31 August 2010
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Donation not proved as relatable to carrying on of business - Where there was nothing on record to establish that the donation made by the assessee to the Chief Minister’s Relief Fund was directly connected with and related to the carrying on of the assessee’s business, the said donation was not allowable as business expenditure - CIT v. Industrial Development Corporation of Orissa Ltd.  249 ITR 401 (Ori.).
Donations are allowable if they satisfy the ‘expenditure’ test - If the contribution by an assessee is in the form of donations of the category specified under section 80G, but it could also be termed as an expenditure of the category falling under section 37(1), then the right of the assessee to claim the whole of it as allowance under section 37(1) cannot be denied - Mysore Kirloskar Ltd. v. CIT  166 ITR 836 (Kar.).
Donation to political party for non-business considerations is not deductible - CIT v. Scindia Steam Navigation Co. Ltd.  125 ITR 118 (Bom.)/ITAT v. B. Hill and Co. (P.) Ltd.  142 ITR 185 (All.).