KARSANBHAI NATVARLAL RAVAT,AHMEDABAD vs. ITO WARD 5(3)(1), AHMEDABAD, AHMEDABAD

The grounds of appeal are as under:- “1. The assessment order passed u/s 147 of Income Tax Act by the Assessing Officer and confirmed by the first appellate authority u/s 250 is bad in law and deserved to be uncalled for. 2. The assessing officer and appellate authority has erred in law and on facts in making and confirming respectively the disallowance of Rs. 1,55,000/-. The same deserves to be deleted. 3. The appellant craves to reserve his right to add, alter, amend, OR DLEETE any ground of appeal during the course of hearing.

The assessee is an individual and filed his ROI on 01.05.2019 declaring a total income of Rs. 12,12,370/-. In this instant case, information was flagged from Insight portal that the assessee has made donation of Rs. 155000/- to the Political Party named "Yuva Jan Jagrrirti Party". During the course of Search action u/s 132 of the Act on Registered Unrecognized Political Parties and post search enquiries made by the department it was found that the mentioned Political Party is running a scam by issuing receipt of donation in lieu of cheque and later on returning the amount to donor in cash after deducting certain amount for providing the bogus donation receipt. It is also found that the assessee has claimed deduction u/s 80GGC of the act in his ROI amounting to Rs. 200000/-. Therefore, a show cause notice u/s 148 of the Income-tax was issued by the AO on 30.03.2023 through ITBA and duly served to the assessee. The assessee has submitted online reply on 06.04.2023 in which he explained about his bank transaction regarding Donation of Rs. 155000/- to which he claimed as deduction u/s 80GGC in ROI. In this connection notice u/s 148 of the Act was issued on 26.04.2023 with a request to file the return for the related year. The assessee filed its ITR on 14.06.2023 declaring total income of Rs. 1212370/-. Accordingly the notice u/s 142 of the Act issued by Assessment Unit on 11.11.2024. In response to notice, the assessee has submitted his response on 04.12.2024. The reply of the assessee has been considered but not found tenable by the AO. Subsequently, AO had concluded the proceedings vide order u/s 147 rws 144B of the Act dated 07.03.2025, thereby disallowed the deduction of Rs. 155000/- made under section 80GGC.

Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee.

The ld. A.R. submitted that the Assessing Officer was not right in disallowing the deduction u/s. 80GGC relating to the donation of Rs. 1,55,000/-. The ld. A.R. submitted that the assessee was not involved any business activity and has received salary income of Rs. 17,70,905/- and has given the details of payment to the political party during the assessment proceedings. The assessee has submitted the details of bank statement.

The ld. D.R. submitted that the Assessing Officer has rightly disallowed the deduction as the assessee has given the donation to the political parties but has not explained the source except that of self salary income and the details of the same. The ld. D.R. relied upon the assessment order and the order of the CIT(A).

Heard both the parties and perused all the relevant material available on record. It is pertinent to note that the assessee while submitting his bank statement at page no. 8 to 18 has deposited certain cash amount during the 3 period of 23st January till and there is a entry 6th Feb, 2019 where there was a NEFT in his account for about 60,000/-. These are the few discrepancies which cannot be verified and therefore, the mater is remanded back to the file of the Assessing Officer for proper adjudication and verification of the details and accordingly, the Assessing Officer will decide as per Income Tax Act. Needless to say, the assessee be given opportunity of hearing by following principles of natural justice.

In the result, the appeal of the assessee is partly allowed for statistical purpose.