TaxTMI 
TaxTMI 
PROCEDURE FOR MAKING APPLICATION FOR APPROVAL IN FORM 3CM AND SUBMISSION OF REPORT IN FORM 3CL
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....se R&D centre. iii. Clearly defined objectives of R&D not exceeding 6 lines. iv. Latest audited financial statement along with annual report. v. Additional information as per annexure - I of the guidelines (page 18). vi. Additional information as per Annexure-III for seed companies. vii. One page write-up clearly summarising the R&D activities taken up separately at each of the R&D centre/s recognised by DSIR. viii. Confirmation that the company does not manufacture any product listed in Schedule 11 of IT Act. ix. Total capital cost of in-house research facility, given break up of expenditure of complete research facility including cost of equipment, land & building as on 31st March of last completed financial year. x. An undertaking that the company shall reflect the capital and revenue expenditure on R&D in the schedules / notes to accounts in the audited financial statement of the company prepared for the purpose of published annual report as well as for the purpose of Income Tax returns. xi. A commitment that the company ....
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....tents Act, 1970 (39 of 1970). (2) No deduction shall be allowed in respect of the expenditure mentioned in clause (1) under any other provision of this Act. (3) No company shall be entitled for deduction under clause (1) unless it enters into an agreement with the prescribed authority for co-operation in such research and development facility and ^63[fulfils such conditions with regard to maintenance of accounts and audit thereof and furnishing of reports in such manner as may be prescribed]. (4) The prescribed authority shall submit its report in relation to the approval of the said facility to the ^64[Principal Chief Commissioner or Chief Commissioner or] ^65[Principal Director General or] Director General in such form and within such time as may be prescribed. ^66[(5) No deduction shall be allowed in respect of the expenditure referred to in clause (1) which is incurred after the 31st day of March, 2017.] (6) No deduction shall be allowed to a company approved under sub-clause (C) of clause (iia) of sub-section (1) in respect of the expenditure referred to in clause (1) which is incurred after the 31st day of March, 2008. Amendment of section 35. 15. ....
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....;of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:- 1. (1) These rules may be called the Income-tax (10th Amendment) Rules, 2016. (2) They shall come into force on the 1^st day of July, 2016. 2. In the Income-tax Rules, 1962 (hereafter referred to as the said rules), in rule 6,- (a) in sub-rule (7), for the words and brackets "Director General (Income-tax Exemptions)" wherever they occur, the words "Principal Chief Commissioner of Income-tax or Chief Commissioner of Income-tax or Principal Director General of Income-tax or Director General of Income-tax having jurisdiction over the sponsor" shall be substituted; (b) in sub-rule (7A),- (A) for clause (b), the following clauses shall be substituted, namely:- "(b) The prescribed authority shall furnish electronically its report,- (i) in relation to the approval of in-house research and development facility in Part A of Form No. 3CL; (ii) quantifying the expenditure incurred on in-house research and development facility by the company durin....
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....all be exclusively used by the First Party to carry out scientific research relating to bio-technology or manufacture or production of any eligible article or thing under sub-section (2AB) of section 35 of the Act, (iii) the First Party shall provide full co-operation to the Second Party in carrying out the Research and Development work relating to bio-technology or manufacture or production of eligible article or thing under sub-section (2AB) of section 35 of the Act,"; (B) in item (v), for the words and brackets, "Director General of Income-tax (Exemptions) within a period of sixty days", the words "Principal Chief Commissioner of Income-tax or Chief Commissioner of Income-tax or Principal Director General of Income-tax or Director General of Income-tax having jurisdiction over the First Party within a period of one hundred and twenty days" shall be substituted; (iii) in Part C, for items (iii) and (iv), the following shall be substituted, namely:- "(iii) render full co-operation in carrying out the Research and Development work relating to bio-technology or manufacture or production of any eligible article or thing under sub-section (2AB) of section 35 of the Act; ....
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....al Research to the in-house Research and Development centre of the company. 8 Proposed objectives of scientific research contemplated by the company. PART B AGREEMENT Whereas,....................................(hereinafter referred to as First Party) and the Department of Scientific and Industrial Research (hereinafter referred to as Second Party), have decided to enter into an agreement, that- (i) the First Party shall maintain an in-house Research and Development facility to be approved by the Second Party, (ii) the above Research and Development facility shall be exclusively used by the First Party to carry out scientific research relating to bio-technology or manufacture or production of any eligible article or thing under sub-section (2AB) of section 35 of the Act, (iii) the First Party shall provide full co-operation to the Second Party in carrying out the Research and Development work relating to bio-technology or manufacture or production of eligible article or thing under sub-section (2AB) of section 35 of the Act, (iv) the First Party shall maintain separate accounts for both revenue and capital expenditur....
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....-section(1) of section 139 to claim deduction under sub-section(2AB) of section 35; (ii) submit annual progress reports to the Secretary, Department of Scientific and Industrial Research; (iii) render full co-operation to in carrying-out the Research and Development work relating to biotechnology or manufacture or production of any eligible article or thing under sub-section (2AB) of section 35 of the Act: (iv) ensure that the company does not manufacture any product listed in the Eleventh Schedule of the Act; (v) ensure that the company shall reflect the capital and revenue expenditure on in-house research and development facility in the schedules/notes to accounts in the audited financial statement of the company prepared for the purposes of its annual report and for the purposes of computation of income-tax; (vi) submit the information as per Annexure-I and Annexure-II every year for the approved period on or before the due date specified in Explanation 2 to sub-section (1) of section 139 of the Act for furnishing the return of income; (vii) ensure that the assets acquired by the approved facility will be utilised only for th....
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.... 3. Previous year 4. Assessment year 5. A brief note on progress of each of the projects shown in the application to the prescribed authority at the time of approval. Any changes with regard to the scope of the projects as originally envisaged may be highlighted. 6. Details of any additional projects taken up during the previous year. 7. Details of changes, if any, in the research and development infrastructure during the previous year. 8. Details of research and development achievements and technologies commercialised during the previous year. 9. Details of patents obtained and/or filed during the previous year. 10. Details of any other changes in the approved research and development centre. I certify that the above details are true and correct to the best of my knowledge and belief. Signature of the Principal Officer of the company (Name, designation and address) Date : Place : Appendix - 1 to Annexure - I DETAILS OF R&D PROGRAMMES/PROJECTS IN PROGRESS Year S. No. Title & Scope of the project proposed Na....
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....l structure (a) Authorised Capital (b) Paid-up Capital 8. Category of the firm: Large / Medium / Small Scale Unit 9. Administrative Ministry Concerned: 10. Technical Collaboration, if any: (a) Foreign S.No. Product Name & Address of the Technical Collaborator History of Collaboration (b) Indian S.No. Product Name & Address of the Technical Collaborator History of Collaboration (c) Details of R&D collaboration entered with/applied for 11. Annual turnover for the last 3 years (Rupees in Lakhs): Year Indigenous Export Total 12. Main products manufactured S. No. Product Licensed Capacity, if any Installed Capacity Yearly Production for the last 3 Years 13. Total manpower employed by the firm including those of R&D: (a) Scientific & Technical having gra....
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....o you have a full time R&D Director/Head? if so, (a) Name & Designation (b) Qualification (c) Experience Date of appointment to the post Contact Nos (Telephone, Mobile, Fax and Email) 11. Details of R&D achievements made during the past 3 years: (a) New products developed (b) New processes developed (c) Improvement in existing production process(s) (d) Energy conservation (e) Pollution control (f) Import substitution (indicate items developed and foreign exchange earned). (g) Seminars/symposia attended by R&D staff (attach a separate sheet giving details) (h) Number of papers published (attach reprints if available) (i) Number of R&D personnel who attended R&D training (Give details in a separate sheet). 12. Patents filed in India or abroad during the last 3 years: S. No. Products/Process Names of the Country Year Patent No. 1 2 3 4 5 13. Whether any of the new technologies developed by the company have been (a) commercialised by the company S.No. Technology Year of commercialisa....
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....; c) Graduates/ Engineering Graduates d) Diploma Holders e) Others Total 21. (a) Have you obtained any assistance/purchased know-how from NRDC or any of the National laboratories/universities/IIT's/other institutions during the last 3 years? If so, please give details along with year and source. (b) Whether any of the items of R&D work in progress or proposed by you is being done elsewhere in country. If so, please indicate location. 22. Do you have necessity of collaborative R&D efforts for projects with CSIR or any other National Laboratories/institution? 23. Indicate briefly any incentives/benefit derived from the recognition of In-house R&D unit other than those mentioned in Column 18 &19. I hereby certify to the best of my knowledge and belief that all the particulars furnished above are correct and complete. I agree to comply with the terms and conditions of recognition as laid down by the Department of Scientific & Industrial Research, Ministry of Science and Technology, New Delhi and via lotion of the same may lead ....
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.... 8. Breakup of the capital assets as reported in the annual report/ audited financial statement as per the following table: (Amount in Rs. Lakhs) Description Manufacturing Quality Control R&D Total As on 31st March 2012 Additions during the year As on 31st March 2013 (Note: The years mentioned above are only indicative.) 9. Annual turnover of the company during the last three years on products launched based on technology developed in house as per the following table (in order to have an assessment on the effectiveness of R&D efforts): (Amount in Rs. Lakhs) Year Total Annual Turnover Total R&D Expenditure Turnover based on products developed in house and launched during the last three years Ratios Domestic Export Total 6/2 6/3 1 2 3 4 5 6 2012-13 (Note: The year mentioned above is only indicative.) 10. Annual production (in units) of the eligible produc....
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.... designation and address) Place : Date : NOTE: The totalled cost should tally the claim amount. *The expenditure on each utility should be given separately. The expenditure shall be claimed only if the utility is exclusively meant for the R&D centre or the consumption of the utility by R&D is separately metered and recorded. Appendix I to Annexure-II Additional Information to be submitted separately for each R & D Centre approved by the Prescribed Authority U/S 35(2AB) of I.T. Act at the time of reporting of the expenditure by secretary DSIR as per Form 3CL Accounting Year: Assessment Year: 1. A brief note on progress of each of the projects shown in application to Prescribed Authority at the time of approval. Any changes with regard to the scope of the projects as originally envisaged and the manpower working on the project may be highlighted. 2. Details of any additional projects taken up during the year. 3. Details of changes if any in the R&D infrastructure/and staff along with bio-data of any new R&D staff recruited and qualification-wise break-up of existing staff. 4. Details of R&D achievements and technologies commercialized dur....
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....ture on any payments made to members of the board of Directors or any other part time employees working for R&D. Signature & Seal of the Statutory Auditor Date : Place: FORM NO. 3CL [SEE RULE 6] Report to be submitted by the prescribed authority to the Income-tax Authority specified under section 35(2AB) of the Income-tax Act, 1961 1. Name and address of the registered office of the company including Telex/FAX/Phone No. 2. Permanent Account Number (PAN) of the company 3. Name and designation of the Principal Officer of the company 4. Nature of business/activity of the company (i) Business of biotechnology (ii) Manufacture/production of any eligible article or thing under sub-section (2AB) of section 35 of the Act. (Please specify) Part A 1. Annual production of the eligible products of the company during the past three years. 2. Proposed objectives of scientific Research contemplated by the company. 3. Whether the nature of the business is related to the proposed objectives of the scientific research contemplated by the company. 4. Details of the nature of existing in-house Research and Developmen....
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....__; Capital Rs. _____; Land and Building Rs._____; others Rs.____) reported for the financial year ________ relevant to the assessment year ______ is correct to the best of my/our knowledge and belief as per the result of the audit of the approved research and development centre carried out by me/us. Also the research and development capital expenditure is reflected on page ____ and revenue expenditure on page _____ in the audited financial statement/annual report. ______________ Signature of Accountant ** Name of the Accountant Address of Accountant Membership No.: Date: _________ Place: _________ Notes: 1. * Delete whichever is not applicable. 2. ** This report has to given by Accountant - Accountant means an accountant as defined in the Explanation below sub-section (2) of section 288 of the Income-tax Act, 1961. Annexure-III A. The following documents along with application in Form 3CK and Annexure III of DSIR guidelines also need to be submitted for comprehensive assessment of R&D efforts of seed companies. 1. Details of laboratory facilities available exclusively for R&D along with specialized lab facilities ....