AI Drafter 
TaxTMI 
TaxTMI 
2015 (4) TMI 1247
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....f the Income tax Act, 1961 made by the Assessing Officer. 2. Any other grounds of appeal that may be raised at the time of hearing of the appeal". 2. The solitary issue pertains to disallowance of deduction claimed u/s 35(2AB), which has been sustained by the CIT(A). 3. The facts are, that the assessee is carrying on the business of providing computer aided engineering solutions to government departments, business, industry and society, to apply latest technology in numerical simulations for developing new products or customizing existing new products targeted at solving complex engineering problems. It also offers engineering outsourcing services based on software packages of customer's choice, which also includes export....
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....ipments or computers which has resulted into creation of patents. The other conditions as mentioned above in form No. 3CK for the purpose of making application to the prescribed authority and form No. 3CL granting approval of the said facility has not been furnished by the assessee. The assessee has also not complied with the conditions of maintenance and audit and separate accounts for the approved facility". 5. The AO was also of the view that the assessee had submitted a letter from Mr. R. R. Abhyankar (Scientist - G) on behalf of Govt. of India Department of Scientific Research but not from the prescribed authority, i.e. Secretary, Department of Scientific and Industrial Research. The AO also observed that the assessee has not submit....
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....counts for both revenue and capital expenditure and scientific research including that on in-house research and development facility which has to be audited. Neither before AO nor during the course of appellate proceedings any evidences were produced that the accounts have been maintained satisfying this condition. In view of these facts and legal position as discussed, I am of the considered opinion that the AO has rightly disallowed the deduction u/s 35(2AB) which is upheld". 8. The CIT(A) therefore, sustained the order of the AO, denying the weighted deduction claimed u/s 35(2AB) of the Income Tax Act, 1961. 9. Against this order of the CIT(A), the assessee is before the ITAT. 10. Before us, the AR narrated the facts, which are ....
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....section (4) provides that prescribed authority shall submit its report in relation to the approval of the said facilities to the Director General in such form and within such time as may be prescribed. Rule-6 lays down the procedure for making application and obtain approval in the prescribed form which is form no. 3CK and the prescribed authority is required to grant or approval in form no. 3CM. Thus, for the purpose of claiming deduction on scientific research expenditure under section 35(2AB), it has to be approved by the prescribed authority and the rules provide that application should be made in proscribed form and also the approval is to be granted in the prescribed form. 11. Once the assessee has filed the application in th....
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....t make any difference because it is not the fault of the assessee. In such a case, claim for deduction cannot be denied to the assessee". 12. The AR also relied on the decision of Bajaj Tempo Ltd. vs CIT, reported in 196 ITR 188, wherein Hon'ble Supreme Court held, "Since a provision intended for promoting economic growth has to be interpreted liberally ...". 13. The AR, therefore, submitted that weighted deduction was rightly claimed and must be allowed. 14. The DR relied on the orders of the revenue authorities and submitted that prescribed documents were not filed and hence the denial of weighted deduction was correct in law. 15. We have heard the rival contentions and have perused the material placed on record. It is not the....