DCIT- 2 1 1 MUMBAI, MUMBAI vs. M/S EBIXCASH WORLD MONEY LIMITED, MUMBAI

आदेश / O R D E R PER AMIT SHUKLA (J.M): The aforesaid appeal has been filed by the Revenue against the order dated 07.01.2026 passed by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, for Assessment Year 2018-19 arising out of assessment framed under section 143(3) of the Income Tax Act, 1961.

2 ITA No.3312/Mum/2026 Ebixcash World Money Limited

3 ITA No.3312/Mum/2026 Ebixcash World Money Limited donation made voluntarily by the donor, whereas the contribution in the present case was made in compliance with a statutory obligation cast upon the assessee under section 135 of the Companies Act, 2013. According to the Assessing Officer, once the expenditure was incurred pursuant to a legal mandate, it ceased to retain the character of a voluntary donation and therefore could not qualify for deduction under section 80G. Accordingly, the claim of deduction was rejected and the amount of Rs.1,80,00,000/- was added back to the income of the assessee.

4 ITA No.3312/Mum/2026 Ebixcash World Money Limited 6. After considering the submissions and examining the statutory provisions, the learned CIT(A) accepted the contention of the assessee and deleted the disallowance. The learned CIT(A) observed that section 80G expressly carves out exceptions only in respect of CSR contributions made to Swachh Bharat Kosh and Clean Ganga Fund and therefore the Legislature itself recognised the allowability of CSR contributions made to other institutions eligible under section 80G. The learned CIT(A) further observed that Centrum Foundation was admittedly approved under section 80G and the contribution received by it retained the character of a donation. Reliance was placed upon the decision of the Mumbai Bench of the Tribunal in the case of Societe Generale Securities India Pvt. Ltd. and other decisions of various benches of the Tribunal wherein it has been consistently held that although CSR expenditure is not allowable under section 37(1), the same can nevertheless be considered independently under Chapter VI A if the conditions prescribed therein are satisfied. On the basis of the aforesaid reasoning, the learned CIT(A) directed deletion of the disallowance.

5 ITA No.3312/Mum/2026 Ebixcash World Money Limited deduction under section 80G. The learned counsel appearing on behalf of the assessee, on the other hand, supported the order of the learned CIT(A) and submitted that the issue is squarely covered in favour of the assessee by several decisions of the Tribunal wherein an identical claim has been upheld.

6 ITA No.3312/Mum/2026 Ebixcash World Money Limited loses the character of a donation and therefore becomes ineligible for deduction under section 80G.

7 ITA No.3312/Mum/2026 Ebixcash World Money Limited

8 ITA No.3312/Mum/2026 Ebixcash World Money Limited Blue Dart Express Ltd. v. Pr. CIT in ITA No.1101/Mum/2024 “9. We have heard both the parties and also perused the relevant material referred to before us. First of all from the perusal of the re-assessment order which is the subject matter of revision u/s.263 by the ld. PCIT, we find that this was one of the ground for reopening and ld. AO has raised specific query as noted above on exactly same issue. The assessee has given its detailed reply and after examining those replies, the ld. AO has allowed the deduction u/s.80G holding that assessee has already disallowed CSR expenses u/s.37(1), and there is no bar for claiming deduction u/s.80G unless the same is not in accordance with the provision of the Section 80G and there is no issue of mutual exclusiveness of the claim found in this regard. Ld. PCIT has not brought on record any law or judicial precedence that such an observation and finding of the ld. AO is incorrect in law. Once the ld. AO has taken a possible view and there is no contrary law, then to take a different view in a revisionary jurisdiction u/s.263, cannot be held that the order of the ld. AO is erroneous and prejudicial to the interest of the Revenue. There is no case of invoking Explanation 2 to Section 263 which ld. PCIT has done, because ld. AO has made his enquiry and verification on the same issue. Ld. PCIT cannot cancel the assessment order to re-examine the same issue without finding any defect in such order that how the claim made u/s.80G is unsustainable in law. 10. On merits also, we find that view of ld. AO is correct in law. Claiming a deduction from computation of business income as provided from sections 28 to 44DB is different from claiming a deduction under chapter VIA of the Act which is allowed from Total Income. As per Explanation 2 to Section 37, CSR expenditure is not allowable as deduction while computing the business income under the provision of Section 28-44DB, whereas deduction u/s.80G is allowed while computing the total income under Chapter VIA. There is no pre-condition that claim for deduction u/s.80G on a donation should be voluntary. It is independent of computation of business income as it is

9 ITA No.3312/Mum/2026 Ebixcash World Money Limited allowed from Gross Total Income. The assessee had disallowed the CSR expenses while computing business income. Further, there is no dispute that the assessee has filed complete details of donation and also filed the certificate u/s.80G which was enclosed before the AO. Section 80G (1) of the Act provides that in computing total income of the assessee, they shall be deducted in accordance with the provision of Section, such sum paid by the assessee in the previous year as a donation. Deduction under Chapter VIA provides deduction from the gross total income which is computed after making necessary allowances / disallowances in accordance with Section 28-44BB of the Act including Explanation to Section 37(1). Thus, Section 37(1) and Section 80G of the Act are independent and the principles governing what is not allowable u/s. 37(1) have been provided in the section itself. Even in section 80G also, what is not allowable has also been provided under the Act. For instance, Section 80G specifically mentions two clauses, viz., section 800(2)(a)(iihk) and (iiihl), i.e., contributions towards ‘Swacha Bharat Kosh’ and ‘Clean Ganga Fund’, where donation in the nature of CSR Expenditure is not allowable as deduction under section 80G of the Act. Therefore, the disallowances for deduction under section 80G vis-à-vis CSR can be restricted to contributions made to these Funds mentioned in Section 800(2)(a)(iiihk) and (iiihl) only. It is an undisputed fact that the assessee has not claimed any deduction against the aforesaid clauses of 80G (2)(a) of the Act and as such entire donation claimed by the assessee is allowable u/s 80G. The Ministry of Corporate Affairs ("MCA") has issued "FAQs" through General circular no. 01/2016 dated January 12, 2016 (FAQ No. 6) and has clarified on the issue 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

10 ITA No.3312/Mum/2026 Ebixcash World Money Limited 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." 11. This clarification being issued by the Ministry of Corporate Affairs, Government of India clarifies that donation covered under CSR Expenses which not are eligible for the deduction under section 80G of the Income-tax Act, 1961, but are allowed under different sections. Ergo, there is nothing that if any expenditure is disallowable u/s 37 the same cannot be allowed under other provisions of Act, if the conditions of allowability are satisfied. Thus, allowing the claim of deduction u/s.80G by the ld. AO cannot be held to be unsustainable in law or amounts to erroneous and prejudicial to the interest of the Revenue. Thus order of the Ld. PCIT is reversed on this point. 12. Thus, we hold that ld. PCIT is not correct in law in cancelling the assessment order by the ld. AO on this issue. Accordingly, the order of the ld. PCIT is quashed. Consequently, the appeal of the assessee is allowed.

ACIT v. SIKKA PORTS AND TERMINALS LTD. (2025) 173 TAXMANN.COM 366]

 The assessee during the year disallowed a sum of Rs.33.85 crores under section 37 towards the CSR Spend in compliance with section 135 of the Companies Act. Since the institutions to which the said amounts are given are registered under section 8OG, the assessee claimed 50 per cent ie. Rs.16.93 crores of the same as deduction. The argument of the revenue is that the payment are made to comply with the mandate under the Companies Act, and therefore it cannot be treated as donations which are "voluntary" payments. The further argument of the revenue is that when the statute has denied the direct

11 ITA No.3312/Mum/2026 Ebixcash World Money Limited claim of the CSR spend under section 37, the assessee claiming the deduction indirectly under section 80G is against the intention of the legislature and cannot be allowed. The assessee's contention is that there is no restriction under section 80G to the effect that the contribution should be voluntary and that the CSR spend is an application of income which is eligible for deduction from the gross total income of the assessee as per the provisions of section 80G.  The word "donation" has not been defined under the Act. However the Supreme Court in the context of Expenditure Tax Act in the case of Commissioner of Expenditure Tax v. PVG. Raju(1975) 101 ITR 465 (SC) has described the meaning of the word "donation" .  Therefore to examine if CSR spending of the assessee would be a donation it is essential to examine whether the donations given by the assessee to Rellance Foundation and Shyam Kothari Foundation without any material return and without any consideration and whether it was a grant for quid pro quo. It is not the case of the revenue that the assessee has made contributions to these institutions with an Intention get something in return. The only contention of the revenue is that the contributions are made as part of a mandate and not voluntary. However, the Supreme Court in the above case has laid down the basic principle that a payment made without any material return and without any consideration and not for quid pro quo is a donation. Therefore, the payment made whether voluntarily or as part of a mandate does not negate the intention of the contribution made.  Now coming to the intention of legislature while amending the provisions of section 37 whereby the CSR spend are not allowed to be claimed as a deduction under the said section. Finance (No.2) Act, 2014 brought in the

12 ITA No.3312/Mum/2026 Ebixcash World Money Limited amendment to section 37 by inserting Explanation 2 to the said section with effect from 1-4-2015.  The "Explanatory Notes to the provisions of Finance (No.2) Act, 2014" issued by the Central Board of Direct Taxes vide its Circular No.01/2015 dated 21-1-2015 explaining the aforesaid amendment, clarifies that 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 and that 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. However, it is pertinent to note that though, the expenditure Incurred towards CSRs is not an expenditure incurred for the purpose of business, if the spend is of the nature described in sections 30 college or other institution to be used for scientific research etc., which are approved under section 35 n For example if the contribution is made to a scientific research association, or to a university or to s part of CSR spending then deduction can be allowed subject to the fulfilment of conditions prescribed under section 35. This explanatory note though self- contradictory Le, denying deduction under section 31 but allowing the assessee to claim deduction under sections 30 to 36, also makes it clear that there is no bar regarding the admissibility of CSR expenditure under any other provision of the Act, except under section 37(1). In other words, the intention of the legislature is not to restrict the right of the assessee to claim deduction towards the CSR spend if the payment is otherwise allowable under a specific provision of the Act. Further wherever the intention is to restrict the claim of deduction under any other provisions of the Act the same is explicitly provided for to that effect by the legislature. This view is supported by the Explanatory Memorandum to Finance Bill 2015 which brought in the specific restriction for claiming deduction under section 80G towards the

13 ITA No.3312/Mum/2026 Ebixcash World Money Limited CSR spend towards donation to Swachh Bharat Kosh and Clean 80G is against the intention of the legislature which restricts the same to be claimed as a deduction under Ganga Fund. Therefore, the contention that the CSR spend being claimed as a deduction under section section 37 cannot be appreciated.  The next issue is whether the impugned payments are otherwise eligible for deduction under section 80G It has already been established that the payments made by the assessee are donations and therefore if the other conditions for the deduction under section 80G are fulfilled then there should not be any restriction for the assessee to claim the deduction. Before holding so the contention of the revenue that the payments made towards CSR spend are monitored and controlled by the assessee and are not voluntary is addressed section 135 of Companies Act 2013, there are many prescribed modes and activities under Schedule VII In this regard it is relevant to note that though there is a statutory obligation of CSR expenditure under CSR expenditure, (the list is not exhaustive but of other section 135 of the Companies Act nor Schedule VII to the Companies Act nor the CSR Rules, mandates donations to the institutes/funds prescribed under section 80G. Therefore, there is merit in the submission of the assessee that though the quantum of CSR spend is mandatory there is no mandate on how amount is to be spent or to whom the contribution is to be made. Accordingly the act of the assessee to choose to Reliance Foundation and Shyam Kothari Foundation which are eligible to accept donations under section 80G is voluntary and is not mandated by section 135 of the Companies Act 2013. Further from the perusal of CSR Rules as applicable in assessee's case, it is noticed that the monitoring of the CSR spend is to ensure that the same is as per the CSR policy of the company and it does not provide for monitoring the utilization of the funds by the third party donees. In any case the donations made for a specific cause does not result in denial of deduction

14 ITA No.3312/Mum/2026 Ebixcash World Money Limited which is otherwise allowable as per the provisions of section 80G.  One more point that needs to be considered while deciding the deduction under section 80G for CSR spend is that the restriction on the allowability of the said spend as provided in Explanation 2 to section 37 is for computing the business income under the provision of section 28-44DB whereas the deduction fer section 80G is claimed under Chapter VIA ie. after computing the Gross Total Income. The provisions of section 80G does not impose any condition that the contribution should be voluntary and provefore when the CSR spend is evaluated independently under the provisions of the Act, it is viewed that there is no restriction for the assessee to claim deduction under section 80G provided the CSR spend meets the conditions specified therein. In other words, the provisions of section 37 is computation provision whereas section 80G is a beneficial provision which allows deduction towards payments made by the assessee for charitable purposes and therefore these two sections are independent of each other. For example, when a company which is not required to comply with the provisions of section 135 of the Companies Act 2013 makes a donation or a company makes donations in excess of 2 per cent even then the payment may get disallowed under section 37 but in that case the revenue would not impose any restriction to evaluate the payment for claiming deduction under section 80G. If the same analogy is applied to the CSR spend it is viewed that the assessee should be able to claim deduction under section 80G if the other conditions are fulfilled. Denying the claim for the reason that there is a specific mention under section 37 for disallowance and that the payments are made in compliance with section 135 of the Companies Act is not legally tenable unless there is an explicit provision for e.g. contributions towards "Swacha Bharat Kosh" and "Clean Ganga Fund.

15 ITA No.3312/Mum/2026 Ebixcash World Money Limited  In view these discussions and considering the judicial precedence in this regard, it is viewed that there is no infirmity in the order of the Commissioner (Appeals) in allowing the deduction under section 80G to the assessee towards donations made to Reliance Foundation and Shyam Kothari Foundation. Accordingly the grounds raised by the revenue are dismissed.

16 ITA No.3312/Mum/2026 Ebixcash World Money Limited disallowance of Rs.1,80,00,000/- claimed by the assessee under section 80G. Consequently, the grounds raised by the Revenue are dismissed.

Order pronounced on 19th June, 2026.

Sd/- Sd/- (GIRISH AGRAWAL) (AMIT SHUKLA) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated 19/06/2026 KARUNA, sr.ps

Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// BY ORDER,

(Asstt. Registrar) ITAT, Mumbai