TMI Blog2017 (10) TMI 1417X X X X Extracts X X X X X X X X Extracts X X X X ..... riod of approval. As per the certificate issued by the competent authority in Form 3CM assessee's R&D facility has been approved for the period from 01- 04-2011 to 31-03-2013 on the basis of application filed by the assessee in prescribed form 3CK on 12-08-2011. Therefore, we are of the view that the assessee is not entitled for weighted deductions towards its R& expenditure for the assessment year under consideration. - Decided against assessee. - IT Appeal No. 4381 (Mum.) of 2015 [ASSESSMENT YEAR 2011-12] - - - Dated:- 11-10-2017 - D.T. Garasia And G. Manjunatha, JJ. T. Ravindran for the Appellant. Suman Kumar for the Respondent. ORDER G Manjunatha, This appeal filed by the assessee is directed against the order of CIT(A)- 17, Mumbai dated 09-06-2015 and it pertains to AY 2011-12. The assessee has raised the following grounds of appeal:- 1. As per facts Circumstances of the case the learned Commissioner of Appeals erred in confirming AO's order disallowing weighted deduction u/s. 35 (2AB) of Income-tax Act despite Laboratory is Recognized by Department of Scientific Industrial Research, Government of India. 2. As per facts circumstanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... along with necessary approvals from competent authority. In response to notice, the assessee has filed details of research and development expenditure incurred in its in-house research and development facility and claimed that its research and development facility has been approved by Department of Scientific and Industrial development Research and the approval was accorded on 31-10- 2012 for the period from 01-04-2011 to 31-03-2013. The assessee further submitted that though its research and development expenditure has been approved for the assessment year 2012-13 onwards, its research and development expenditure has been recognized by the Secretary, Department of Scientific and Industrial development Research, therefore, it can continue to claim weighted deduction even though the certificate of approval has been given on a subsequent date. The AO, after considering the explanations of the assessee and also on analyzing the provisions of section 35AB observed that it is very clear from the provisions of section 35(2AB) that the approval for research and development by the prescribed authority is mandatory and then only deduction could be claimed and allowed post fact compliance o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ofar as decision relied upon by the assessee, the CIT(A) observed that in the case of Claris Lifesciences Ltd (supra), the facts are altogether different from the facts of the present case. Therefore, the case laws relied upon by the assessee cannot be applied to the facts of assessee's case. With these observations, the Ld.CIT(A) upheld rejection of weighted deduction claimed by the assessee u/s 35(2AB) of the Act. Aggrieved by the order of Ld.CIT(A), the assessee is in appeal before us. 5. The Ld.AR for the assessee submitted that the Ld.CIT(A) erred in confirming disallowance of weighted deduction claimed u/s 35(2AB) of the Act despite assessee's R D facility is recognized by Department of Scientific and Industrial Development Research, Government of India. The Ld.CIT(A) erred in rejecting the claim merely because the recognition is not in prescribed form 3CK and 3CM which is only a technical compliance, otherwise, the assessee's facility is recognized by the competent authority which enables the assessee to claim weighted deduction u/s 35(2AB) of the Act. The Ld.AR, referring to the decision of Hon'ble Gujarat High Court in the case of Claris Lifesciences L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... because the competent authority has approved the assessee's R D facility wef 01-04-2011 onwards. The AO further observed that the assessee has filed an application in prescribed form 3CK on 12-08-201 and the competent authority has issued approval in prescribed form 3CM from 01-04- 2011 to 31-03-2013. Therefore, the assessee is not entitled for weighted deductions for the year under consideration. It is the contention of the assessee that date of approval is not material for the purpose of claiming weighted deduction, if the facility is recognized by the competent authority. The assessee further contended that its R D facility has been recognized by the competent authority i.e. Secretary, Department of Scientific and Industrial Development Research, Government of India and the formal approval has been accorded in prescribed form wef 01-04-2011 to 31-03-2013 but the assessee has incurred R D expenditure in the impugned financial year relevant to AY 2011-12, therefore, the assessee is eligible for weighted deduction u/s 35(2AB) of the Act. The provisions of section 35(2AB) provides for weighted deduction of 200% on research and development expenditure incurred by the assessee i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee's case. The assessee has also relied upon the decision of Hon'ble Gujarat High Court in the case of Maruti Suzuki India Ltd (supra). We have gone through the case laws relied upon by the assessee in the light of the present case and find that the Hon'ble Delhi High Court under the facts and circumstances of the case has directed the competent authority, i.e. DSIR has been directed to issue a fresh certification in form 3CH in respect of the expenditure and also directed Respondent No.2, i.e. the AO to give consequential deduction as per section 35(2AB) of the Act. The facts are altogether different. Since the competent authority is not a party before us, we do not have any power to give directions to the competent authority, i.e. the Secretary, Department of Scientific and Industrial Development Research, Government of India to give post facto approval to the assessee for its R D facility. Therefore, we are of the view that the case laws relied upon by the assessee has no application to the facts of the present case. 9. In this view of the matter and considering the facts and circumstances of the case, we are of the considered opinion that the assessee is ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
