“CSR expenditure”
The decision most relied on for CSR expenditure is JMS Mining (P.) Ltd. v. PCIT (130 Taxmann.com 118), cited in 93 judgments on BharatTax.
Leading authorities on CSR expenditure
Donations made as part of Corporate Social Responsibility (CSR) expenditure are eligible for deduction under Section 80G if all conditions of Section 80G are satisfied. Such expenses are not automatically disallowed merely because they are CSR expenditure, in the absence of specific amendments to Section 80G similar to those in Section 37(1).
Section 263 cannot be invoked to revise an assessment where the Assessing Officer has made an enquiry, examined the details submitted by the assessee, and applied their mind to be satisfied about the admissibility of a claim.
Expenditure incurred by a Government undertaking towards implementation of the 20-point programme, as per specific directions of the Government, is allowable as business expenditure, even if voluntary and not statutorily mandated.
Expenditure incurred voluntarily for Corporate Social Responsibility (CSR) purposes is not disallowed if Section 37(1) Explanation 2, which applies to statutory obligations, is not triggered. Additionally, Section 37 is prospective from AY 2015-16, making it inapplicable for AY 2013-14 disallowances.
Corporate Social Responsibility (CSR) expenditure cannot be claimed as a deduction under Section 80G because it is a statutory mandate and lacks the voluntariness required for donations. This principle applies even when CSR contributions are made to funds like the Prime Minister's National Relief Fund or other eligible charitable institutions.
Expenditure incurred to promote business or bring goodwill to the assessee is allowable as a deduction. However, notional losses arising from issuing shares below market price are not deductible.
Contributions made by a company for Corporate Social Responsibility (CSR) to a registered charitable institution can be treated as akin to corpus donations, potentially allowing for deduction under Section 80G of the Income Tax Act, provided other conditions are met.
Expenditure on Corporate Social Responsibility (CSR) activities is an allowable deduction under section 80G of the Income Tax Act, provided the conditions stipulated in section 80G are met, irrespective of being part of CSR expenditure.
