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2015 (1) TMI 59 - AT - Income TaxWeighted deduction u/s 35(2AB) of the Act – In-house R & D unit - Alternate claim of deduction u/s 37 - Disallowance of 5% of business development expenditure on adhoc basis. - Held that:- Following the decision in DCIT, Circle 16(1), Hyderabad Versus M/s. Nagarjuna Agrichem Ltd. [2014 (6) TMI 396 - ITAT HYDERABAD] - the statutory formalities for getting approval u/s 35(2AB) are that application in Form No. 3CK and 3CL are to be submitted and an order of approval has to be obtained in Form No. 3CM from the prescribed authority - the assessee has not furnished Form No. 3CM either before the revenue authorities or before us for claiming weighted deduction u/s 35(2AB) - there is justification for reopening of assessment - assessee is entitled for 100% of the allowance at present and as and when received Form 3CM, weighted deduction may be allowed. Restriction placed in Section 35(2AB) will apply only in the case when amount was allowed u/s 35 itself - These two provisions are mutually exclusive but an assessee can claim a particular deduction either u/s 35 or u/s 37 so long as the amount spent is for the purpose of business – there was no merit in the AO’s contention that the amount once considered u/s 35 cannot be considered u/s 37 – Decided in favour of assessee.
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