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2012 (11) TMI 16 - AT - Income TaxExpenditure on Scientific Research - disallowance of 100% deprecation for transfer of machinery from production department to research & development department - Held that:- The assessee had purchased two machines namely Hot Setting Vaccum Plant and Plastic Injection Mounting Machine in the financial year 1994-95 for the purpose of manufacturing of its product. The machinery were installed and used for the purpose of production and the assessee claimed depreciation on it. In the year under appeal, assessee transferred the aforesaid machines from its production department to Research & Development (R & D) Department. The assessee could not furnish necessary evidence to support its contention that the machineries were actually transferred to the R & D Department from the Production Department and whether the machines were actually used for the purpose of stated research activity & also that the machineries were actually transferred to the R & D Department from the Production Department and the machines were actually used for the purpose of stated research activity. As under Section 35 what is allowable is “expenditure incurred” which means actual spending/paying of money as decided in Multi Metals Limited Versus CIT [2002 (2) TMI 98 - RAJASTHAN HIGH COURT] - against assessee.
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