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2020 (1) TMI 397 - AT - Income TaxDeduction u/s 35(2AB) - in-house research and development facilities - HELD THAT:- Though, the assessee has produced a copy of Form 3CM before the AO, it has not attached any enclosure specifying a list of assessee’s various in-house research and development facilities, etc. Though, the assessee filed its return of income with the Revenue for the assessment year 2015-16 on 15.10.2015, it has not filed the required audit report before the competent authority with DSIR on or before 30.09.2015, as required under the provisions. From the material available on record, it is clear that the assessee filed certain particulars before the competent authority with DSIR on 22.12.2017 only, i.e., after a long gap i.e. about 2 years 3 months after the due date and almost at the end of the assessment proceedings U/s.143(3) for the assessment year 2015-16, which was completed on 26.12.2017. In order to claim the exemption from payment of Income Tax, the assessee has to comply with the provisions of the Act as well as the Rules made there under and establish it in RAMAKRISHNA DEO. [1958 (10) TMI 9 - SUPREME COURT] before the Income Tax Authorities. In this case, it is clear from the above facts and circumstances that the assessee has not laid the required material before the competent authorities in time and probably because of that they could not entertain/consider it, etc. Since the assessee has not complied with the provisions as required and has not laid the required material before the authorities concerned, the disallowance made is justified. The corresponding grounds of the assessee fail. Assessee’s alternate claim that the impugned expenditure may be considered and allowed u/s.37 - We find merit in the assessee’s claim. However, since the lower authorities have not examined this issue, we deem it fit to remit this issue back to the AO for a fresh examination. The assessee shall lay all materials in support of its contention before the AO and comply with the requirements of the AO in accordance with law. The Assessing Officer is also free to conduct appropriate enquiry as deemed fit, however, he shall furnish due opportunity to the assessee on the materials etc., to be used against the assessee and on due consideration of the assessee’s clarification / explanation shall pass the order in accordance with law. Disallowances made U/s.37 towards travelling expenses and donation - HELD THAT:- Since, the assessee has not laid any material in support of its contention either before the ld.CIT(A) or before us, we do not find any reason to interfere with the order of the ld.CIT(A). With regard to the disallowance of sales tax penalty, since the assessee has not laid any material to say that this disallowance is not warranted U/s.37, we confirm the order of the ld.CIT(A). The corresponding grounds of the assessee on these issues fail.
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