TaxTMI 
TaxTMI 
2019 (5) TMI 112
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....ribunal, in short, 'Tribunal', dated 11.02.2008, whereby the Appeal filed by the Revenue came to be dismissed and the Appeal filed by the Assessee came to be allowed for Assessment Year 2003-2004. 2. The Questions of Law, on which these Appeals were admitted by a Co-ordinate Bench of this Court on 08.09.2008, are quoted below for ready reference : (1) Whether on the facts and in the circumstances of the case, the Tribunal was right in granting relief under Section 35 (2AB) of the Income Tax Act when the Assessee has not produced the relevant approval from the prescribed authorities for the claim for weighted deduction under Section 35 (2AB) of the Act ? (2) Whether on the facts and in the circumstances of the ca....
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.... vide letter from the prescribed authority dated 26.6.2003, it has been mentioned that the assessee's inhouse R&D Unit's application for renewal of recognition beyond 31.3.2003 had been considered and it was decided to accord renewal of recognition to the Unit up to 31.3.2006. The learned counsel of the assessee further produced letter dated 10.7.2000 whereby, by reference to similar application for recognition beyond 31.3.2000, the concerned authority had decided to accord renewal up to 31.3.2003. Again, vide letter dated 24.4.1997, with reference to application for renewal of recognition beyond 31.3.1997, the renewal was accorded for a period up to 31.3.2000. The learned counsel of the assessee further submitted that assessee had ....
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....and relied upon the order of authorities below. 5.7. We have heard both the counsels and perused the relevant records. Admittedly, the assessee in this case fulfilled all the necessary requirements for getting weighted deduction except as per authorities below, a specific reference to the assessment year, in the approval from the prescribed authority. On perusal of documents produced, we find considerable cogency in the submissions of the assessee that it has been granted recognition long before the present assessment year and the same has been continuously renewed. It is also noted that the exemption granted is with reference to the detail of projects that were in progress during the assessment year. We further find that the durat....
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....ty, who after following proper procedure will approve the facility or otherwise and the assessee will be entitled to weighted deduction of any and all expenditure so incurred. These words refer back to the facility which is so developed. Consequently, a plain reading clearly indicates that the assessee is entitled to weighted deduction on expenditure so incurred by the assessee for development of facility. This can be viewed from another angle. Provision postulates approval of "R&D" facility which implies that a development facility shall be in existence, which in turn presupposes that assessee must have incurred expenditure in this behalf. If the interpretation of the lower authorities is accepted, it creates absurdity in this pro....
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....al is allowed.'' 4. Mr.M.Swaminathan, learned Senior Standing Counsel for the appellant-Revenue, has submitted that since the Assessee did not produce the requisite approval of the Scientific Research undertaken by him for the period in question though such approval was available for the period prior to Assessment Year 2003-2004 and for the period subsequent to it, the mandatory condition of producing the approval for the Assessment Year in question was not complied with by the Assessee and, therefore, the learned Tribunal erred in allowing such weighted deduction of expenditure incorporated under Section 35 (2AB) of the Act. 5. On the Second Question of Levy of Interest under Section 234D of the Act on the excess refund made ....
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....year in question was also under active consideration and awaited. 8. The Assessee cannot be punished for the bureaucratic delay in giving such approval for the year in question, which was in the hands of the Department concerned of the Central Government itself. On the very fact that for the period anterior and posterior to the year in question such approval was very well on the record of the Revenue, the weighted deduction for the expenditure incurred on the Scientific Research could not have been disallowed by the authorities below and, therefore, the learned Tribunal, in our view, rightly held such Scientific Research expenditure to be allowable under Section 35 (2AB) of the Act. Therefore, first two Questions of Law are answered in f....