Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2019 (4) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (4) TMI 715 - HC - Income TaxDenial of approval u/s 35(1)(ii) - educational and research activities - deemed university - demonstrate the significant scientific research activity undertaken - HELD THAT:- The reasons assigned by the respondents are, in our view, not in keeping with the statutory regime. The respondents seem to have proceeded on the basis that every department of the applicant university must undertake scientific research. However, as stated above, that is not a proper understanding of the provisions, at least insofar as they relate to universities colleges and other institutions. Similarly, Rule 5E(2) expressly recognizes that research activities may be carried out through faculty members or enrolled students of the institution. The respondents were, therefore, in error in disregarding the materials placed by the petitioner on the basis that the research projects were undertaken as part of the students’ curriculum. The respondents have also placed undue emphasis on the nature of the research undertaken and its commercialization. The petitioner submitted a significant amount of material showing the activities undertaken by it, including publication of research papers, patents granted, and grants and funds received from various national and international agencies. These have been discarded by the respondent on the ground that these research activities “have not materialized in a significant way either in form of new theories/models, new hypothesis which has wide acceptance, copyrights, earnings from patents etc.” The research papers and patents referred to by the petitioner have also been characterized as the work of particular faculty members rather than attributable to the contribution to the petitioner's university. The respondent’s focus on the impact and/or commercial success of the petitioner’s research activities is not relatable to any statutory or prescribed criteria for grant of approval under Section 35(1)(ii). Section 43(4) of the Act contains a much broader definition which has been entirely overlooked in the impugned order. Scientific research is no less so because the researcher has not discovered a new theory or invented a patentable product. These results may be achieved only after years of research, or not at all. An assessment of the “value” of the research at the hands of the respondents, is not contemplated by the Act or the Rules. Further, in view of Rule 5E (2) expressly contemplating research activity carried out through faculty members, the analysis of the respondent appears to be rather sketchy. The question required to be considered by the respondent was whether the activities claimed by the petitioner were genuine, and whether the funds being paid to the petitioner were intended for the stated purpose. On these, the impugned order is silent. It is, therefore, set aside and the respondents are directed to reconsider the petitioner's application dated 23.06.2014 in accordance with the procedure prescribed, and the principles laid down above.
|