TaxTMI 
TaxTMI 
TaxTMI 
2022 (9) TMI 829
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion u/s 35(2AB) claimed by the Appellant towards revenue expenditure being consultation fees which were actually in the form of remuneration and the entire R & D activities were carried out in the appellant company's premises. 3. The ld. CIT erred in holding that the claim of Appellant u/s 35(2AB) cannot be allowed without certification by the DSIR. 4. The Appellant craves leave to add, amend, alter, delete or substitute all or any of the above grounds of appeal." 2. The solitary grievance of the assessee is the confirmation of disallowance of Rs. 45.65 lakhs being weighted deduction u/s 35(2AB) of the Income-tax Act, 1961 (hereinafter referred to as "the Act") claimed by the assessee towards revenue expenditure being consultation fees....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the status of in-house research and development facilities as stipulated u/s 35(2AB) of the Act for claiming weighted deduction. Therefore, the ld. A.O held that in respect of Rs. 44.65 lakhs incurred for acquiring consultancy services of the aforesaid three professionals the assessee is not eligible for weighted deduction u/s 35(2AB) of the Act. The ld. A.O further observed that as per report of the DSIR, New Delhi, the said expenditure of Rs. 44.65 lakhs incurred by the assessee for consultancy fees was not eligible for weighted deduction u/s 35(2AB) of the Act. 4. The ld. CIT(A) on this issue observed and held as follows: 6.3 I have considered the facts of the case and law apparent from records. The assessee has filed original return....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the matter with DSIR does not mean that the qualified amount has been enhanced by the DSIR. Therefore, at this juncture the contention of the appellant is without any supporting evidence. Accordingly, the action of the AO in disallowing the weighted deduction u/s 35(2AB) in respect of revenue expenditure of Rs. 44,65,497/- is upheld and ground No. 2, 3 and 4 of the appeal are dismissed. 5. In the aforestated decision of the ld. CIT(A), it was observed that the expenditure of Rs. 44.65 lakhs being revenue expenditure were not considered as qualifying amount for deduction u/s 35(2AB) of the Act in form No. 3CL by the prescribed authority DSIR. He held that there was no question of allowing deduction u/s 35(2AB) on Rs. 44.65 lakhs without ce....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed by the DSIR where the said amount of Rs. 44.65 lakhs incurred for consultancy fees could be said to be eligible for weighted deduction u/s 35(2AB) of the Act. In fact, the DSIR had rejected expenses of Rs. 44.65 lakhs incurred for consultancy services to be part of weighted deduction u/s 35(2AB) of the Act. We find that neither before the A.O nor before the ld. CIT(A) the assessee was able to substantiate the claim of revenue expenditure in respect of Rs. 44.65 lakhs. It is not apparent either from the order of the ld. A.O or from the ld. CIT(A)'s order what relevant evidences/materials were provided by the assessee in order to substantiate its claim for weighted deduction u/s 35(2AB) of the Act. Whether the assessee was able to justify ....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... 3. That the Hon'ble Bench members instructed the assessee company to file an affidavit stating that the agreements entered into with the R & D Professionals namely, Dr. Nitant Mate, Ms. Jaymala A. Naik and Mr. Nilesh Deshpande, appointed for the in-house Research & Development unit of the assessee company were submitted by the assessee company during the respective proceedings before the A.O and before the Hon'ble CIT(A). 4. That, the assessee company had submitted the subject agreements entered into with the R & D Professionals namely, Dr. Nitant Mate, Ms. Jaymala A. Naik and Mr. Nilesh Deshpande, appointed for the in-house Research & Development unit of the assessee company before the A.O vide its letter dated 181-03-2015 su....