Deduction is available under this section if expenditure is incurred by assessee in respect of
- Payment to a public sector company or a local authority or to an association or institution approved by the National Committee for carrying out any eligible project or scheme.
- Direct expenditure for any eligible project or scheme (allowed only in case of a company)
If a deduction is claimed and allowed under section 35AC, the same is not allowed as a deduction in any other provisions of the Act.
The following certificates are required for claiming deduction
- If payment is made – In form 58A by the receiver
- If direct expenditure is made by company- In form 58B by the Chartered Accountant
In a case where payment is made to the specified persons and subsequently its approval is withdrawn, deduction is not denied.