- (1.) The Court : The following question of law has been referred for our opinion :- "Whether, on the facts and in the Circumstances of the case, the Tribunal was justified in allowing the deduction under section 35CCA of the Income-Tax Act for Rs.15,00,000/- in respect of donations of Rs.7,50,000/-each to M/s. Jayashree Gram Vikash Trust and M/s. Jagannath Rural Development Kendra?"
(2.) The facts are indeed very short and simple. The assessee claimed deduction under section 35CCA of the Income-Tax Act in respect of two donations of Rs. 7,50.000/- each made by the assessee to two Institutions, namely Jayshree Gram Vikash Trust and Jagannath Rural Development Kendra. The deductions under section 35CCA were disallowed by the ITO and the CIT(appeals) on the ground that either the aforesaid two Institutions were not traceable after notices were issued to them under section 131 of the Income Tax Act or that these two Institutions were actually not carrying out the rural development work as was envisaged under section 35CCA of the Act and for which approval had been granted by the prescribed authority to these two Institutions under that section. The Tribunal did not agree with the findings of the ITO and the CIT (Appeals) and instead held, while setting aside their orders that it was not part of the assessee's obligation to either keep track of the movement of the Institutions or to find out as to whether the rural development work was actually being carried out or not. We find ourselves in agreement with the view expressed by the Tribunal and for the reason indicated herein below.
(3.) Under section 35CCA of the Income-Tax Act, every assessee who incurs any expenditure by way of any sum which he donates to an Association or Institution which has as its object the undertaking of any programme of rural development and the donation is meant for being used for carrying out the aforesaid programme of rural development approved by the prescribed authority, an assessee is entitled to be allowed a deduction of the amount of such expenditure incurred by him during the previous year. The only condition for claiming deduction is for the assessee to furnish a certificate from the association or the institution to the effect that the prescribed authority had approved the association or the institution before the 1st March, 1983 and the training of persons for implementing any programme of rural development had been started by the Association or Institution before 1st March, 1983.;