ITAT Mumbai quashed a revision under Section 263, holding that CSR donations can qualify for 80G benefits and that Section 37(1) does not bar such deductions.
CSR Donations Eligible for Section 80G: ITAT Mumbai
The ITAT, Mumbai, in a split decision from earlier views, quashed a revision initiated by the PCIT under Section 263, holding that donations made pursuant to Corporate Social Responsibility (CSR) obligations can still qualify for deductions under Section 80G. The tribunal held that Section 37(1) does not impose an automatic bar on CSR contributions if the recipient is approved under Section 80G.
The PCIT had argued that CSR spending is mandatory and thus not 'voluntary' within Section 80G’s meaning. The tribunal rejected this, stating that voluntariness under 80G depends on the nature of donation, not its source. It emphasized receipt of approval under 12AB as determinative.
Implication: Corporations may now consider combining CSR compliance with tax-efficient giving by channeling donations through 80G-approved bodies. This opens avenues for dual compliance with CSR and tax deduction planning.
