GPA CAPITAL FOODS PRIVATE LIMITED ,DELHI vs. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-26, DELHI, DELHI
What did the Tribunal hold?
The Tribunal held that CSR expenses are not allowable as deduction under Section 80G. However, it allowed the claim for CSR expenses as it was raised before the CIT(A) and the assessment was processed under Section 143(1). The addition of profit on sale of depreciable asset was also held unsustainable as Section 50 was not applicable.
What were the facts?
The assessee challenged disallowance of CSR expenses claimed as deduction under Section 80G and addition of profit on sale of fixed assets. The CIT(A) disallowed the CSR expenses as the claim was not made during assessment proceedings.
What were the issues?
Whether CSR expenses are allowable as deduction under Section 80G and whether profit on sale of depreciable asset is taxable as capital gains when Section 50 is not applicable.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “B” BENCH, DELHI
Before: SHRI M BALAGANESH & SHRI ANUBHAV SHARMA&
PER ANUBHAV SHARMA, JM:
The appeals are preferred by the assessee against the order dated
18.11.2025 of the Ld. Addl/JCIT(A)-5, Kolkata (hereinafter referred as Ld.
P a g e | 2 ITA No.9158/Del/2025 GPA Capital Foods Pvt. Ltd. (AY: 2019-20) First Appellate Authority or in short Ld. ‘FAA’) in DIN & Order No :
ITBA/APL/S/250/2025-26/1082728962(1) arising out of the intimation order
dated 04.12.2019 u/s 143(1) of the Income Tax Act, 1961 (hereinafter
referred to as ‘the Act’) passed by the CPC, Bangalore, for AY: 2019-20 and
intimation order dated 23.12.l2021 u/s 143(1) of the Act passed by the CPC,
Bangalore, for AY: 2020-21.
On hearing both sides we find that the first issue involved is common
in both the AYs, and is the disallowance of Rs.19,75,000/- in 2019-20 and
Rs.13,40,000/- in AY 2020-21, made by ld. tax authorities on the basis that as
this amount has been spent in CSR expenses and thus the same is not
allowable as deduction u/s 80G of the Act.
We find that the issue is squarely covered in favour of the assessee by
numerous decisions and we find that ld. CIT(A) has not considered the plea
only for the reason that the deduction was not sought at the time of
assessment proceedings. In this context, we find that return of assessee was
processed u/s 143(1) of the Act and thereafter assessee had filed appeal
before ld. CIT(A) and during appeal this additional claim was raised which
certainly could have been entertained by ld. CIT(A) by following decision of
P a g e | 3 ITA No.9158/Del/2025 GPA Capital Foods Pvt. Ltd. (AY: 2019-20) Hon’ble Supreme Court in Goetze (India) Ltd. vs. CIT(2006) 284 ITR 323
(SC). Thus, based on the aforesaid factual circumstance and settled
proposition of law we sustain the respective grounds as raised in both the
appeals.
In ITA No.9157/Del/2025 (Assessment Year: 2020-21), vide the
ground No. 2 the assessee is challenging the confirmation of addition of
Rs.2,82,521/- to the business income being profit on sale of fixed asset.
It is not in dispute that assessee had made profit on sale of fixed asset to
the tune of Rs.2,82,521/- which has been found credited in the profit and loss
account as per Companies Act, 2013. It is not in dispute that fixed asset sold
are depreciable asset. The assessee had sold plant and machinery worth
Rs.3,00,000/- and earned profit of Rs.2,82,521/- on such sale. After the sale,
the block of plant and machinery had not became negative, as there exist
asset in the block with positive value in the block. Hence, there is no question
of applicability of provision of Section 50 of the Act on sale of depreciable
asset. The assessee had already claimed lesser depreciation under the Income
Tax Act by reducing actual sale consideration figure in the block of plant and
machinery. The profit on sale of fixed asset of Rs.2,82,521/- has got nothing
P a g e | 4 ITA No.9158/Del/2025 GPA Capital Foods Pvt. Ltd. (AY: 2019-20) to do with the computation of income under the normal provision of the
Income Tax Act, 1961. Hence, the confirmation of addition of Rs.2,82,521/-
by the ld. CIT(A) is grossly unsustainable in the eyes of law and against the
provision of the Act. Accordingly, the ground No. 2 is allowed.
In the light of aforesaid discussion the appeals of assessee are allowed
with consequences to follow as per the determination of grounds, as above.
Order pronounced in the open court on 13.05.2026
Sd/- Sd/- (M Balaganesh) (Anubhav Sharma) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated 13.05.2026 Rohit, Sr. PS
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