INCOME TAX ACT, 1961

Section 115BBC

Anonymous donation - Taxability - Assessee maintained complete record regarding identity of donors along with their addresses -

Assessee was educational society established with the object for imparting education and was registered under section 12A. It received corpus donations amounting to Rs. 1,19,76,200. In order to verify the genuineness of said receipts, AO issued notices under section 133(6) to 21 persons on random basis, out of which confirmations were received from 19 persons and from two persons confirmation were not received and the letters were received back. From confirmation letters the AO observed that replies were sent from Lucknow, whereas assessee was situated at Hardoi and therefore, he treated donations as ingenuine and taxed the same as anonymous donations under section 115BBC. Held: To come out of the definition of 'anonymous donation', the only requisite condition is that names and addresses from whom the donation has been received has to be maintained. Section 115BBC is silent thereafter unlike section 68 which casts an obligation on assessee to explain the amount credited in the books along with the explanation to the satisfaction of AO. The moment person receiving donations provides record containing names and addresses of persons from whom donation was received, such donation comes out of the definition of 'anonymous donations'. In the instant, case, it was undisputed fact that assessee had maintained complete record regarding identity of donors along with their addresses. Thus, assessee had established identity of donors as provided under section 115BBC and therefore, donations received by assessee could not be categorised as anonymous donations and could not be subjected to tax under section 115BBC.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. :

SUBSCRIBE FOR FULL CONTENT