Jamnagar Utilities and Power Pvt. Ltd. Vs. ACIT-3(3)(1)

Parties Involved

Facts Summary

The assessee, Jamnagar Utilities and Power Pvt. Ltd., filed its return of income for the Assessment Year 2015-16 on 27.11.2015, reporting a total income of Rs. 245,74,25,110/- and a book profit of Rs. 822,06,83,524/- under section 115JB of the Income Tax Act, 1961. The case was selected for scrutiny, and the assessment under section 143(3) was completed. The assessment was later reopened under section 147 of the Act due to the assessee's involvement in Specified Domestic Transactions with its Associated Enterprises. The Assessing Officer noticed that the assessee claimed a sum of Rs. 5,50,00,000/- under section 80G of the Act, which was added back in the computation of income. The Assessing Officer disallowed the claim under section 80G, stating that CSR expenditure is a statutory obligation and not a voluntary donation. The Commissioner of Income Tax (Appeals) allowed the deduction under section 80G, relying on decisions from the Co-ordinate Bench.…

Legal Issues

• 1. Whether the assessee is entitled to claim deduction under section 80G of the Income Tax Act, 1961 for the amount expended on Corporate Social Responsibility (CSR).
• 2. Whether the reopening of the assessment under section 147 of the Act was legal.

Judgment Outcome

Decided in favour of Partly Assessee / Partly Revenue.

Precedents Relied Upon

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