532. 100 per cent tax relief for donations made to Chief Minister’s Earthquake Relief Fund, Maharashtra
Circular No. 678 was issued by the Central Board of Direct Taxes on 10 February 1994. Its subject is 532. 100 per cent tax relief for donations made to Chief Minister’s Earthquake Relief Fund, Maharashtra.
Confirms that donations to the Chief Minister's Earthquake Relief Fund, Maharashtra, set up after the September 1993 earthquake, qualify for 100 per cent deduction under section 80G without any ceiling, and that donations made for earthquake relief to the Chief Minister's Relief Fund before that fund was set up get the same treatment. It authorises Drawing and Disbursing Officers to allow the full deduction while computing employees' salary tax, on being satisfied about the amount donated and the evidence of its receipt by the fund. Where employees give through the pay bill and the fund issues one receipt for the lump sum, the employer must send the fund a list of donors, designations and individual amounts with the cheque, get it countersigned, and issue each employee a certificate giving the deduction amount, the pay bill number and date and the cheque number and date.
The Board was receiving queries from various quarters on whether DDOs could allow the 100 per cent deduction from salary, following the Government's press note announcing the concession after the Maharashtra earthquake.
532. 100 per cent tax relief for donations made to Chief Minister’s Earthquake Relief Fund, Maharashtra
In the wake of the unfortunate earthquake which caused wide-spread devastation in certain areas of Maharashtra in the month of September, 1993, the Government of India has issued a Press Note informing the general public that all donations made to the Chief Minister’s Earthquake Relief Fund, Maharashtra, will qualify for 100% deduction, without any ceiling.
2. It was also stated in the Press Note that all donations made to the Chief Minister’s Relief Fund for earthquake relief, prior to the setting up of the fund mentioned in para 1 above, would also qualify for 100% deduction.
3. The Board have been receiving queries from various quarters as to whether the Drawing and Disbursing Officers can allow 100% deduction of the aforesaid donations from salaries, under section 80G of the Income-tax Act, 1961, while computing the tax liability of the employees who make such donations. The Board have decided that the D.D.Os can do so in the case of all donors upon being satisfied about the amount donated and the evidence of its receipt by the Fund.
4. In cases where the employees of an organisation make donations to the aforesaid Fund(s) through their employers, that is, by deduction from their pay through the pay bill, it is quite possible that the amounts so deducted would be sent in lump sum to the fund and the fund would issue only one receipt for the same to the employer. In such cases the employer shall furnish to the Fund a list showing the names and designations of the donors, and the amount donated individually, alongwith the cheque for the lump sum donation and have the list countersigned by the Fund. Besides, allowing 100% deduction at his level, wherever permissible, the employer should issue a certificate to the concerned employees stating the amount of deduction made, the number and date of the pay bill, and the number and date of the cheque by which the lump sum amount including the donation made by the concerned employee(s) was paid to the Fund, so that the same could be filed by the concerned employees with their returns of income, if necessary.
5. There would be no upper ceiling for the purpose of deduction in respect of the amount donated to the funds mentioned in paras 1 and 2 above. It may, however, be noted that no deduction will be allowed if the sum donated is less than Rs. 250.
Circular : No. 678, dated 10-2-1994.
On a salary assessment or an 80G verification where the employee holds only an employer's certificate and no receipt from the fund.
An employee has Rs. 200 deducted from the pay bill for the fund. Because the sum donated is below Rs. 250, no deduction is allowable, however the employer certifies it.
Source: the Income Tax Department’s own published text — its page for this instrument.