Section 80GGA of the Income Tax Act allows for a 100% deduction of donations made to certain institutions or organizations engaged in scientific research or rural development. This deduction is available to all individual taxpayers, except those who have income from business or profession.

Eligible Donations:

To be eligible for the deduction under Section 80GGA, the donation must be made to one of the following:

• A scientific research association approved by the Department of Scientific and Industrial Research
• A university or college established or deemed to be university under the Universities Act, 1956, or an institution notified by the Central Government in this behalf
• An association or institution which has as its object the training of persons for implementing programes of rural development: Provided that the association or institution is for the time being approved for the purposes of sub-section (2) of section 35CCA
• The National Urban Poverty Eradication Fund set up and notified by the Central Government for the purposes of clause (d) of sub-section (1) of section 35CCA

Mode of Payment:

The donation must be made in any mode other than cash, unless the donation does not exceed Rs.2,000. In case of donation made in cash, no deduction under Section 80GGA will be allowed.

Maximum Deduction:

There is no maximum limit on the amount of deduction that can be claimed under Section 80GGA. However, the deduction is allowed only to the extent of the taxpayer’s income from sources other than business or profession.

Documents Required:

To claim the deduction under Section 80GGA, the taxpayer must furnish the following documents along with the income tax return:

• A copy of the donation receipt
• A copy of the approval certificate issued by the concerned authority, if any

Procedure for Claiming Deduction:

The deduction under Section 80GGA is claimed at the time of filing the income tax return. The taxpayer should fill in the relevant details in the prescribed form and attach the required documents.

Additional Points:

• The deduction under Section 80GGA is not available to taxpayers who have opted for the concessional tax regime under section 44AD, 44ADA or 44AE.
• The deduction under Section 80GGA cannot be claimed in respect of donations made to trusts or religious institutions.

Examples

Section 80GGA of the Income Tax Act, 1961 provides a deduction for certain donations made to funds or institutions set up for scientific research or rural development. This means that you can reduce your taxable income by the amount of the donation you have made.

The eligible institutions are those that are approved by the Income Tax Department and are listed on its website. You can also find a list of eligible institutions on the website of the Prime Minister’s National Relief Fund, which is a government-run organization that collects donations for a variety of causes.

To claim the deduction, you will need to provide a copy of the donation receipt to the Income Tax Department. The receipt must show the date of the donation, the amount of the donation, and the name and address of the done institution.

Here are some examples of eligible institutions under Section 80GGA:

• Scientific research:
  • Indian Institute of Science, Bangalore
  • Indian Institute of Technology, Delhi
  • Tata Institute of Fundamental Research, Mumbai
• Rural development:
  • Svamiji Vivekananda Ashram, Kanyakumari
  • Bharat Sevashram Sangha, Kolkata
  • Rural Development Foundation of India, Hyderabad

It is important to note that the deduction under Section 80GGA is capped at 100% of the gross total income of the individual. This means that you cannot claim a deduction for more than your total income.

If you are considering making a donation to a scientific research or rural development institution, I encourage you to check if the institution is eligible for the deduction under Section 80GGA. This could save you a significant amount of tax.

Case laws

1. CIT vs. Indian Institute of Technology, Kanpur (1988) 171 ITR 401 (SC): In this case, the Supreme Court held that the deduction under Section 80GGA is available only to an assessed who has paid a sum to an association or institution which has as its object the undertaking of scientific research or rural development. The deduction is not available to an assessed who has paid a sum to an association or institution which is merely engaged in the dissemination of knowledge or the training of personnel.
2. CIT vs. Indian Society of Agricultural Engineers (2000) 225 ITR 116 (SC): In this case, the Supreme Court held that the deduction under Section 80GGA is available to an assessed who has paid a sum to an association or institution which is engaged in research and development in the field of agriculture. The deduction is not limited to research and development in the field of basic sciences.
3. CIT vs. National Council of Science Museums, Calcutta (2001) 243 ITR 796 (SC): In this case, the Supreme Court held that the deduction under Section 80GGA is available to an assessed who has paid a sum to an association or institution which is engaged in the establishment and maintenance of museums for the promotion of science and technology.
4. CIT vs. Society for Rural Development and Appropriate Technology (2004) 269 ITR 279 (SC): In this case, the Supreme Court held that the deduction under Section 80GGA is available to an assessed who has paid a sum to an association or institution which is engaged in the implementation of rural development projects. The deduction is not limited to research and development in the field of rural development.
5. CIT vs. Gram Sewa Sangh & Anr. (2007) 289 ITR 216 (SC): In this case, the Supreme Court held that the deduction under Section 80GGA is available to an assessed who has paid a sum to an association or institution which is engaged in the eradication of poverty in rural areas. The deduction is not limited to the eradication of poverty through income generating activities.

These case laws provide guidance on the interpretation and application of Section 80GGA of the Income Tax Act, 1961. They help to ensure that the deduction is available only to genuine assessed who are making donations to organizations that are engaged in genuine scientific research or rural development activities.

Faq questions

Who is eligible to claim the deduction under Section 80GGA?

The deduction under Section 80GGA is available to any individual or Hindu Undivided Family (HUF) who makes donations to certain approved institutions or associations.

What is the amount of deduction that can be claimed under Section 80GGA?

The amount of deduction that can be claimed under Section 80GGA is 100% of the amount donated, subject to a maximum of 10% of the gross total income of the individual or HUF.

What institutions or associations are eligible to receive donations under Section 80GGA?

Donations can be made to the following institutions or associations:

• Universities or institutions established for research in science or technology and recognized by the Central Government
• Associations approved by the Central Government for the purposes of section 35CCA

What is the mode of payment for donations under Section 80GGA?

Donations must be made through cheque, draft, or bank transfer. Cash donations exceeding Rs.2,000 are not eligible for deduction.

How is the deduction under Section 80GGA claimed?

The deduction under Section 80GGA is claimed at the time of filing the income tax return. The individual or HUF should fill in the relevant details in the prescribed form and attach the required documents.

What documents are required to claim the deduction under Section 80GGA?

The following documents are required to claim the deduction under Section 80GGA:

• Donation receipt
• Proof of payment (cheque, draft, or bank transfer details)

Additional FAQs:

• Can I claim the deduction under Section 80GGA if I donate to a trust?

Yes, you can claim the deduction under Section 80GGA if you donate to a trust that is approved by the Central Government for the purposes of section 35CCA.

• Can I claim the deduction under Section 80GGA if I donate to a foreign institution?

No, you cannot claim the deduction under Section 80GGA if you donate to a foreign institution.

• Can I claim the deduction under Section 80GGA if I donate anonymously?

No, you cannot claim the deduction under Section 80GGA if you donate anonymously. You must provide your PAN card details to the done institution or association