was \"erroneous and prejudicial to the interests of revenue\" merely he disagreed with the view taken by the Assessing Officer, without demonstrating how the order violated Explanation 2 to Section Ground No. 2: Incorrect disallowance of donation claimed u/s 80G of as it s forms part of CSR Expenditure 1. The learned PCIT erred in facts and in law by disallowing the deduction of Rs.12,49,000/- under section 80G of the IT Act. 2. On the facts and circumstances of the case and in law the learned PCIT erred in disallowing the deduction of donation paid and accordance with the provisions of section 80G of Income tax Act of , based on assumptions and surmises. 3. The learned PCIT grossly erred in disallowing the deduction of donation claimed under section 80G of the IT Act of Rs.12,49 without appreciating the fact that donation paid is eligible for deduction under the express provisions of section 80G of the IT Act and were made to entities which are duly registered u/s 12A of the Income Tax 4. Further, The learned PCIT also erred in law by disregarding the fact that the deductions claimed u/s 80G of the Act pertained to eligible payments specified under section 80G of the Act. 5. The learned PCIT failed to appreciate the fact that your Appellant has correctly disallowed the CSR expenses u/s 37(1) of the Act while computing the business income and claimed deduction of Rs. 12,49,000 u/s 80G of the Act which falls under Chapter VIA wherein there is no 6. The learned PCIT erred in holding that deduction under sec not allowable for donations made in fulfillment of CSR obligations under section 135 of the Companies Act, 2013, thereby ignoring various judicial precedents wherein such deduction has been upheld, inter alia: a. Naik Seafoods Pvt. Ltd. (ITA No. 490/Mum/2021) b. Allegis Services India Pvt. Ltd. (ITA No. 1693/Bang/2019) c. Goldman Sachs Services Pvt. Ltd. (ITA No. 2355/Bang/2019) d. Ericsson India Global Services Pvt. Ltd. (160 taxmann.com 599 Jeevandeep Edumedia Pvt. Ltd. 3 ITA No. 2517/MUM/2025 6. The learned PCIT erred in facts by holding that the assessment order was \"erroneous and prejudicial to the interests of revenue\" merely he disagreed with the view taken by the Assessing Officer, without demonstrating how the order violated Explanation 2 to Section Ground No. 2: Incorrect disallowance of donation claimed u/s 80G of 1. The learned PCIT erred in facts and in law by disallowing the 2. On the facts and circumstances of the case and in law the learned PCIT erred in disallowing the deduction of donation paid and claimed in accordance with the provisions of section 80G of Income tax Act of 3. The learned PCIT grossly erred in disallowing the deduction of donation claimed under section 80G of the IT Act of Rs.12,49,000/- without appreciating the fact that donation paid is eligible for deduction under the express provisions of section 80G of the IT Act and were made to entities which are duly registered u/s 12A of the Income Tax erred in law by disregarding the fact that the deductions claimed u/s 80G of the Act pertained to eligible 5. The learned PCIT failed to appreciate the fact that your Appellant has SR expenses u/s 37(1) of the Act while computing the business income and claimed deduction of Rs. 12,49,000 u/s 80G of the Act which falls under Chapter VIA wherein there is no 6. The learned PCIT erred in holding that deduction under section 80G is not allowable for donations made in fulfillment of CSR obligations under section 135 of the Companies Act, 2013, thereby ignoring various judicial precedents wherein such deduction has been upheld, inter alia: c. Goldman Sachs Services Pvt. Ltd. (ITA No. 2355/Bang/2019) d. Ericsson India Global Services Pvt. Ltd. (160 taxmann.com 599 7. The learned PCIT erred in holding that the natur obligation ipso facto disqualifies the assessee from claiming deduction under section 80G, despite absence of any express bar in the statutory text, other than the two exclusions under Section 80G(2)(a)(iiihk) and (iiihl). 8. On the facts and PCIT erred in law by claiming that Circular issued by Central Board of Direct Tax is binding on taxpayer. 9. Your Appellant prays that the disallowance made in the impugned order is invalid and bad in law an please be deleted. 2. Briefly stated, facts of the case are that during the relevant year, the assessee company was engaged in the business of publishing, printing and reproduction of recorded media. The assessee filed its return of income for the year under consideration on 06.01.2021 declaring total income at Rs.17,07,84,200/ 2.1 The return of income filed by the assessee was selected for scrutiny and statutory notices under the Income short ‘the Act’) were issued and complied with. The assessment was subsequently completed wherein the returned income of the assessee was accepted. Subsequently, in view of raised by the internal audit wing, t and after examination, he was of the opinion that assessment orde was erroneous in so far as prejudicial particularly, with respect to the Act for the corporate social responsibility (CSR) expenses to the extent of Rs.24,98,000/ to section 263 of the Act, which deems an order as erroneous where Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 7. The learned PCIT erred in holding that the nature of the CSR obligation ipso facto disqualifies the assessee from claiming deduction under section 80G, despite absence of any express bar in the statutory text, other than the two exclusions under Section 80G(2)(a)(iiihk) and 8. On the facts and circumstances of the case and in law the learned PCIT erred in law by claiming that Circular issued by Central Board of Direct Tax is binding on taxpayer. 9. Your Appellant prays that the disallowance made in the impugned order is invalid and bad in law and facts and hence the same may Briefly stated, facts of the case are that during the relevant year, the assessee company was engaged in the business of publishing, printing and reproduction of recorded media. The assessee filed its return of income for the year under consideration .01.2021 declaring total income at Rs.17,07,84,200/ The return of income filed by the assessee was selected for scrutiny and statutory notices under the Income-tax Act, 1961 (in short ‘the Act’) were issued and complied with. The assessment was equently completed wherein the returned income of the assessee was accepted. Subsequently, in view of an sed by the internal audit wing, the Ld. PCIT called for the record and after examination, he was of the opinion that assessment orde was erroneous in so far as prejudicial to the interest of the Revenue, articularly, with respect to the claim of deduction u/s 80G of the Act for the corporate social responsibility (CSR) expenses to the extent of Rs.24,98,000/-. The learned PCIT, invoking Explanation 2 to section 263 of the Act, which deems an order as erroneous where Jeevandeep Edumedia Pvt. Ltd. 4 ITA No. 2517/MUM/2025 e of the CSR obligation ipso facto disqualifies the assessee from claiming deduction under section 80G, despite absence of any express bar in the statutory text, other than the two exclusions under Section 80G(2)(a)(iiihk) and circumstances of the case and in law the learned PCIT erred in law by claiming that Circular issued by Central Board of 9. Your Appellant prays that the disallowance made in the impugned d facts and hence the same may Briefly stated, facts of the case are that during the relevant year, the assessee company was engaged in the business of publishing, printing and reproduction of recorded media. The assessee filed its return of income for the year under consideration .01.2021 declaring total income at Rs.17,07,84,200/-. The return of income filed by the assessee was selected for tax Act, 1961 (in short ‘the Act’) were issued and complied with. The assessment was equently completed wherein the returned income of the an audit objection he Ld. PCIT called for the record and after examination, he was of the opinion that assessment order to the interest of the Revenue, of deduction u/s 80G of the Act for the corporate social responsibility (CSR) expenses to the ing Explanation 2 to section 263 of the Act, which deems an order as erroneous where there is a lack of enquiry or inadequate enquiry, issued a show cause notice under section 263 of the Act. 2.3 In response, the assessee submitted that the Assessing Offic had indeed examined the allowability of the CSR expenditure under section 80G and had allowed the same after due consideration of the judicial precedents relied upon by the assessee, including certain decisions of the Income the learned PCIT was not persuaded by the explanation furnished. He was of the view that CSR expenditure, being a statutory obligation under section 135 of the Companies Act, 2013, lacks the element of voluntariness donation eligible for deduction under section 80G support of this view, the learned PCIT placed reliance on the judgment of the Hon’ble Supreme Court in Commissioner of Expenditure Tax v. P.V.G. Raju of Vizianagaram [(1967) 1 SCR 1017], wherein it was held that only voluntary contributions qualify as donations. The Ld. PCIT also referred to the Circular No. 1/2016 issued by the Ministry of Corporate Affairs on 12.01.2016 clarifies that CSR expenditure does not enjoy any specif exemption under the Act. The learned PCIT also decision of the Tribunal relied upon by the assessee and on the contrary he relied on the decision of the Delhi Bench of the Tribunal in the case of Agilent Technologies (International (2024) 160 taxmann.com 238 (Delhi Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 there is a lack of enquiry or inadequate enquiry, issued a show cause notice under section 263 of the Act. In response, the assessee submitted that the Assessing Offic had indeed examined the allowability of the CSR expenditure under section 80G and had allowed the same after due consideration of the judicial precedents relied upon by the assessee, including certain decisions of the Income-tax Appellate Tribunal. Howe the learned PCIT was not persuaded by the explanation furnished. He was of the view that CSR expenditure, being a statutory obligation under section 135 of the Companies Act, 2013, lacks the element of voluntariness, which is a sine qua non for qualif donation eligible for deduction under section 80G support of this view, the learned PCIT placed reliance on the judgment of the Hon’ble Supreme Court in Commissioner of Expenditure Tax v. P.V.G. Raju of Vizianagaram [(1967) 1 SCR 017], wherein it was held that only voluntary contributions qualify The Ld. PCIT also referred to the Circular No. 1/2016 issued by the Ministry of Corporate Affairs on 12.01.2016 clarifies that CSR expenditure does not enjoy any specif exemption under the Act. The learned PCIT also distinguished the decision of the Tribunal relied upon by the assessee and on the contrary he relied on the decision of the Delhi Bench of the Tribunal in the case of Agilent Technologies (International) (P.) Ltd. v. ACIT (2024) 160 taxmann.com 238 (Delhi-Trib.). The Ld. PCIT also Jeevandeep Edumedia Pvt. Ltd. 5 ITA No. 2517/MUM/2025 there is a lack of enquiry or inadequate enquiry, issued a show In response, the assessee submitted that the Assessing Officer had indeed examined the allowability of the CSR expenditure under section 80G and had allowed the same after due consideration of the judicial precedents relied upon by the assessee, including tax Appellate Tribunal. However, the learned PCIT was not persuaded by the explanation furnished. He was of the view that CSR expenditure, being a statutory obligation under section 135 of the Companies Act, 2013, lacks the is a sine qua non for qualifying as a donation eligible for deduction under section 80G of the Act. In support of this view, the learned PCIT placed reliance on the judgment of the Hon’ble Supreme Court in Commissioner of Expenditure Tax v. P.V.G. Raju of Vizianagaram [(1967) 1 SCR 017], wherein it was held that only voluntary contributions qualify The Ld. PCIT also referred to the Circular No. 1/2016 issued by the Ministry of Corporate Affairs on 12.01.2016 which clarifies that CSR expenditure does not enjoy any specific tax distinguished the decision of the Tribunal relied upon by the assessee and on the contrary he relied on the decision of the Delhi Bench of the Tribunal ) (P.) Ltd. v. ACIT Trib.). The Ld. PCIT also drew attention to the specific exclusions contained in section 80G in respect of contributions to certain CSR ‘Swachh Bharat Kosh’ and the ‘Clean Ganga Fund’, to bolster his conclusion that CSR expenses are not deductible under the sai provision. Accordingly, erroneous insofar as prejudicial to the interest of the revenue observing as under: 6.5 The decision of the Assessing Officer in the instant case is erroneous on merits as well as the fac further enquiries, when facts on record. per se justified and mandated further inquiry or investigation. Furthermore, the submissions of the assessee are not acceptable in view of the Finance Bill, 2014 vide which the concept of Responsibility was introduced. The intent of the legislature itself was that the Corporates share the burden of the Government in providing social services, the extract of which is reproduced here under; \"Under the Companies Act, 2013 cer have net worth of Rs.500 crore or more, or turnover of Rs. 1000 crore or more, or a net profit of Rs.5 crore or more during any financial year) are required to spend certain percentage of their profit on activities relating to Corpora Responsibility (CSR). Under the existing provisions of the Act expenditure incurred wholly and exclusively for the purposes of the business is only allowed as a deduction for computing taxable business income. CSR expenditure, being an applicatio 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, amount spent on CSR cannot be allowed as deduc income of the company. Moreover, the objective of CSR is to share burden of the Government in providing social services by companies having net worth/turnover/profit above a threshold. If such expenses are allowed as tax dedu would result in subsidizing of around one expenses by the Government by way of tax expenditure\". 6.6 Further, the Companies Act, 2013 mandates CSR spending as a statutory zzz obligation, not as a voluntary donation. Therefore: Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 attention to the specific exclusions contained in section 80G in respect of contributions to certain CSR-related funds such as the ‘Swachh Bharat Kosh’ and the ‘Clean Ganga Fund’, to bolster his conclusion that CSR expenses are not deductible under the sai Accordingly, the ld. PCIT, held the assessment order as erroneous insofar as prejudicial to the interest of the revenue 6.5 The decision of the Assessing Officer in the instant case is erroneous on merits as well as the fact that he has not conducted further enquiries, when facts on record. per se justified and mandated further inquiry or investigation. Furthermore, the submissions of the assessee are not acceptable in view of the Finance Bill, 2014 vide which the concept of Corporate Social Responsibility was introduced. The intent of the legislature itself was that the Corporates share the burden of the Government in providing social services, the extract of which is reproduced here under; \"Under the Companies Act, 2013 certain companies (which have net worth of Rs.500 crore or more, or turnover of Rs. 1000 crore or more, or a net profit of Rs.5 crore or more during any financial year) are required to spend certain percentage of their profit on activities relating to Corpora Responsibility (CSR). Under the existing provisions of the Act expenditure incurred wholly and exclusively for the purposes of the business is only allowed as a deduction for computing taxable business income. 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, amount spent on CSR cannot be allowed as deduction for computing the taxable income of the company. Moreover, the objective of CSR is to share burden of the Government in providing social services by companies having net worth/turnover/profit above a threshold. If such expenses are allowed as tax dedu would result in subsidizing of around one expenses by the Government by way of tax expenditure\". 6.6 Further, the Companies Act, 2013 mandates CSR spending as a statutory zzz obligation, not as a voluntary donation. Therefore: Jeevandeep Edumedia Pvt. Ltd. 6 ITA No. 2517/MUM/2025 attention to the specific exclusions contained in section 80G in related funds such as the ‘Swachh Bharat Kosh’ and the ‘Clean Ganga Fund’, to bolster his conclusion that CSR expenses are not deductible under the said PCIT, held the assessment order as erroneous insofar as prejudicial to the interest of the revenue 6.5 The decision of the Assessing Officer in the instant case is t that he has not conducted further enquiries, when facts on record. per se justified and mandated further inquiry or investigation. Furthermore, the submissions of the assessee are not acceptable in view of the Corporate Social Responsibility was introduced. The intent of the legislature itself was that the Corporates share the burden of the Government in providing social services, the extract of which is reproduced here under; tain companies (which have net worth of Rs.500 crore or more, or turnover of Rs. 1000 crore or more, or a net profit of Rs.5 crore or more during any financial year) are required to spend certain percentage of their profit on activities relating to Corporate Social Responsibility (CSR). Under the existing provisions of the Act expenditure incurred wholly and exclusively for the purposes of the business is only allowed as a deduction for computing taxable business income. CSR expenditure, being an n 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, amount spent on CSR tion for computing the taxable income of the company. Moreover, the objective of CSR is to share burden of the Government in providing social services by companies having net worth/turnover/profit above a threshold. If such expenses are allowed as tax deduction, this would result in subsidizing of around one-third of such expenses by the Government by way of tax expenditure\". 6.6 Further, the Companies Act, 2013 mandates CSR spending as a statutory zzz obligation, not as a voluntary donation. Therefore:  CSR expenses are not made out of free will but in compliance with statutory provisions.  Allowing deductions under Section 80G for CSR expenses would lead to double benefits deduction and again by fulfilling a statutory obligation.  Claim of deduction by the assessee with regard to CSR expenses and allowance of such expenditure will result into wastage of entire effort of the legislature to treat CSR expenditure as appropriation of profit after tax. It will be against the spirit of law a  The Income Tax Act, through Explanation 2 to Section 37(1), already disallows CSR expenses from business income, reinforcing the position that they do not qualify for deductions under other provisions. In view of the ab assessment order passed by the Assessing Officer u/s.143(3) r.w.s 144B of the Act dated 09.09.2022, is erroneous in so far as it is prejudicial to the interest of the revenue. Accordingly, the said assessment or issue of claim of deduction under section 80G of the Act of CSR expense amounting to Rs. 12,49,000/ an enquiry in this matter and re opportunity of being heard 3. Before us, the Ld. counsel for the assessee placed reliance on the Paper Book comprising pages 1 to 82 drawing our attention to page No. 51 of the Paper Book. He submitted that the Assessing Officer had raised a of CSR expenditure u/s 80G of the Act. The relevant query raised by the Assessing Officer is reproduced as under: 1. आयकर अͬधǓनयम Ǔनàनͧलͨखत खाते या दèतावेज या 1. The following accounts or documents or information is/are sought under section 142(1) of the Income Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 expenses are not made out of free will but in compliance with statutory provisions. Allowing deductions under Section 80G for CSR expenses would lead to double benefits-once by allowing it as a deduction and again by fulfilling a statutory obligation. im of deduction by the assessee with regard to CSR expenses and allowance of such expenditure will result into wastage of entire effort of the legislature to treat CSR expenditure as appropriation of profit after tax. It will be against the spirit of law and the intention of the legislature. The Income Tax Act, through Explanation 2 to Section 37(1), already disallows CSR expenses from business income, reinforcing the position that they do not qualify for deductions under other provisions. In view of the above, I am of the considered opinion that the assessment order passed by the Assessing Officer u/s.143(3) r.w.s 144B of the Act dated 09.09.2022, is erroneous in so far as it is prejudicial to the interest of the revenue. Accordingly, the said assessment order passed by the Assessing Officer is set issue of claim of deduction under section 80G of the Act of CSR expense amounting to Rs. 12,49,000/-. The AO is directed to make an enquiry in this matter and re-assess the income after giving an rtunity of being heard to the assessee.” Before us, the Ld. counsel for the assessee placed reliance on the Paper Book comprising pages 1 to 82 drawing our attention to page No. 51 of the Paper Book. He submitted that the Assessing Officer had raised a specific query in respect of claim of deduction of CSR expenditure u/s 80G of the Act. The relevant query raised by the Assessing Officer is reproduced as under: “अनुलÊनक ANNEXURE आयकर अͬधǓनयम, 1961 कȧ धारा 142 (1) Ǔनàनͧलͨखत खाते या दèतावेज या जानकारȣ मांगी गई है 1. The following accounts or documents or information is/are sought under section 142(1) of the Income-tax Act, 1961: Jeevandeep Edumedia Pvt. Ltd. 7 ITA No. 2517/MUM/2025 expenses are not made out of free will but in compliance Allowing deductions under Section 80G for CSR expenses once by allowing it as a deduction and again by fulfilling a statutory obligation. im of deduction by the assessee with regard to CSR expenses and allowance of such expenditure will result into wastage of entire effort of the legislature to treat CSR expenditure as appropriation of profit after tax. It will be nd the intention of the legislature. The Income Tax Act, through Explanation 2 to Section 37(1), already disallows CSR expenses from business income, reinforcing the position that they do not qualify for deductions ove, I am of the considered opinion that the assessment order passed by the Assessing Officer u/s.143(3) r.w.s 144B of the Act dated 09.09.2022, is erroneous in so far as it is prejudicial to the interest of the revenue. Accordingly, the said der passed by the Assessing Officer is set-aside on the issue of claim of deduction under section 80G of the Act of CSR . The AO is directed to make assess the income after giving an Before us, the Ld. counsel for the assessee placed reliance on the Paper Book comprising pages 1 to 82 drawing our attention to page No. 51 of the Paper Book. He submitted that the Assessing specific query in respect of claim of deduction of CSR expenditure u/s 80G of the Act. The relevant query raised 142 (1) क े तहत जानकारȣ मांगी गई है: 1. The following accounts or documents or information is/are tax Act, 1961: 1. You have claimed donations given on a/c of CSR expenditure of Rs.24,98,000/ disallowed in the ITR. However, the same donations are claimed u/s 80G of I.T.Act which is indirectly claiming the CSR expenditure which is not allowable u/s 37 (1) of I.T. this regard, please provide justification of your claim and also produce the objects donations and explain how such objects will fall into the category of CSR expenditure u/s 135 of 3.1 Further, the Ld. counsel referred a detailed reply filed before the Assessing Officer explaining the of whom deduction was claimed. In the said reply, the assessee also referred to the decision of the Bangalore Bench of the Tribunal in the case of First American (India) Pvt. Ltd. (supra) and Allegies Services (India) Pvt. Lt the deduction u/s 80G in respect of CSR expenditure. For ready reference the relevant reply filed by the assessee is reproduced as under: “To Deputy Commissioner of Income Tax, Central Circle 3(2), Room No 1913,1 Air India Building, Mumbai - 400021 Dear Sir, Ref: Jeevandeep Edumedia Private Limited PAN: AABCJ0180G DIN: ITBA/AST/F/142(l)/2022 Sub: Reassessment proceedings for the assessment year 2020-21 With reference to the above of our above named client, we would like to submit as under; Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 1. You have claimed donations given on a/c of CSR expenditure of Rs.24,98,000/- in the P&L and the same is d in the ITR. However, the same donations are claimed u/s 80G of I.T.Act which is indirectly claiming the CSR expenditure which is not allowable u/s 37 (1) of I.T. this regard, please provide justification of your claim and also produce the objects of the trusts to whom you have given donations and explain how such objects will fall into the category of CSR expenditure u/s 135 of Companies Act Further, the Ld. counsel referred a detailed reply filed before the Assessing Officer explaining the name of the parties in respect of whom deduction was claimed. In the said reply, the assessee also decision of the Bangalore Bench of the Tribunal in the case of First American (India) Pvt. Ltd. (supra) and Allegies Services (India) Pvt. Ltd. (supra) wherein the Tribunal has allowed the deduction u/s 80G in respect of CSR expenditure. For ready reference the relevant reply filed by the assessee is reproduced as Deputy Commissioner of Income Tax, Central Circle 3(2), Room No 1913,19th Floor, Air India Building, 400021 Ref: Jeevandeep Edumedia Private Limited PAN: AABCJ0180G DIN: ITBA/AST/F/142(l)/2022-23/1044213216(l) Sub: Reassessment proceedings for the assessment year With reference to the above subject and under the instructions of our above named client, we would like to submit as under; Jeevandeep Edumedia Pvt. Ltd. 8 ITA No. 2517/MUM/2025 1. You have claimed donations given on a/c of CSR in the P&L and the same is d in the ITR. However, the same donations are claimed u/s 80G of I.T.Act which is indirectly claiming the CSR expenditure which is not allowable u/s 37 (1) of I.T. Act. In this regard, please provide justification of your claim and also of the trusts to whom you have given donations and explain how such objects will fall into the Act.” Further, the Ld. counsel referred a detailed reply filed before name of the parties in respect of whom deduction was claimed. In the said reply, the assessee also decision of the Bangalore Bench of the Tribunal in the case of First American (India) Pvt. Ltd. (supra) and Allegies d. (supra) wherein the Tribunal has allowed the deduction u/s 80G in respect of CSR expenditure. For ready reference the relevant reply filed by the assessee is reproduced as Sub: Reassessment proceedings for the assessment year subject and under the instructions of our above named client, we would like to submit as under; The assessee is in receipt of notice u/s 142(1) dated 28/07/2022. In response to the said notice, the assessee wishes to submit the following, in addition to th made dated 05/01/2022, 17/03/2022, 21/07/2022 and 29/07/2022: 1. The assessee company, for the year under consideration has made a total donation of Rs.24,98,000/ charitable institutions as mentioned below; Name of Institution Bhagwan Mahavir Pashu Raksha Kendra Shri K.V.O Utkarsh Pratishtan Kutch Yuvak Sangh Konkan education society ST. Thomas Church Daar-ul-rehmat Trust ST. MICHAEL charitable trust SHETH DHANJI DEVSHI KVO KELAVANI FUND Karnataka Holy cross sisters society Shri K.V.O. Seva Samaj Shri Bhojay Sarvodaya Trust Srimad Rajchandra Adhyatmik Satsang Sadhna Kendra SWAMI VIVEKANAND SHIKSHAN SANSTHA Laxmiben Lalji Furia Charitable Trust Total Donation Qualifying Amount Deductible amount under section 80 G @ 50% Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 The assessee is in receipt of notice u/s 142(1) dated 28/07/2022. In response to the said notice, the assessee wishes to submit the following, in addition to the submissions made dated 05/01/2022, 17/03/2022, 21/07/2022 and 1. The assessee company, for the year under consideration has made a total donation of Rs.24,98,000/- to various charitable institutions as mentioned below; PAN Amount (in Rs.) Bhagwan Mahavir Pashu Raksha AAAJB0003 1,00,000 Shri K.V.O Utkarsh Pratishtan AAOTS5780M 2,00,000 AAATK0253F 1,25,000 Konkan education society AAATK3407H 51,000 AABTS9310C 30,000 AAATD0376Q 6,000 ST. MICHAEL charitable trust AAKTS7117G 15,000 SHETH DHANJI DEVSHI KVO AAATS1495D 100,000 Karnataka Holy cross sisters AAATK1214E 16,000 Shri K.V.O. Seva Samaj AAATS0288A 55,000 Sarvodaya Trust AABTS8782J 1,00,000 Srimad Rajchandra Adhyatmik Satsang Sadhna Kendra AABTS2637Q 5,00,000 SWAMI VIVEKANAND SHIKSHAN AAAAS1296H 10,00,000 Laxmiben Lalji Furia Charitable AAATL0063C 2,00,000 24,98,000 24,98,000 Deductible amount under section 80 G @ 50% 12,49,000 Jeevandeep Edumedia Pvt. Ltd. 9 ITA No. 2517/MUM/2025 The assessee is in receipt of notice u/s 142(1) dated 28/07/2022. In response to the said notice, the assessee e submissions made dated 05/01/2022, 17/03/2022, 21/07/2022 and 1. The assessee company, for the year under consideration to various Amount (in Rs.) 1,00,000 2,00,000 1,25,000 51,000 30,000 6,000 15,000 100,000 16,000 55,000 1,00,000 5,00,000 10,00,000 2,00,000 24,98,000 24,98,000 12,49,000 Donation receipts issued by all the above charitable institutions along with 80G certificate and bank statement highlighting payments made by the assessee company is already submitted during the ongoing course of assessment proceedings. Contemporaneously, the above donations of Rs.24,98,000/ also gets covered as a contribution made towards CSR activities and hence such expenditure was also classified as a CSR expenditure in same was disallowed in accordance with the provisions of section 37{1) of the IT Act while computing income under the head Income from Business. While computing the total income of the assessee company for the year under consideration, deduction under section 80G of the IT Act is available for donations made by an assessee to institutions/funds/trusts registered under the Income Tax Act, 1961. During the year, the assessee company had made 14 donations (as stated above registered under the provisions of Income Tax Act, 1961 and hence all the conditions laid down in section 80G of the IT Act were duly satisfied and accordingly deduction of Rs.12,49,000/ For the sake of easy reference, we wish to draw your kind attention to the history behind the allowability of CSR expenditure and amendment thereon for disallowance, as under; Prior to 2013 either by the company or group companies, some of the voluntary group like public welfare scheme etc such activities, when found to be having nexus with the business of the assessee and were incurred wholly and exclusively for the purpose of the business, were eligible as a ta a few other instances, the expenditure incurred on the CSR activities were not allowed as a deduction, but were eligible for deduction under section 80G, subject to meeting the conditions therein. However, having regard to the philanthropic nature and were not necessarily a business expense, the Parliament legislated that CSR expenses would not be eligible for deduction under section 37 of the IT Act. For this purpose, Explanation 2 to section 37(1) the Finance (No 2) Act, 2014 (applicable from the assessment Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 Donation receipts issued by all the above charitable institutions along with 80G certificate and bank statement highlighting payments made by the assessee company is submitted during the ongoing course of assessment Contemporaneously, the above donations of Rs.24,98,000/ also gets covered as a contribution made towards CSR activities and hence such expenditure was also classified as a CSR expenditure in the financial statements and hence the same was disallowed in accordance with the provisions of section 37{1) of the IT Act while computing income under the head Income from Business. While computing the total income of the assessee company for der consideration, deduction under section 80G of the IT Act is available for donations made by an assessee to institutions/funds/trusts registered under the Income Tax Act, 1961. During the year, the assessee company had made 14 donations (as stated above) and ail the entities were duly registered under the provisions of Income Tax Act, 1961 and hence all the conditions laid down in section 80G of the IT Act were duly satisfied and accordingly deduction of Rs.12,49,000/- was claimed in the return of income. For the sake of easy reference, we wish to draw your kind attention to the history behind the allowability of CSR expenditure and amendment thereon for disallowance, as Prior to 2013 either by the company or group companies, some of the voluntary CSR activities undertaken by the company / group like public welfare scheme etc such activities, when found to be having nexus with the business of the assessee and were incurred wholly and exclusively for the purpose of the business, were eligible as a tax-deductible expenditure. In a few other instances, the expenditure incurred on the CSR activities were not allowed as a deduction, but were eligible for deduction under section 80G, subject to meeting the conditions therein. However, having regard to the fact that CSR expenses have a philanthropic nature and were not necessarily a business expense, the Parliament legislated that CSR expenses would not be eligible for deduction under section 37 of the IT Act. For this purpose, Explanation 2 to section 37(1) was inserted vide the Finance (No 2) Act, 2014 (applicable from the assessment Jeevandeep Edumedia Pvt. Ltd. 10 ITA No. 2517/MUM/2025 Donation receipts issued by all the above charitable institutions along with 80G certificate and bank statement highlighting payments made by the assessee company is submitted during the ongoing course of assessment Contemporaneously, the above donations of Rs.24,98,000/- also gets covered as a contribution made towards CSR activities and hence such expenditure was also classified as a the financial statements and hence the same was disallowed in accordance with the provisions of section 37{1) of the IT Act while computing income under the While computing the total income of the assessee company for der consideration, deduction under section 80G of the IT Act is available for donations made by an assessee to institutions/funds/trusts registered under the Income Tax Act, 1961. During the year, the assessee company had made 14 ) and ail the entities were duly registered under the provisions of Income Tax Act, 1961 and hence all the conditions laid down in section 80G of the IT Act were duly satisfied and accordingly deduction of For the sake of easy reference, we wish to draw your kind attention to the history behind the allowability of CSR expenditure and amendment thereon for disallowance, as Prior to 2013 either by the company or group companies, some CSR activities undertaken by the company / group like public welfare scheme etc such activities, when found to be having nexus with the business of the assessee and were incurred wholly and exclusively for the purpose of deductible expenditure. In a few other instances, the expenditure incurred on the CSR activities were not allowed as a deduction, but were eligible for deduction under section 80G, subject to meeting the fact that CSR expenses have a philanthropic nature and were not necessarily a business expense, the Parliament legislated that CSR expenses would not be eligible for deduction under section 37 of the IT Act. For was inserted vide the Finance (No 2) Act, 2014 (applicable from the assessment year 2015-16), which provided that any expenditure incurred by an assessee on the activities relating to CSR referred to in section 135 of Companies Act 2013, shall not be deem an expenditure incurred by the 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 said provision is given in the Explanatory Memorandum to the Finance (No.2) Bill, 2014 [Circular No. 01/2015, Dated 21st January, 2015] 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 appl deduction for the purposes of computing taxable income of a company, amount spent on CSR cannot be allowed as deduction for computing the taxable income of the company. Moreover, the objective of CSR is to share burden o Government in providing social services by companies having net worth/turnover/profit above a threshold. If such expenses are allowed as tax deduction, this would result in subsidizing of around one way of tax expenditure. The existing provisions of section 37(1) of the Act provide that deduction for any expenditure, which is not mentioned specifically in section 30 to section 36 of the Act, shall be allowed if the same is incurred wholly and exclusively for purposes of carrying on business or profession. As the CSR expenditure (being an application of income) is not incurred for the purposes of carrying on business, such expenditures cannot be allowed under the existing provisions of section 37 of the Income on this issue, it is proposed to clarify that for the purposes of section 37(1) any expenditure incurred by an assessee on the activities relating to corporate social responsibility referred to in section 135 of the Companies Act, 2013 shall not be deemed to have been incurred for the purpose of business and hence shall not be allowed as deduction under section 37. However, the CSR expenditure which is of the nature described in section 30 to section 36 deduction under those sections subject to fulfillment of conditions, if any, specified therein.\" Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 16), which provided that any expenditure incurred by an assessee on the activities relating to CSR referred to in section 135 of Companies Act 2013, shall not be deem an expenditure incurred by the 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 said provision is given in the Explanatory um to the Finance (No.2) Bill, 2014 [Circular No. 01/2015, Dated 21st January, 2015] and is reproduced as \"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, amount spent on CSR cannot be allowed as deduction for computing the taxable income of the company. Moreover, the objective of CSR is to share burden o Government in providing social services by companies having net worth/turnover/profit above a threshold. If such expenses are allowed as tax deduction, this would result in subsidizing of around one-third of such expenses by the Government by expenditure. The existing provisions of section 37(1) of the Act provide that deduction for any expenditure, which is not mentioned specifically in section 30 to section 36 of the Act, shall be allowed if the same is incurred wholly and exclusively for purposes of carrying on business or profession. As the CSR expenditure (being an application of income) is not incurred for the purposes of carrying on business, such expenditures cannot be allowed under the existing provisions of section 37 come-tax Act. Therefore, in order to provide certainty on this issue, it is proposed to clarify that for the purposes of section 37(1) any expenditure incurred by an assessee on the activities relating to corporate social responsibility referred to ion 135 of the Companies Act, 2013 shall not be deemed to have been incurred for the purpose of business and hence shall not be allowed as deduction under section 37. However, the CSR expenditure which is of the nature described in section 30 to section 36 of the Act shall be allowed as deduction under those sections subject to fulfillment of conditions, if any, specified therein.\" Jeevandeep Edumedia Pvt. Ltd. 11 ITA No. 2517/MUM/2025 16), which provided that any expenditure incurred by an assessee on the activities relating to CSR referred to in section 135 of Companies Act 2013, shall not be deemed to be an expenditure incurred by the 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 said provision is given in the Explanatory um to the Finance (No.2) Bill, 2014 [Circular No. - 01/2015, Dated 21st January, 2015] and is reproduced as \"CSR expenditure, being an application of income, is not incurred wholly and exclusively for the purposes of carrying on ication of income is not allowed as deduction for the purposes of computing taxable income of a company, amount spent on CSR cannot be allowed as deduction for computing the taxable income of the company. Moreover, the objective of CSR is to share burden of the Government in providing social services by companies having net worth/turnover/profit above a threshold. If such expenses are allowed as tax deduction, this would result in subsidizing third of such expenses by the Government by The existing provisions of section 37(1) of the Act provide that deduction for any expenditure, which is not mentioned specifically in section 30 to section 36 of the Act, shall be allowed if the same is incurred wholly and exclusively for the purposes of carrying on business or profession. As the CSR expenditure (being an application of income) is not incurred for the purposes of carrying on business, such expenditures cannot be allowed under the existing provisions of section 37 tax Act. Therefore, in order to provide certainty on this issue, it is proposed to clarify that for the purposes of section 37(1) any expenditure incurred by an assessee on the activities relating to corporate social responsibility referred to ion 135 of the Companies Act, 2013 shall not be deemed to have been incurred for the purpose of business and hence shall not be allowed as deduction under section 37. However, the CSR expenditure which is of the nature described in of the Act shall be allowed as deduction under those sections subject to fulfillment of Thus, it is a clear that the CSR expenditure referred to in section 135 cannot be claimed as a tax deductible expenditure under section 37(1) of the IT Act. However, CSR expenditure, which is of the nature described under sections 30 to 36 of the IT, was allowable as a deduction, say CSR expenditure laid out or expended on Scientific Research related to the business is allowable under section 35(1)(i) and 35(1)(iv) etc. Expenditure on CSR could take many forms. There could be expenditure on projects directly undertaken by company, such as setting up and running schools, social business projects, etc. Such expenditure would inc falling for consideration under section 37(1) of the IT Act. On the other hand, companies, instead of undertaking or participating directly in a project, may choose to give donations to institutions that are engaged in undertakin While expenditure falling within the ambit of section 37(1) would undoubtedly not qualify, the donations, which indirectly help to meet the CSR obligation, would qualify for deduction under section 80G, if the donation otherwise satisfies conditions laid down in that section. After the amendment, the revenue have objected to the claim of deduction under section 80G for eligible donations, qualifying for CSR under the Companies Act 2013. The revenue authorities contend that the intentio never to allow deduction for CSR expenditure, else it would result in subsidizing the CSR expenditure by one Furthermore, it is the contention of the revenue that CSR expenditure is not 'voluntary', but 'mandatory' in In this regard, assessee company submits as under;  In the Memorandum to the Finance Bill, it has been clarified that no deduction will be allowed for CSR expenditure as a business expenditure, but there is no reference to ineligibility or restric deduction under section 80G for donations made pursuant to Companies Act 2013 obligations. Also, in the Memorandum, it has been clarified that CSR expenses which fall for consideration under sections 30 to 36 of the IT Act are allowable. T emerges that the intent of the Legislature was not to blankly disallow every CSR expenditure. Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 Thus, it is a clear that the CSR expenditure referred to in section 135 cannot be claimed as a tax deductible expenditure under section 37(1) of the IT Act. However, CSR expenditure, which is of the nature described under sections 30 to 36 of the IT, was allowable as a deduction, say CSR expenditure laid out or expended on Scientific Research related to the business ble under section 35(1)(i) and 35(1)(iv) etc. Expenditure on CSR could take many forms. There could be expenditure on projects directly undertaken by company, such as setting up and running schools, social business projects, etc. Such expenditure would include expenditure otherwise falling for consideration under section 37(1) of the IT Act. On the other hand, companies, instead of undertaking or participating directly in a project, may choose to give donations to institutions that are engaged in undertaking such projects. While expenditure falling within the ambit of section 37(1) would undoubtedly not qualify, the donations, which indirectly help to meet the CSR obligation, would qualify for deduction under section 80G, if the donation otherwise satisfies conditions laid down in that section. After the amendment, the revenue have objected to the claim of deduction under section 80G for eligible donations, qualifying for CSR under the Companies Act 2013. The revenue authorities contend that the intention of the legislature was never to allow deduction for CSR expenditure, else it would result in subsidizing the CSR expenditure by one-third amount. Furthermore, it is the contention of the revenue that CSR expenditure is not 'voluntary', but 'mandatory' in nature. In this regard, assessee company submits as under;- In the Memorandum to the Finance Bill, it has been clarified that no deduction will be allowed for CSR expenditure as a business expenditure, but there is no reference to ineligibility or restriction in claiming deduction under section 80G for donations made pursuant to Companies Act 2013 obligations. Also, in the Memorandum, it has been clarified that CSR expenses which fall for consideration under sections 30 to 36 of the IT Act are allowable. Thus, a position emerges that the intent of the Legislature was not to blankly disallow every CSR expenditure. Jeevandeep Edumedia Pvt. Ltd. 12 ITA No. 2517/MUM/2025 Thus, it is a clear that the CSR expenditure referred to in section 135 cannot be claimed as a tax deductible expenditure under section 37(1) of the IT Act. However, CSR expenditure, which is of the nature described under sections 30 to 36 of the IT, was allowable as a deduction, say CSR expenditure laid out or expended on Scientific Research related to the business Expenditure on CSR could take many forms. There could be expenditure on projects directly undertaken by company, such as setting up and running schools, social business projects, lude expenditure otherwise falling for consideration under section 37(1) of the IT Act. On the other hand, companies, instead of undertaking or participating directly in a project, may choose to give donations g such projects. While expenditure falling within the ambit of section 37(1) would undoubtedly not qualify, the donations, which indirectly help to meet the CSR obligation, would qualify for deduction under section 80G, if the donation otherwise satisfies the After the amendment, the revenue have objected to the claim of deduction under section 80G for eligible donations, qualifying for CSR under the Companies Act 2013. The revenue n of the legislature was never to allow deduction for CSR expenditure, else it would third amount. Furthermore, it is the contention of the revenue that CSR nature. In the Memorandum to the Finance Bill, it has been clarified that no deduction will be allowed for CSR expenditure as a business expenditure, but there is no tion in claiming deduction under section 80G for donations made pursuant to Companies Act 2013 obligations. Also, in the Memorandum, it has been clarified that CSR expenses which fall for consideration under sections 30 hus, a position emerges that the intent of the Legislature was not to  Section 80G(1) provides that in computing the total income of the assessee, there shall be deducted, in accordance with the provisions of this se sum paid by the assessee in the previous year as a donation. Further, section 80G(2) list down the sums on which deduction shall be allowed to the assessee. Section 80G falls in Chapter VIA, which comes into play only after the gross total inco applying the computation provisions under various heads of income, including the Explanation 2 to section 37(1). Thus, there is no correlation between section 37(1) and section 80G. Principles governing what is not allowable under s itself (i.e. what is allowable, the conditions subject to which it is allowable, the extent to which it is allowable) and also what is not allowable under section 80G.  Section 80G specifically mentions two in section 80G(2)(a)(iiihk) and (iiihl), i.e., contributions towards Swacha Bharat Kosh and Clean Ganga Fund), where CSR expenditure is not allowable as deduction under section 80G.  Section 80G(2)(a) allows deduction for 'any sums paid by the a Thus, the deduction allowable is for sums paid as donation. Donations made to the Swacha Bharat Kosh and Clean Ganga Fund are not allowable under section 80G(2)(a)(iiihk) and (iiihl). Contributions to Swacha Bharat Kosh and Clean Ganga Fund are CSR activities included in Schedule VII to the Companies Act 2013. The disallowance for deduction under section 80G vis à-vis CSR can be restricted only to contributions to these Funds under CSR. It is a well interpretation that one has to look merely at what is stated in the statute; there is no scope for intendment in law. Your kind attention is invited to the recent ruling of Karnataka High Court in case of Nandi Steels Ltd (TS 483-HC be paid to what is said and what has not been said. In view of the above, your goodself will appreciate that contributions made to the above two funds will not qualify for deduction under section 80G(2)(a), however as there i Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 Section 80G(1) provides that in computing the total income of the assessee, there shall be deducted, in accordance with the provisions of this section, such sum paid by the assessee in the previous year as a donation. Further, section 80G(2) list down the sums on which deduction shall be allowed to the assessee. Section 80G falls in Chapter VIA, which comes into play only after the gross total income has been computed by applying the computation provisions under various heads of income, including the Explanation 2 to section Thus, there is no correlation between section 37(1) and section 80G. Principles governing what is not allowable under section 37(1) have been explained in the section itself (i.e. what is allowable, the conditions subject to which it is allowable, the extent to which it is allowable) and also what is not allowable under section 80G. Section 80G specifically mentions two instances (viz, section 80G(2)(a)(iiihk) and (iiihl), i.e., contributions towards Swacha Bharat Kosh and Clean Ganga Fund), where CSR expenditure is not allowable as deduction under section 80G. Section 80G(2)(a) allows deduction for 'any sums paid by the assessee in the previous year as donations'. Thus, the deduction allowable is for sums paid as donation. Donations made to the Swacha Bharat Kosh and Clean Ganga Fund are not allowable under section 80G(2)(a)(iiihk) and (iiihl). Contributions to Swacha at Kosh and Clean Ganga Fund are CSR activities included in Schedule VII to the Companies Act 2013. The disallowance for deduction under section 80G vis vis CSR can be restricted only to contributions to these Funds under CSR. It is a well-established ru interpretation that one has to look merely at what is stated in the statute; there is no scope for intendment in law. Your kind attention is invited to the recent ruling of Karnataka High Court in case of Nandi Steels Ltd (TS HC-2021), wherein it is held that attention has to be paid to what is said and what has not been said. In view of the above, your goodself will appreciate that contributions made to the above two funds will not qualify for deduction under section 80G(2)(a), however as there is no restriction on other donations which also Jeevandeep Edumedia Pvt. Ltd. 13 ITA No. 2517/MUM/2025 Section 80G(1) provides that in computing the total income of the assessee, there shall be deducted, in ction, such sum paid by the assessee in the previous year as a donation. Further, section 80G(2) list down the sums on which deduction shall be allowed to the assessee. Section 80G falls in Chapter VIA, which comes into play me has been computed by applying the computation provisions under various heads of income, including the Explanation 2 to section Thus, there is no correlation between section 37(1) and section 80G. Principles governing what is not allowable ection 37(1) have been explained in the section itself (i.e. what is allowable, the conditions subject to which it is allowable, the extent to which it is allowable) and also what is not allowable under section 80G. stances (viz, section 80G(2)(a)(iiihk) and (iiihl), i.e., contributions towards Swacha Bharat Kosh and Clean Ganga Fund), where CSR expenditure is not allowable as deduction Section 80G(2)(a) allows deduction for 'any sums paid ssessee in the previous year as donations'. Thus, the deduction allowable is for sums paid as donation. Donations made to the Swacha Bharat Kosh and Clean Ganga Fund are not allowable under section 80G(2)(a)(iiihk) and (iiihl). Contributions to Swacha at Kosh and Clean Ganga Fund are CSR activities included in Schedule VII to the Companies Act 2013. The disallowance for deduction under section 80G vis- vis CSR can be restricted only to contributions to established rule of interpretation that one has to look merely at what is stated in the statute; there is no scope for intendment in law. Your kind attention is invited to the recent ruling of Karnataka High Court in case of Nandi Steels Ltd (TS- is held that attention has to be paid to what is said and what has not been said. In view of the above, your goodself will appreciate that contributions made to the above two funds will not qualify for deduction under section 80G(2)(a), however s no restriction on other donations which also qualify for CSR activity, the said donation will be eligible for deduction.  Furthermore, amid Covid Government had provided various relaxation and measures and also sought contributions to the CARE fund to deal with the pandemic. Such contributions are eligible as CSR expenditure under the Companies Act 2013 and for deduction under section 80G of the IT Act. Thus, it can be said that the intent of the legislature is not to restrict deduction qualifies as CSR expenditure under the CA 2013.  The Ministry of Corporate Affairs ('MCA') has issued Frequently Asked Questions ('FAQ') through General circular no. 01/2016 dated January 12, 2016 (FAQ No. 6) has \"Question No. 6: What tax benefits can be availed under CSR? Answer: No specific tax exemptions have been extended to CSR expenditure per se. The Finance Act, 2014 also clarifies that expenditure on CSR does not form part of business expenditure. While no specific tax exemptions have been extended to expenditure inc activities like Prime Minister's Relief Fund, scientific research, rural development projects, skill development projects, agriculture extension projects etc, which fund place in Schedule VII, already enjoys exemptions un sections of the Income This clarification issued by one arm of the Government, supports the view that deduction under section 80G is allowable on such contributions. Jurisprudence on allowability of donations (forming part of CSR expenditure) under section 80G of the IT Act  In Goldman Sachs Services Pvt. Ltd. v. JCIT [IT(TP)A No.2355/Bang/2019 Officer ('AO'), disallowed deduction under section 80G on the basis that the donations were in the nature CSR expenditure and not in the nature of 'voluntary contribution'. The Bangalore Tribunal observed that the CSR expenditure was required to be incurred as per the Companies Act 2013 and as per the amendment introduced to section 37 of the IT Act, a ded Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 qualify for CSR activity, the said donation will be eligible for deduction. Furthermore, amid Covid-19 pandemic, the Government had provided various relaxation and measures and also sought contributions to the CARE fund to deal with the pandemic. Such contributions are eligible as CSR expenditure under the Companies Act 2013 and for deduction under section 80G of the IT Act. Thus, it can be said that the intent of the legislature is not to restrict deduction under section 80G, even if the contribution qualifies as CSR expenditure under the CA 2013. The Ministry of Corporate Affairs ('MCA') has issued Frequently Asked Questions ('FAQ') through General circular no. 01/2016 dated January 12, 2016 (FAQ No. 6) has clarified that as follows: \"Question No. 6: What tax benefits can be availed under CSR? Answer: No specific tax exemptions have been extended to CSR expenditure per se. The Finance Act, 2014 also clarifies that expenditure on CSR does not form part of business expenditure. While no specific tax exemptions have been extended to expenditure incurred on CSR, spending on several activities like Prime Minister's Relief Fund, scientific research, rural development projects, skill development projects, agriculture extension projects etc, which fund place in Schedule VII, already enjoys exemptions under different sections of the Income-tax Act, 1961.\" This clarification issued by one arm of the Government, supports the view that deduction under section 80G is allowable on such contributions. Jurisprudence on allowability of donations (forming CSR expenditure) under section 80G of the IT Act In Goldman Sachs Services Pvt. Ltd. v. JCIT [IT(TP)A No.2355/Bang/2019-Banglore ITAT ), the Assessing Officer ('AO'), disallowed deduction under section 80G on the basis that the donations were in the nature CSR expenditure and not in the nature of 'voluntary contribution'. The Bangalore Tribunal observed that the CSR expenditure was required to be incurred as per the Companies Act 2013 and as per the amendment introduced to section 37 of the IT Act, a deduction for Jeevandeep Edumedia Pvt. Ltd. 14 ITA No. 2517/MUM/2025 qualify for CSR activity, the said donation will be 19 pandemic, the Government had provided various relaxation and measures and also sought contributions to the PM CARE fund to deal with the pandemic. Such contributions are eligible as CSR expenditure under the Companies Act 2013 and for deduction under section 80G of the IT Act. Thus, it can be said that the intent of the legislature is not to restrict under section 80G, even if the contribution qualifies as CSR expenditure under the CA 2013. The Ministry of Corporate Affairs ('MCA') has issued Frequently Asked Questions ('FAQ') through General circular no. 01/2016 dated January 12, 2016 (FAQ \"Question No. 6: What tax benefits can be availed under CSR? Answer: No specific tax exemptions have been extended to CSR expenditure per se. The Finance Act, 2014 also clarifies that expenditure on CSR does not form part of business expenditure. While no specific tax exemptions have been urred on CSR, spending on several activities like Prime Minister's Relief Fund, scientific research, rural development projects, skill development projects, agriculture extension projects etc, which fund place in der different This clarification issued by one arm of the Government, supports the view that deduction under section 80G is Jurisprudence on allowability of donations (forming CSR expenditure) under section 80G of the IT Act In Goldman Sachs Services Pvt. Ltd. v. JCIT [IT(TP)A Banglore ITAT ), the Assessing Officer ('AO'), disallowed deduction under section 80G on the basis that the donations were in the nature of CSR expenditure and not in the nature of 'voluntary contribution'. The Bangalore Tribunal observed that the CSR expenditure was required to be incurred as per the Companies Act 2013 and as per the amendment uction for the same was not available under section 37 of the IT Act. However, the assessee had claimed deduction of donation under section 80G. The Tribunal noted that CSR contributions to Swachh Bharat Kosh and Clean Ganga Fund, were specifically exclude of section 80G of the IT Act. In view of this, the Tribunal inferred that other CSR qualifying donations are eligible for deduction under section 80G, subject to the assessee satisfying the requisite conditions prescribed for deduction und In another set of following decisions of Bangalore Tribunal;  First American (India) Pvt. Ltd v. ACIT (ITA No.1762/Bang/2019) / [TS 2020(BANGALORE)  Allegis services (India) Pvt. Ltd v. ACIT (ITA No.1693/Bang/2019) 2020(BANGALORE) The deduction under section 80G was initially disallowed by the AO, since CSR qualifying donations were not 'voluntary contributions'. On appeal filed by the assessee, Tribunal allowed the deduction under section 80G a \"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.\" Considering the above, the assessee has correctly disallowed the CSR / donation expenses u/s 37(1) of the Act in computing the business income and claimed deduction u/s 80G of the Act in accordance with the pro In connection with the requirement of your office in regards to the objects of the trust to whom donations have been given and explanation as to how the same falls into the category of CSR expenditure u/s 135 of Companies Act 2013, the assessee company submits the Annual Report on CSR activities (vide Annexure 1) which contains the nature and category of the CSR expenditure incurred by the assessee company during the year under reference. It may be noted that the expenditure incurred by t year under reference has been duly accepted as a CSR expenditure under the Companies Act 2013. In view of the same, your goodself will appreciate that the claim made by the Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 the same was not available under section 37 of the IT Act. However, the assessee had claimed deduction of donation under section 80G. The Tribunal noted that CSR contributions to Swachh Bharat Kosh and Clean Ganga Fund, were specifically excluded from the ambit of section 80G of the IT Act. In view of this, the Tribunal inferred that other CSR qualifying donations are eligible for deduction under section 80G, subject to the assessee satisfying the requisite conditions prescribed for deduction under section 80G of the IT Act. In another set of following decisions of Bangalore Tribunal; First American (India) Pvt. Ltd v. ACIT (ITA No.1762/Bang/2019) / [TS-5676 2020(BANGALORE)-0] Allegis services (India) Pvt. Ltd v. ACIT (ITA No.1693/Bang/2019) / [TS-5678 2020(BANGALORE)-O]] The deduction under section 80G was initially disallowed by the AO, since CSR qualifying donations were not 'voluntary contributions'. On appeal filed by the assessee, Tribunal allowed the deduction under section 80G and held that, \"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 , which is not the intention of Legislature.\" Considering the above, the assessee has correctly disallowed the CSR / donation expenses u/s 37(1) of the Act in computing the business income and claimed deduction u/s 80G of the Act in accordance with the provisions of IT Act. In connection with the requirement of your office in regards to the objects of the trust to whom donations have been given and explanation as to how the same falls into the category of CSR expenditure u/s 135 of Companies Act 2013, the ssessee company submits the Annual Report on CSR activities (vide Annexure 1) which contains the nature and category of the CSR expenditure incurred by the assessee company during the year under reference. It may be noted that the expenditure incurred by the assessee company during the year under reference has been duly accepted as a CSR expenditure under the Companies Act 2013. In view of the same, your goodself will appreciate that the claim made by the Jeevandeep Edumedia Pvt. Ltd. 15 ITA No. 2517/MUM/2025 the same was not available under section 37 of the IT Act. However, the assessee had claimed deduction of donation under section 80G. The Tribunal noted that CSR contributions to Swachh Bharat Kosh and Clean d from the ambit of section 80G of the IT Act. In view of this, the Tribunal inferred that other CSR qualifying donations are eligible for deduction under section 80G, subject to the assessee satisfying the requisite conditions prescribed In another set of following decisions of Bangalore Tribunal; First American (India) Pvt. Ltd v. ACIT (ITA 5676-ITAT- Allegis services (India) Pvt. Ltd v. ACIT (ITA 5678-ITAT- The deduction under section 80G was initially disallowed by the AO, since CSR qualifying donations were not 'voluntary contributions'. On appeal filed by the assessee, Tribunal nd held that, \"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 , which is not the intention of Legislature.\" Considering the above, the assessee has correctly disallowed the CSR / donation expenses u/s 37(1) of the Act in computing the business income and claimed deduction u/s 80G of the Act In connection with the requirement of your office in regards to the objects of the trust to whom donations have been given and explanation as to how the same falls into the category of CSR expenditure u/s 135 of Companies Act 2013, the ssessee company submits the Annual Report on CSR activities (vide Annexure 1) which contains the nature and category of the CSR expenditure incurred by the assessee company during the year under reference. It may be noted that he assessee company during the year under reference has been duly accepted as a CSR expenditure under the Companies Act 2013. In view of the same, your goodself will appreciate that the claim made by the assessee company for the year under reference is cor in accordance with the provisions of laws. In light of above facts, your goodself will appreciate that the donations made by the assessee company although forming part of CSR expenditure, is allowed as a deduction under section 80G of the IT Act a called for. Should your goodself require any further clarification, explanation or elaborations in respect of the above, we shall be glad to furnish the same. In case your goodself is inclined to deny the above claim, a virtual hearing may please be fixed. Thanking you. 3.2 The Assessing Officer has already referred to the said reply of the assessee in the assessment order. learned counsel contended that a full conducted by the Assessing Officer on the very issue now sought to be revised, and hence, the invocation of Explanation 2 to section 263 of the Act—on the ground of lack of enquiry or inadequate enquiry—was unwarranted. It was further submitted that the issue under consideration is one on which two views are reasonably possible, and the Assessing Officer had taken a view which is legally tenable. In such circumstances, it was urged that the assessmen order cannot be termed as erroneous insofar as it is prejudicial to the interest of the Revenue.\" Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 assessee company for the year under reference is cor in accordance with the provisions of laws. In light of above facts, your goodself will appreciate that the donations made by the assessee company although forming part of CSR expenditure, is allowed as a deduction under section 80G of the IT Act and therefore no adverse inference is Should your goodself require any further clarification, explanation or elaborations in respect of the above, we shall be glad to furnish the same. In case your goodself is inclined to deny the above claim, a virtual hearing may please be fixed. Thanking you. Yours truly, For GBCA & Associates LLP Chartered Accountants he Assessing Officer has already referred to the said reply of the assessee in the assessment order. In light of the above, the learned counsel contended that a full-fledged enquiry was conducted by the Assessing Officer on the very issue now sought to be revised, and hence, the invocation of Explanation 2 to section on the ground of lack of enquiry or inadequate was unwarranted. It was further submitted that the issue under consideration is one on which two views are reasonably possible, and the Assessing Officer had taken a view which is legally tenable. In such circumstances, it was urged that the assessmen order cannot be termed as erroneous insofar as it is prejudicial to the interest of the Revenue.\" Jeevandeep Edumedia Pvt. Ltd. 16 ITA No. 2517/MUM/2025 assessee company for the year under reference is correct and In light of above facts, your goodself will appreciate that the donations made by the assessee company although forming part of CSR expenditure, is allowed as a deduction under nd therefore no adverse inference is Should your goodself require any further clarification, explanation or elaborations in respect of the above, we shall In case your goodself is inclined to deny the above claim, then Yours truly, For GBCA & Associates LLP Accountants” he Assessing Officer has already referred to the said reply of In light of the above, the fledged enquiry was conducted by the Assessing Officer on the very issue now sought to be revised, and hence, the invocation of Explanation 2 to section on the ground of lack of enquiry or inadequate was unwarranted. It was further submitted that the issue under consideration is one on which two views are reasonably possible, and the Assessing Officer had taken a view which is legally tenable. In such circumstances, it was urged that the assessment order cannot be termed as erroneous insofar as it is prejudicial to 4. The Ld. Departmental Representative (DR) on the other hand submitted the Assessing Officer has not made any discussion in the assessment order regarding Act which amounts to non Officer. He accordingly relied on the order of the Ld. PCIT. 4.1 In the rejoinder, the Ld. counsel for the assessee relied on the following three decisions on the Mumbai Bench of the Tribunal :  NTT Global Networks Pvt. Ltd. v. PCIT [ITA No. 3095/Mum/2025]  Dalal and Broacha Stock Broking Pvt. Ltd. v. Pr. CIT [ITA No. 2718/Mum/2025]  FDC Ltd. v. PCIT [ITA No. 1031/Mum/2024] 5. We have heard the rival contentions advanced on behalf of the parties and carefully perused the material placed on record. The legal position governing the exercise of revisional jurisdiction under Section 263 of the Act, stands well Court in Malabar Industrial Co. Ltd. v. CIT wherein it is held that for assumption of jurisdiction under Section 263, the twin conditions of the order being to the interests of the Revenue Unless both these conditions coexist, the invocation of the revisional power would be without lawful foundation. 5.1 In the instant case, the learned Principal Commissioner of Income-tax (PCIT) has held the assessment order passe Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 The Ld. Departmental Representative (DR) on the other hand submitted the Assessing Officer has not made any discussion in the assessment order regarding the issue of deduction u/s 80G of the Act which amounts to non-application of the mind of the Assessing Officer. He accordingly relied on the order of the Ld. PCIT. In the rejoinder, the Ld. counsel for the assessee relied on the ions on the Mumbai Bench of the Tribunal : NTT Global Networks Pvt. Ltd. v. PCIT [ITA No. 3095/Mum/2025] Dalal and Broacha Stock Broking Pvt. Ltd. v. Pr. CIT [ITA No. 2718/Mum/2025] FDC Ltd. v. PCIT [ITA No. 1031/Mum/2024] We have heard the rival contentions advanced on behalf of the parties and carefully perused the material placed on record. The legal position governing the exercise of revisional jurisdiction under Section 263 of the Act, stands well-settled by the decisio Malabar Industrial Co. Ltd. v. CIT [(2000) 243 ITR 83 (SC)], wherein it is held that for assumption of jurisdiction under Section 263, the twin conditions of the order being erroneous to the interests of the Revenue must be cumulatively satisfied. Unless both these conditions coexist, the invocation of the revisional power would be without lawful foundation. In the instant case, the learned Principal Commissioner of tax (PCIT) has held the assessment order passe Jeevandeep Edumedia Pvt. Ltd. 17 ITA No. 2517/MUM/2025 The Ld. Departmental Representative (DR) on the other hand submitted the Assessing Officer has not made any discussion in the the issue of deduction u/s 80G of the application of the mind of the Assessing Officer. He accordingly relied on the order of the Ld. PCIT. In the rejoinder, the Ld. counsel for the assessee relied on the ions on the Mumbai Bench of the Tribunal : NTT Global Networks Pvt. Ltd. v. PCIT [ITA No. Dalal and Broacha Stock Broking Pvt. Ltd. v. Pr. We have heard the rival contentions advanced on behalf of the parties and carefully perused the material placed on record. The legal position governing the exercise of revisional jurisdiction under settled by the decision of this [(2000) 243 ITR 83 (SC)], wherein it is held that for assumption of jurisdiction under Section erroneous and prejudicial be cumulatively satisfied. Unless both these conditions coexist, the invocation of the revisional power would be without lawful foundation. In the instant case, the learned Principal Commissioner of tax (PCIT) has held the assessment order passed by the Assessing Officer to be both erroneous and prejudicial to the interest of the Revenue. The principal grounds on which such conclusion is drawn are twofold: first, the invocation of Explanation 2 to Section 263 of the Act, which deems an order to b and prejudicial where the Assessing Officer has failed to make enquiries or verification which, in the circumstances of the case, he ought to have undertaken; and second, the assertion that the Assessing Officer erred in law in allowing the ass deduction under Section 80G of the Act in respect of expenditure incurred towards corporate social responsibility (CSR), the same being, according to the PCIT, of a non 5.2 On a careful consideration of the record, we fi force in the submission of the learned counsel for the assessee that the Assessing Officer did not proceed mechanically or in breach of the standard of enquiry contemplated under the Act. The assessment record clearly demonstrates that a spe raised under Section 142(1) of the Act, vide notice dated 28.07.2022, calling upon the assessee to justify its claim under Section 80G vis-à-vis donations which formed part of its CSR expenditure. The assessee, in response, furnished a deta setting out the names of the donee institutions, the amount of donation, the nature of their registration under the Act, and further relied upon judicial precedents in support of its claim. These facts, in our considered view, clearly establish Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 Assessing Officer to be both erroneous and prejudicial to the interest of the Revenue. The principal grounds on which such conclusion is drawn are twofold: first, the invocation of Explanation 2 to Section 263 of the Act, which deems an order to b and prejudicial where the Assessing Officer has failed to make enquiries or verification which, in the circumstances of the case, he ought to have undertaken; and second, the assertion that the Assessing Officer erred in law in allowing the assessee’s claim of deduction under Section 80G of the Act in respect of expenditure incurred towards corporate social responsibility (CSR), the same being, according to the PCIT, of a non-voluntary nature. On a careful consideration of the record, we fi force in the submission of the learned counsel for the assessee that the Assessing Officer did not proceed mechanically or in breach of the standard of enquiry contemplated under the Act. The assessment record clearly demonstrates that a spe raised under Section 142(1) of the Act, vide notice dated 28.07.2022, calling upon the assessee to justify its claim under vis donations which formed part of its CSR expenditure. The assessee, in response, furnished a deta setting out the names of the donee institutions, the amount of donation, the nature of their registration under the Act, and further relied upon judicial precedents in support of its claim. These facts, in our considered view, clearly establish that the Assessing Officer Jeevandeep Edumedia Pvt. Ltd. 18 ITA No. 2517/MUM/2025 Assessing Officer to be both erroneous and prejudicial to the interest of the Revenue. The principal grounds on which such conclusion is drawn are twofold: first, the invocation of Explanation 2 to Section 263 of the Act, which deems an order to be erroneous and prejudicial where the Assessing Officer has failed to make enquiries or verification which, in the circumstances of the case, he ought to have undertaken; and second, the assertion that the essee’s claim of deduction under Section 80G of the Act in respect of expenditure incurred towards corporate social responsibility (CSR), the same voluntary nature. On a careful consideration of the record, we find substantial force in the submission of the learned counsel for the assessee that the Assessing Officer did not proceed mechanically or in breach of the standard of enquiry contemplated under the Act. The assessment record clearly demonstrates that a specific query was raised under Section 142(1) of the Act, vide notice dated 28.07.2022, calling upon the assessee to justify its claim under vis donations which formed part of its CSR expenditure. The assessee, in response, furnished a detailed reply, setting out the names of the donee institutions, the amount of donation, the nature of their registration under the Act, and further relied upon judicial precedents in support of its claim. These facts, that the Assessing Officer had applied his mind and examined the issue in depth. he Coordinate Bench of the Tribunal in v. PCIT [supra] has categorically held that where the Assessing Officer has taken one of the plausible views in law after considering the material before him, the revisional jurisdiction under Section 263 cannot be validly exercised. Tribunal(supra) is reproduced as under “12. Considering the second aspect of the Id. PCIT's order which is on CSR expenditure which according to the Id. PCIT was mandatory in nature as per the provisions of Section 135 of the Companies Act and does not tan exclusively for the purpose of business as per Explanation 2 to Section 37(1) of the Act and the same would not amount to the voluntary donation u/s. 80G of the Act. Admittedly, the Id. PCIT in his order has categorically stated that the said issue is covered in favour of the assessee by the decisions of the jurisdictional coordinate benches and the same is pending adjudication before the Hon'ble Jurisdictional Bombay High Court. Though, the ld. DR has relied o the ITAT Delhi Bench decision in the case of the Agilent Technologies (International) (P.) Ltd. (Supra), there are catena of decisions of the jurisdictional coordinate benches which has decided this issue in favour of the assessee which precedent. Hence, we observe that the ld. AO has taken one of the views that CSR expenditure is eligible deduction u/s. 80G of the Act. On this note, we find that the Id. PCIT's order does not hold merit on this count also not satisfied in the present 5.3 A similar position was taken by the Tribunal in PCIT [supra], wherein following the decisions in (India) Pvt. Ltd.(supra) is held that while CSR expenses may not be allowable under Section 37(1) of the Act, there exists no statutory bar in claiming deduction under Section 80G, provided the donation otherwise qualifies under Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 had applied his mind and examined the issue in depth. he Coordinate Bench of the Tribunal in NTT Global Networks Pvt. Ltd. [supra] has categorically held that where the Assessing Officer has taken one of the plausible views in law after considering the material before him, the revisional jurisdiction under Section 263 cannot be validly exercised. The relevant finding of the is reproduced as under: 12. Considering the second aspect of the Id. PCIT's order which is on CSR expenditure which according to the Id. PCIT was mandatory in nature as per the provisions of Section 135 of the Companies Act and does not tantamount to an expenditure incurred, wholly and exclusively for the purpose of business as per Explanation 2 to Section 37(1) of the Act and the same would not amount to the voluntary donation u/s. 80G of the Act. Admittedly, the Id. PCIT in his order has ategorically stated that the said issue is covered in favour of the assessee by the decisions of the jurisdictional coordinate benches and the same is pending adjudication before the Hon'ble Jurisdictional Bombay High Court. Though, the ld. DR has relied on the decisions of the ITAT Delhi Bench decision in the case of the Agilent Technologies (International) (P.) Ltd. (Supra), there are catena of decisions of the jurisdictional coordinate benches which has decided this issue in favour of the assessee which the Id. AO is bound to follow as precedent. Hence, we observe that the ld. AO has taken one of the views that CSR expenditure is eligible deduction u/s. 80G of the Act. On this note, we find that the Id. PCIT's order does not hold merit on this count also as the twin conditions specified u/s. 263 of the Act is not satisfied in the present case in hand.” A similar position was taken by the Tribunal in ], wherein following the decisions in (supra) and First American (India) Pvt. Ltd. held that while CSR expenses may not be allowable under Section 37(1) of the Act, there exists no statutory bar in claiming deduction under Section 80G, provided the donation otherwise qualifies under Jeevandeep Edumedia Pvt. Ltd. 19 ITA No. 2517/MUM/2025 had applied his mind and examined the issue in depth. he NTT Global Networks Pvt. Ltd. [supra] has categorically held that where the Assessing Officer has taken one of the plausible views in law after considering the material before him, the revisional jurisdiction under Section The relevant finding of the 12. Considering the second aspect of the Id. PCIT's order which is on CSR expenditure which according to the Id. PCIT was mandatory in nature as per the provisions of Section 135 of the Companies Act and tamount to an expenditure incurred, wholly and exclusively for the purpose of business as per Explanation 2 to Section 37(1) of the Act and the same would not amount to the voluntary donation u/s. 80G of the Act. Admittedly, the Id. PCIT in his order has ategorically stated that the said issue is covered in favour of the assessee by the decisions of the jurisdictional coordinate benches and the same is pending adjudication before the Hon'ble Jurisdictional n the decisions of the ITAT Delhi Bench decision in the case of the Agilent Technologies (International) (P.) Ltd. (Supra), there are catena of decisions of the jurisdictional coordinate benches which has decided this issue in the Id. AO is bound to follow as precedent. Hence, we observe that the ld. AO has taken one of the views that CSR expenditure is eligible deduction u/s. 80G of the Act. On this note, we find that the Id. PCIT's order does not hold merit on as the twin conditions specified u/s. 263 of the Act is A similar position was taken by the Tribunal in FDC Ltd. v. ], wherein following the decisions in Allegis Services First American (India) Pvt. Ltd. (supra), it held that while CSR expenses may not be allowable under Section 37(1) of the Act, there exists no statutory bar in claiming deduction under Section 80G, provided the donation otherwise qualifies under the said provision. The Tribunal rightly noted that this is a debatable issue and hence, the view taken by the Assessing Officer, being one of the possible views, cannot be branded as erroneous. The relevant finding of the Tribunal is reproduced as under: “12. With regard to the deduction allowed under section 80G of the Act, the view of Ld PCIT is that the said claim has been made by the assessee in respect of the expenses incurred on Corporate Social Responsibility (CSR), which is disallowable under section 3 Act and hence deduction under section 80G should not have been allowed. We notice that, in the following cases, it has been held that the disallowance of CSR expenses are required to be made u/s 37(1) of the Act, but there is no statutory bar i 80G of the Act if the said expenses are otherwise allowable as deduction under that section: (a) Allegis Services (India) Pvt Ltd vs. ACIT (ITA No.1693/Bang/ 2019)(Bang.) (Trib.) (b) JMS Mining (P) Ltd vs. PCIT (130 (c) First American (India) P Ltd vs. ACIT (ITA No. 1762/Bang/ 2019)(Bang) (Trib.) Thus, the view taken by Ld PCIT on this issue is a debatable one, meaning thereby, the action of the AO in allowing deduction u/s 80G results in a possible initiating revision proceedings on this issue. Accordingly, we set aside his order on 5.4 In light of the foregoing discussion, it is evident that the Assessing Officer had undertaken the req verification warranted in the fact and it is not necessary to reproduce his discussion wherever he has accepted the view of the Assessing Officer and the claim of Ld. DR of non-application of the mind of Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 said provision. The Tribunal rightly noted that this is a issue and hence, the view taken by the Assessing Officer, being one of the possible views, cannot be branded as erroneous. The relevant finding of the Tribunal is reproduced as under: With regard to the deduction allowed under section 80G of the Act, the view of Ld PCIT is that the said claim has been made by the assessee in respect of the expenses incurred on Corporate Social Responsibility (CSR), which is disallowable under section 3 Act and hence deduction under section 80G should not have been allowed. We notice that, in the following cases, it has been held that the disallowance of CSR expenses are required to be made u/s 37(1) of the Act, but there is no statutory bar in claiming the deduction u/s 80G of the Act if the said expenses are otherwise allowable as deduction under that section:- (a) Allegis Services (India) Pvt Ltd vs. ACIT (ITA No.1693/Bang/ 2019)(Bang.) (Trib.) (b) JMS Mining (P) Ltd vs. PCIT (130 taxmann.com 118) (c) First American (India) P Ltd vs. ACIT (ITA No. 1762/Bang/ 2019)(Bang) (Trib.) Thus, the view taken by Ld PCIT on this issue is a debatable one, meaning thereby, the action of the AO in allowing deduction u/s 80G results in a possible view. Accordingly, the Ld PCIT was not justified in initiating revision proceedings on this issue. Accordingly, we set aside this issue.” In light of the foregoing discussion, it is evident that the Assessing Officer had undertaken the requisite enquiries and verification warranted in the facts and circumstances of the case and it is not necessary to reproduce his discussion wherever he has accepted the view of the Assessing Officer and the claim of Ld. DR application of the mind of the Assessing Officer was Jeevandeep Edumedia Pvt. Ltd. 20 ITA No. 2517/MUM/2025 said provision. The Tribunal rightly noted that this is a issue and hence, the view taken by the Assessing Officer, being one of the possible views, cannot be branded as erroneous. The relevant finding of the Tribunal is reproduced as under: With regard to the deduction allowed under section 80G of the Act, the view of Ld PCIT is that the said claim has been made by the assessee in respect of the expenses incurred on Corporate Social Responsibility (CSR), which is disallowable under section 37(1) of the Act and hence deduction under section 80G should not have been allowed. We notice that, in the following cases, it has been held that the disallowance of CSR expenses are required to be made u/s 37(1) n claiming the deduction u/s 80G of the Act if the said expenses are otherwise allowable as (a) Allegis Services (India) Pvt Ltd vs. ACIT (ITA No.1693/Bang/ taxmann.com 118) (c) First American (India) P Ltd vs. ACIT (ITA No. 1762/Bang/ Thus, the view taken by Ld PCIT on this issue is a debatable one, meaning thereby, the action of the AO in allowing deduction u/s 80G view. Accordingly, the Ld PCIT was not justified in initiating revision proceedings on this issue. Accordingly, we set aside In light of the foregoing discussion, it is evident that the uisite enquiries and s and circumstances of the case and it is not necessary to reproduce his discussion wherever he has accepted the view of the Assessing Officer and the claim of Ld. DR the Assessing Officer was unwarranted. It is well elaborate discussion in the assessment order does not imply lack of enquiry or non-application of mind, where the record reveals that the issue was specifically raised a the Department that the order is vitiated by non stands negated in the face of documentary evidence to the contrary. 5.5 It further emerges from the record that divergent views exist on the allowability of deduction under Section 80G in respect of donations which also constitute CSR expenditure. While the Delhi Bench of the Tribunal in [(2024) 160 taxmann.com 238] has taken a view against such deductibility, the Bangalore Benches in Ltd.(supra) and First American (India) Pvt. Ltd. the claim. The existence of contrary but plausible legal views fortifies the conclusion that the issue is debatable. In India Ltd. [(2007) 295 ITR 282 (SC)], that where two views are reasonably possible and the Assessing Officer has taken one such view, the Commissioner cannot exercise revisionary powers merely because he prefers a different interpretation. The authority under Section 263 is not int confer jurisdiction upon superior officers to substitute their own opinion for that of the Assessing Officer, in matters which admit of a legitimate divergence of views. discussion, we are of the considered opinion th Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 It is well-established that the mere absence of elaborate discussion in the assessment order does not imply lack of application of mind, where the record reveals that the issue was specifically raised and replied to. The submission of the Department that the order is vitiated by non-application of mind stands negated in the face of documentary evidence to the contrary. It further emerges from the record that divergent views exist of deduction under Section 80G in respect of donations which also constitute CSR expenditure. While the Delhi Bench of the Tribunal in Agilent Technologies (International) (P.) Ltd. [(2024) 160 taxmann.com 238] has taken a view against such the Bangalore Benches in Allegis Services (India) Pvt. First American (India) Pvt. Ltd.(supra) the claim. The existence of contrary but plausible legal views fortifies the conclusion that the issue is debatable. In [(2007) 295 ITR 282 (SC)], Hon’ble Supreme that where two views are reasonably possible and the Assessing Officer has taken one such view, the Commissioner cannot exercise revisionary powers merely because he prefers a different interpretation. The authority under Section 263 is not int confer jurisdiction upon superior officers to substitute their own opinion for that of the Assessing Officer, in matters which admit of a legitimate divergence of views. In the light of the foregoing discussion, we are of the considered opinion that the assessment Jeevandeep Edumedia Pvt. Ltd. 21 ITA No. 2517/MUM/2025 established that the mere absence of elaborate discussion in the assessment order does not imply lack of application of mind, where the record reveals that nd replied to. The submission of application of mind stands negated in the face of documentary evidence to the contrary. It further emerges from the record that divergent views exist of deduction under Section 80G in respect of donations which also constitute CSR expenditure. While the Delhi Agilent Technologies (International) (P.) Ltd. [(2024) 160 taxmann.com 238] has taken a view against such Allegis Services (India) Pvt. (supra) have allowed the claim. The existence of contrary but plausible legal views fortifies the conclusion that the issue is debatable. In CIT v. Max Hon’ble Supreme Court held that where two views are reasonably possible and the Assessing Officer has taken one such view, the Commissioner cannot exercise revisionary powers merely because he prefers a different interpretation. The authority under Section 263 is not intended to confer jurisdiction upon superior officers to substitute their own opinion for that of the Assessing Officer, in matters which admit of In the light of the foregoing at the assessment order passed by the Assessing Officer cannot be said to be either erroneous or prejudicial to the interests of the Revenue within the meaning of Section 263 of the Act. The Assessing Officer has applied his mind to the issue in question a finds support in judicial pronouncements. Accordingly, the impugned order passed by the PCIT is liable to be, and is hereby, set aside. The relevant grounds of appeal of the assessee are accordingly allowed. 6. In the result, the a Order pronounced in the open Court on Sd/- (KAVITHA RAJAGOPAL JUDICIAL MEMBER Mumbai; Dated: 17/07/2025 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// Jeevandeep Edumedia Pvt. Ltd. ITA No. 2517/MUM/2025 order passed by the Assessing Officer cannot be said to be either erroneous or prejudicial to the interests of the Revenue within the meaning of Section 263 of the Act. The Assessing Officer has applied his mind to the issue in question and adopted a view which finds support in judicial pronouncements. Accordingly, the impugned order passed by the PCIT is liable to be, and is hereby, The relevant grounds of appeal of the assessee are In the result, the appeal of the assessee is stands allowed. nounced in the open Court on 17/07/2025. Sd/ (KAVITHA RAJAGOPAL) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai Jeevandeep Edumedia Pvt. Ltd. 22 ITA No. 2517/MUM/2025 order passed by the Assessing Officer cannot be said to be either erroneous or prejudicial to the interests of the Revenue within the meaning of Section 263 of the Act. The Assessing Officer has nd adopted a view which finds support in judicial pronouncements. Accordingly, the impugned order passed by the PCIT is liable to be, and is hereby, The relevant grounds of appeal of the assessee are ppeal of the assessee is stands allowed. /07/2025. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, (Assistant Registrar) ITAT, Mumbai "