IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH : BANGALORE BEFORE SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER AND SHRI SOUNDARARAJAN K., JUDICIAL MEMBER Assessment Year : 2020-21 M/s. Redseer Management Consulting Pvt. Ltd., Embassy Boulevard, Silver Oak The Deputy Villa No. 156, Hosahalli North Commissioner Post, of Income Tax, Near Yelahanka Air Force Base, Circle – 5(1)(1), Hunasamaranahalli, Vs. Bengaluru.

Bengaluru – 562 157.

PAN: AAECR5087K APPELLANT RESPONDENT Assessee by : Shri Siddanna, CA Revenue by : Shri Subramanian .S, JCIT-DR Date of Hearing : 10-06-2025 Date of Pronouncement : 02-09-2025

ORDER

PER SOUNDARARAJAN K., JUDICIAL MEMBER This is an appeal filed by the assessee challenging the order of NFAC, Delhi dated 30/01/2025 in respect of the A.Y. 2020-21 and raised the following grounds.

“1. The order of the learned assessing officer is erroneous on facts and in law.

2. The learned assessing officer erred in law by adding Rs. 8,50,000/- to the returned income.

3. The learned assessing officer/NFAC failed to appreciate the fact that the appellant company had voluntarily disallowed the CSR expense of Rs. 17 lakhs in the tax computation statement.

4. The learned assessing officer/NFAC failed to acknowledge that the appellant company had claimed Rs.8,50,000 as deduction U/s 80G of the Income Tax Act, 1961 ("the Act") and not U/s 37 of the Act.

5. The Hon'ble NFAC erred in holding that payment to constitute a donation, it must satisfy the test of voluntariness.

6. The appellant reserves the right to add to, alter, amend, modify or delete any of the grounds taken in this appeal. The grounds taken in this appeal are without prejudice to each other.

7. For the above grounds and other grounds which may be raised at the time of hearing, your appellant prays that the relief sought for may be granted and justice be rendered.”

2. The brief facts of the case are that the assessee is a company and doing the business of providing market research and consultancy services to the Indian as well as international companies to help them optimize their operations and define strategies through research and analytical solutions. The assessee filed their return of income on 04/02/2021 which was duly processed u/s. 143(1) of the Act. Subsequently, the case was selected for scrutiny under CASS for complete scrutiny. Statutory notices were issued u/s. 143(2) and 142(1) and the assessee also filed their objections to the said notices and also furnished the necessary documents. The AO based on the details submitted by the assessee had found that the assessee had donated a sum of Rs. 17 Lakhs to Samarthanam Trust through the corporate social responsibility scheme prescribed under the Companies Act, 2013. The said trust is also having an approval u/s. 80G of the Act. Therefore the assessee company had claimed a deduction of Rs. 8,50,000/- being the 50% of the amount donated to the said trust. The AO denied the said claim made u/s. 80G of the Act since the payment on account of CSR is not related to the business expenditure.

3. The assessee challenged the said order before the Ld.CIT(A). The Ld.CIT(A) also without considering the issue in the right perspective had dismissed the appeal on the ground that the CSR expenditure incurred by the assessee is not voluntary but it is a mandatory one as per the Companies Act, 2013.

4. As against the said order, the assessee is in appeal before this Tribunal.

5. At the time of hearing, the Ld.AR submitted that the donation made to the Samarthanam Trust is towards the corporate social responsibility scheme formulated under Companies Act, 2013 and the said donation was not claimed deduction u/s. 37 of the Act but the deduction u/s. 80G was claimed. Both the deductions u/s. 37 as well as u/s. 80G would operate in different fields and therefore the assessee submitted that the said expenditure was not claimed as exemption u/s. 37 of the Act but claimed as deduction only u/s. 80G of the Act. The Ld.AR also filed a paper book enc