TMI Blog1978 (6) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... total income? " This question arose while making the assessment for the assessment year 1969-70. Therefore, the question will have to be answered in the light of the law as it then existed. We are not concerned with the later amendments to s. 80G. A plain reading of the section itself leads to no alternative but to answer the question in favour of the assessee and to hold that he was entitled to deduction of a larger sum than Rs. 22,169. The Tribunal was clearly wrong in taking the view that sub-s. (4) of s. 80G entitled the assessee to a deduction of only 55% of 10% of the total income. The material facts and figures may be briefly noted. The assessee is the Hyderabad Race Club which is an association of persons and for the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n for the purpose of calculation of the deduction allowable under sub-s. (1). Without saying anything further and without giving any more reasons, the Tribunal came to the conclusion that the ITO was quite right in restricting the admissible deduction to 55% of 10% of the total income as, it thought, was limited by sub-s. (4). Sri Parvatha Rao challenges the correctness of the construction laid by the Tribunal on s. 80G and particularly on sub-s. (4). According to him, sub-s. (1), as it stood in the assessment year 1969-70, permits deduction of an amount equal to 55% in the case of assessees like the present assessee. That 55% is of the aggregate of the sums specified in sub-s. (2). The aggregate of the sums which come under sub-s. (2) d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee, fifty-five per cent., of the aggregate of the sums specified in sub-section (2). [2) The sums referred to in sub-section (1) shall be the following, namely :- (a) any sums paid by the assessee in the previous year as donations to- (i) the National Defence Fund set up by the Central Government; or (ii) the Jawaharlal Nehru Memorial Fund referred to in the Deed of Declaration of Trust adopted by the National Committee at its meeting held on the 17th day of August, 1964; or (iii) the Prime Minister's Drought Relief Fund; or (iv) any other fund or any institution to which this section applies; or [v) the Government or any local authority, to be utilised for any charitable purpose ; (b) any sums paid by the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee, of the aggregate of the donations given by it under any or all of the heads mentioned in sub-s. (2). However, as sub-s. (1) itself expressly states, this deduction shall be in accordance with and subject to the provisions of s. 80G. If the aggregate sum of donations is less than Rs. 250, no deduction is permissible as per the provisions of sub-s. (3). Sub-section (4) in its turn puts a ceiling limit on the deductible amounts donated for the purposes mentioned in sub-cls. (iv) and (v). of cl. (a) and in cl. (b) of sub-s. (2) that they shall not exceed 10% of the gross total income or two hundred thousand rupees, whichever is less. It is patent from the language of sub-s. (4) that it cannot be read de hors or independently of sub-s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt only to 10% of the gross total income or two hundred thousand rupees, whichever is less. If the aggregate of these three categories of donations does not exceed 10% of the gross total income or two hundred thousand rupees, then the assessing officer is bound to give deduction of the sums which constitute 50% or 55%, as the case may be. There is no warrant at all to read sub-s. (4) independently of sub-s. (1) and sub-s. (2). Doing so would be violating the very language of sub-s. (4) which, in so many terms, declared that it is only a qualification to sub-s. (1). Such being the correct manner of giving deduction in respect of donations under s. 80G, the Tribunal went wrong in holding that the assessee-club in this case is entitled to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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