TaxTMI 
TaxTMI 
2021 (2) TMI 716
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....weighted deduction of Rs. 28.05 lakhs under section 35(2AB) of the Income Tax Act, 1961. 3. Brief facts of the case are that the assessee-company at the relevant time was engaged in manufacturing of fine chemicals. It has filed its return of income on 28.11.2014 declaring total income at Rs. 20,67,82,140/-. The case of the assessee was selected for scrutiny assessment and notice under section 143(2) was issued and served upon the assessee. A perusal of the record would indicate that the assessee has claimed deduction of Rs. 55.22 lakhs under section 35(2AB) of the Act. The ld. AO has perused this claim and observed that a perusal of the copy of form no. 3CL would indicate that the assessee has incurred an expenditure of Rs. 26.47 lakhs t....
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....en asked to produce form 3CL and 3CM for the purpose of verification of weighted deduction claimed u/s. 35(2AB) of the Act. The appellant has duly furnished all the relevant details in support of its claim taken u/s. 35(2AB) of the Act. During the assessment proceedings, the Ld. AO has taken certain figures from Form 3CL and contended that the appellant has taken excess claim of Rs. 28,05,000/-, without in depth study of Form 3CL and Form 3CM. Consequently, an addition of Rs. 28,05,000/- has been made by the Ld. AO which is absolutely incorrect. In response to the same, we hereby produce facts and figures related to deduction claimed by the appellant u/s. 35(2AB) of the Act: Details of expenses occurred for R & D expenditu....
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....partment of Scientific & Industrial Research, Ministry of Science & Technology, Government of India, the company has produced all the above figures for approval. The Department of Scientific & Industrial Research has duly approved the figures and granted a certificate to the appellant company. From the above table, it can be verified that the appellant has claimed deduction u/s. 35(2AB) of the Act in accordance with an approval from Department of Scientific & Industrial Research. While referring to assessment order, It Is apparent that the Ld. AO has merely considered expenditure of Rs. 26.47 Lacs and compared the same with deduction claimed of Rs. 55,22,000/-, without verification of all the expenses Incurred for R & D Pu....
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....47 lakhs eligible for deduction u/s. 35(2AB). The AO has allowed deduction u/s. 35(2AB) on the basis of Form No. 3CL only and hence, I find no infirmity in the action of the AO. Accordingly, disallowance made by the AO on this account is confirmed and Ground 2 is dismissed." 5. With the assistance of the ld. representatives, we have gone through the record carefully. There is no dispute with regard to the fact that facility of the assessee engaged in research activity has duly been certified by DSIR. Thus, there is no dispute with regard to the fact that deduction under section 35(2AB) of the Act is admissible to the assessee. The AO himself has granted this deduction. The dispute remains for quantification of the amount on which this de....