Question And Answer
Subject: donation to political party
Querist: bs
Answered by:
Date: April 26, 2023
Query asked by bs

will deduction be denied to donor if certificate of such donee party is revoked after donation is given ?

can 115bbe be invoked ?

will it attract 200% penalty u/s 270A?

can penalty be imposed u/s 271AAc in addition to 270A?

Can penalty be levied u/s 271AAD in addition to above said penalties ?

Is prosecution possible ?











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Answer given by

: In CIT v. Chotingrai Tea & Others (2002) 258 ITR 529 / (2003) 126 Taxman 399 / 179 CTR 103 (SC) the Court held that once it was found that the assessee had fulfilled all the conditions which had been laid down under section 35CCA of the Act for claiming deduction of the amount donated by it, there was no further obligation on the part of the assessee to see that the amount was utilized for the purpose for which it was donated. Further, the deduction was allowed on the certificate furnished and it was not for the assessee to show whether the institution to which the money had been donated was carrying on rural development work as envisaged under section 35CCA of the Act. Accordingly the order of High Court was affirmed. The ratio is applicable to donation to pollical party . If the revenue is able to prove that the money has come back to the aassessee , the disallowance may be confirmed . The provision of section 115BBE may not be applicable . The assessee should request for cross examination of the parties to whom the donation was given . If the political party confirms the receipt of the donation , the disallowance cannot be made . Whether penalty is leviable or not is debatable issue . Prosecution is not automatic .

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