TaxTMI 
TaxTMI 
2025 (4) TMI 2077
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.... 2. Following grounds have been raised in this appeal: - "1. Because the order passed by the CIT (Appeals) is against the facts and circumstances of case and is also grossly illegal hence is unsustainable. 2. Because, Id. CIT(A) is grossly erred in sustaining the disallowance of claim of Rs. 93,16,742/- u/s 35(2AB) of Act, without appreciating the undisputed fact that assessee is granted certificate by the prescribed authority, DSIR, in terms SS (1) of said provision and AO himself could not have sit over the decision of said authority, thus disallowance is beyond jurisdiction, defeating the very provision itself. 3. Because, Id. CIT(A) further failed to appreciate that claim of expenses are allowed and accounts a....
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....) on 27.09.2013 declaring income of Rs. 14,38,68,900/-. The case was scrutinized and consequential assessment was completed at income of Rs. 15,43,20,900/-. The assessee's claim of deduction of Rs. 93,16,742/- under section 35(2AB) of the Act was denied by the Assessing Officer (hereinafter, the 'AO') on the following reasoning: i. The assessee had not maintained separate books of accounts for the R & D activity. ii. The Director had admitted in his statement recorded before the AO that the R & D staff had been occasionally used for business purposes also. iii. There was violation of guidelines for seeking approval under section 35(2AB)of the Act. iv. The value of closing stock and consumables were very l....
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....ized for any investment in shares resulting exempted income and trading in shares were not the business objective of the assessee. 5. On the other hand, the Ld. Sr. DR contended that in view of amended Rule 6 of the Income Tax Rules, the provision for quantification of scientific research and development expenses had been prescribed by way of Finance Act, 2016 year 2017-18 onwards only and prior to that quantification prescribed allowed the weighted deduction as claimed by the assessee and certified by the auditor of the company. The AO had rightly commented on the shortcoming and disallowed the claim under section 35(2AB)of the Act. 6. We have heard both parties at length and have perused the material available on the record. We find....
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....diture including capital and revenue expenditure has been approved. As far as claim of expenditure is concerned, there is no dispute between the parties. The dispute is on the allowability of the claim under section 35(2AB) of the Act. The facility has been recognized and necessary certification has been issued by the prescribed authority. The quarrel revolves around the fulfillment of some technicalities. In the digital format of accounts maintenance, we do not find merit in the AO's finding regarding maintenance of separate books of account for R & D facility. We have perused the statements of Directors and are of the considered view that the AO has read between the lines and has drawn farfetched inferences. The expenditure in this regard....
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....sultant quantum of exempted income clearly show that the appellant assessee is actively involved in the investments resulting exempted income. The appellant assessee has not made any disallowance under section 14A of the Act. But it cannot be ruled out that the assessee would have not incurred any expenditure on this score. The AO and the Ld. CIT(A) has given the detailed justification in their orders for the disallowance made under section 14A of the Act. The finding of the Ld. CIT(A) has not been controverted by the Ld. Counsel. It is found that the appellant assessee has not taken into account the administrative, establishment and managerial expenditure for working out the disallowance under section 14A of the Act. 8.1 There is specif....