ITAT upholds assessee's deduction under sec 80IB(8A) for A.Y. 2012-13, emphasizing authority approval.

The ITAT dismissed the Revenue's appeal and affirmed the CIT (A)'s order for A.Y 2012-13, allowing the deduction claimed by the assessee under section 80IB(8A). The ITAT emphasized that the approval from the prescribed authority as a research and development company was sufficient to establish the assessee's eligibility for the deduction, and until such approval was withdrawn, the deduction could not be denied. The decision was consistent with previous years' findings, leading to the dismissal of the Revenue's appeal.

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Issues:
Appeal against order of CIT (A) for A.Y 2012-13 disallowing deduction u/s 80IB(8A) - Whether assessee independently carried out scientific research - Whether approval from prescribed authority sufficient for claiming deduction.

Analysis:
1. The Revenue appealed against the CIT (A)'s order for A.Y 2012-13 disallowing deduction u/s 80IB(8A) claimed by the assessee. The AO disallowed the deduction stating that the assessee, engaged in service activities, was not independently carrying out scientific research but acting as a contract researcher.
2. The CIT (A) dismissed the grounds raised by the assessee, leading to the AO disallowing the deduction u/s 80IB(8A) based on the same reasoning. The assessee appealed, relying on previous ITAT decisions in their favor for A.Ys 2008-09 and 2010-11.
3. The ITAT examined whether the assessee fulfilled conditions for claiming deduction u/s 80IB(8A). The ITAT noted that the assessee had approval from the prescribed authority as a research and development company. The ITAT emphasized that the approval and subsequent renewals indicated the authority's satisfaction with the assessee's eligibility for the deduction.
4. The ITAT held that the CIT (A) cannot override the prescribed authority's approval and deny the deduction merely based on lack of evidence. The ITAT emphasized that until the approval was withdrawn, the deduction could not be denied. The ITAT decision was specific to the A.Ys under consideration.
5. The ITAT observed that the decision for A.Ys 2005-06 & 2006-07 was followed for subsequent years based on the renewal of certificates by the prescribed authority. The ITAT upheld the CIT (A)'s order for A.Ys 2009-10, 2010-11, and 2011-12, as there were no changes in facts affecting the assessee's eligibility for deduction u/s 80IB.
6. The ITAT found no change in facts for the A.Y 2012-13 and upheld the CIT (A)'s decision to grant relief to the assessee. The Revenue's appeal was dismissed based on the consistent findings and circumstances across the years.
7. The ITAT concluded that the appeal of the Revenue was dismissed, affirming the order of the CIT (A) for A.Y 2012-13. The decision was pronounced in open court on 20th February 2019.

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