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No ceiling on contributions to Sec. 35AC or 80GG

Donations, which qualify for deduction under Section 80G, has an upper limit of 10 per cent of the gross total income as reduced by all deductions other than the donations themselves as provided under sub-section (3). There is no such limit for contributions made for eligible profits for schemes of institutions, which have been notified by National Committee under Sec. 35AC. It is allowed in full, if paid out of business income under Sec. 35AC and in other cases under Sec. 80GG. Where the contribution made out of business income exceeds the gross total income, the excess will be treated as business loss permitted to be carried forward and set off against future income.

However, where it is paid out of income from "salary", "property" or "Other sources", it can be claimed only under Sec. 80GG for which there is no limit of 10 per cent as for Sec. 80G, but there is a ceiling by way of available gross total income of the year applicable under Sec. 80A for deductions under Chapter VI-A. Deduction under Sec. 80GG cannot, therefore, exceed the available income.

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