TMI Blog2019 (2) TMI 980X X X X Extracts X X X X X X X X Extracts X X X X ..... ed earlier, the certificate of the DSIR in Form No. 3CL disallowing part of the expenditure was received by the assessee in November, 2013, i.e. at a much later stage, even after the AO has started enquiry with regard to assessee’s claim of deduction under section 35(2 AB) of the Act. Thus, upon considering the overall facts and circumstances of the case we are of the considered opinion that the assessee cannot be alleged of either furnishing inaccurate particulars of income or concealment of income. None of the conditions of Section 271(1)(c) of the Act in the instant case are satisfied. Accordingly we have no hesitation in deleting the penalty imposed - Decided in favour of assessee. - ITA No.5797/Mum/2015 - - - Dated:- 30-11-2018 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ic and Industrial Research (DSIR), Ministry of Science and Technology, Government of India. The assessee also submitted that all the conditions of section 35(2AB) of the Act have been fulfilled. Thus, the claim is to be allowed. After verifying the details furnished by the assessee, the AO found that as per the certificate dated 12th November, 2007 issued by the DSIR in Form No. 3CL certain expenditure claimed under section 35(2AB) by the assessee in respect of in-house R D Unit was disallowed. In this regard the assessee also made further submissions before the AO stating that an amount of ₹ 93,68,000/- having wrongly been claimed should be disallowed. On the basis of the aforesaid submission of the assessee the AO disallowed an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ber 2013 issued by the DSIR disallowing part of the expenditure claimed under section 35(2AB) of the Act. Thus, he submitted, when the assessee claimed deduction under section 35(2AB) of the Act it could not have foreseen the disallowance of part of the expenditure by the DSIR while approving the R D expenditure in the certificate issued in Form No. 3CL. The learned A.R. submitted, the assessee has claimed the deduction under section 35(2AB) of the Act as per the audit report issued by the Auditor. Thus, when the assessee received the certificate of DSIR subsequently, it revised its claim by voluntarily disallowing expenditure of ₹ 93.64 lakhs. Thus, it was submitted, neither there is concealment of income nor furnishing of inaccurate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs of income but concealed its income. Therefore, imposition of penalty under section 271(1)(c) of the Act is justified. In support of his contention the learned D.R. relied upon the decision of the Hon'ble Bombay High Court in the case of Samson Maritime Ltd. vs. CIT in ITA No. 1718 of 2014 dated 9th March, 2017. 5. We have considered rival submissions and perused the material on record. Before we decide the issue whether the provisions of Section 271(1)(c) of the Act is attracted to the facts of the present case, it is necessary to bear in mind certain crucial facts. It is a fact on record that the assessee has in-house R D facility approved by the DSIR. It is also a fact on record that the assessee has incurred both capital and re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. Thus, from the aforesaid facts it can be seen that deduction originally claimed under section 35(2AB) of the Act by the assessee was under a bonafide belief that it is eligible to claim such deduction in view of the tax audit report. This fact becomes clearer as the assessee has also sought approval of the very same amount towards R D expenditure in the application filed before the DSIR. Only in the course of assessment proceedings when the AO was making enquiry with regard to assessee s claim, assessee received the approval of DSIR in Form No. 3CL dated 12th November, 2013 disallowing a part of the expenditure. Thus, only after receiving the approval of the DSIR the assessee could come to know that part of the expenditure has not be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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