DY. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 2(3), MUMBAI, MUMBAI vs. HINDUJA GLOBAL SOLUTIONS LIMITED, MUMBAI

The assessee challenged the disallowances before the CIT(A). It was firmly contended that the impugned payments do not attract TDS liability as the impugned services are not for any right for use or right to use any property or information or patent, invention, model, design, secret formula or process or trade mark or similar property. After considering the facts and submissions, the Ld. CIT(A) found that the Hon’ble Bombay High Court in the matter of UTV Entertainment Television 399 ITR 433 has held that the placement charges paid by the assessee are standard fees paid to cable operators and multi-system operators for placing signals or preferred bandwidth, and therefore, cannot be constituted as royalty. Further, drawing support from the decision of the Hon’ble Madras High Court in the matter of Skycell Communications Services Ltd. 251 ITR 53, the CIT(A) deleted the disallowance of Rs. 7,65,58,000/-

Insofar as the disallowance of Rs. 3,94,00,000/- is concerned, the CIT(A) found that on Rs. 2,08,01,289/- paid in India, the assessee has deducted tax at applicable rates and on payment of Rs. 1,85,98,711/- paid by the overseas branch, the assessee has deducted tax as per the Philippines tax law. The CIT(A) deleted the disallowance of Rs. 3,94,00,000/-, further drawing support from the decision of the Hon’ble Delhi High Court in the case of Estel Communications Pvt. Ltd. 318 ITR 185. P a g e | 4 ITA No. 2423 & 2424/Mum/2025 A.Y. 2012-13 & 2020-21 Hinduja Global Solutions Ltd.

Before us, DR strongly supported the findings of the AO but could not bring any distinguishing decision in favour of the revenue, nor could point out any error or infirmity in the findings of the CIT(A).

After giving a careful consideration to the findings of the CIT(A), we find that the decision of the CIT(A) is based upon the decisions of the Hon’ble juri ictional High Court of Bombay, Hon’ble Madras High Court and Hon’ble Delhi High Court (supra). We, therefore, do not find any reason to interfere with the findings of the CIT(A). ITA No. 2423/Mum/2025 is accordingly dismissed.

The only grievance of the revenue is that the CIT(A) erred in deleting the disallowance of the deduction claim of CSR donations u/s 80G of the Act by overlooking explanation 2 to section 37(1) of the Act.

Briefly stated, the facts of the case are that during the course of the scrutiny assessment proceedings, the AO noticed that the assessee has claimed deduction of Rs. 2,17,84,962/- u/s 80G of the Act with respect to donations made towards CSR activities. The AO accordingly disallowed the same.

The assessee challenged the addition before the CIT(A). Before CIT(A), the assessee strongly contended that it has not claimed the expenditure under the head CSR but has claimed deduction as donations u/s 80G of the Act. After considering the facts and submissions and drawing support from various decisions of the coordinate benches, the CIT(A) deleted the impugned addition. Before us, DR strongly supported the findings of the AO.

We have carefully considered the orders of the authorities below. It is true that the assessee has claimed donations u/s 80G of the Act and not as CSR expenses, which are now disallowable u/s 37(1) of the Act r.w. Explanation 2 thereon. The coordinate bench in the case of Motilal Oswal Securities Ltd. in ITA No. 1795/Mum/2023 order dated 18.08.2023, following the decision of the coordinate bench in the case of Allegis Services India Pvt. Ltd. in ITA No. 1693/Beng./2019 and in the case of JMS Mining Pvt. Ltd. 130 taxmann.com 118 (Kolkata Trib.) has persistently held that if the assessee satisfies the condition u/s 80G of the donees, the claim of the assessee for deduction of CSR expenses/contributionss u/s 80G has to be allowed.

Respectfully following the decision of the coordinate benches (supra), we decline to interfere with the findings of the CIT(A). ITA No. 2424/Mum/2025 is also dismissed.

In the result, both the appeals of the revenue are dismissed. Order pronounced in the open court on 09.06.2025. SAKTIJITT DEY NARENDRA KUMAR BILLAIYA (उपाध्यक्ष/VICE PRESIDENT) (लेखाकार सदस्य/ACCOUNTANT MEMBER)