2019 (8) TMI 1524

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.... Aurangabad is justified in deleting the addition made on account of disallowance of deduction u/s 35(2AB) of the Act amounting to Rs. 3,60,18,330/-, claimed by the assessee but not allowed by the DSIR. 2. Whether, On the facts & in the circumstances of the case, the Ld. CIT(A), Aurangabad is justified in interpreting the provisions of section 35(2AB) of the Act and Rule 6 of the Income Tax Rules 1962 in view of the decision of Hon'ble ITAT Hyderabad in the case of Electronics Corporation of India Ltd. (ITA No. 1106/Hyd/2011). 3. On the facts and in the circumstances of the case, the order of the AO be restored and that of the CIT(A)-1 be vacated. 4. The appellant craves leave to add, amend or alter all or any....

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....e assessee claimed deduction u/s. 35(2AB) in respect of R & D facilities. The R & D center of the assessee is approved by DSIR. However, the claim of assessee was disallowed by the Assessing Officer on the ground that as against the assessee's claim of weighted deduction of Rs. 9,85,70,330/-, the DSIR has approved Rs. 6,25,52,000/-. The contention of the assessee is that during the period relevant to assessment year under appeal DSIR has no power to quantify the deduction claimed by assessee u/s. 35(2AB). The only requirement is the recognition of R & D facility by DSIR. We find that the issue raised in the appeal is squarely covered by the decision rendered in the case of Cummins India Ltd. Vs. Deputy Commissioner of Income Tax (supra). Th....

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..... We find no merit in the said order of authorities below. 46. The Courts have held that for deduction under section 35(2AB) of the Act, first step was the recognition of facility by the prescribed authority and entering an agreement between the facility and the prescribed authority. Once such an agreement has been executed, under which recognition has been given to the facility, then thereafter the role of Assessing Officer is to look into and allow the expenditure incurred on in-house R&D facility as weighted deduction under section 35(2AB) of the Act. Accordingly, we hold so. Thus, we reverse the order of Assessing Officer in curtailing the deduction claimed under section 35(2AB) of the Act by Rs. 6,75,000/-. Thus, grounds of ap....