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2014 (4) TMI 531 - ITAT MUMBAIDisallowance of weighted deduction u/s 35(2AB) of the Act – In-house R&D scientific research - Nature of expenses – Capital or revenue – Held that:- The assessee has made claim for the deduction u/s 35(2AB) which is for expenditure incurred on in-house R&D facilities - The letter issued by DSIR is only for renewal of recognition of in-house R&D units - There is no formal order or approval for such inhouse R&D facilities in the prescribed form under section 35(2AB) - The assessee could not show as to whether any approval of in-house R&D facilities has been issued in prescribed form by the DSIR, even if it is signed by any authority like Scientist-G for on/or behalf of the Secretary, DSIR - in the subsequent years, if such an order is available, then the assessee has to show that the order of the approval for in-house R&D facility has been granted by the DSIR covering the present assessment year – thus, the order of the CIT(A) is set aside and the matter is remitted back to the AO for verification of the fact as to whether any order of approval of inhouse R&D facilities has been issued for the relevant assessment year – Decided partly in favour of Assessee. Disallowance of bad debt – Held that:- In the case of Auribindo Pharma, the assessee had shown the amount of bad debt written of at Rs. 8,24,978 - the AO has taken the figure of Rs. 1,08,48,951, which pertained to different parties - to this extent, only the figure of Rs. 8,24,978 should be taken into consideration for the purpose of adjudication - otherwise the observation and conclusion of the CIT(A) are absolutely correct and is in accordance with the law that the AO has to examine the conditions laid down in section 36(1)(vii) and whatever amount has been written of in the books of account as bad debts the same should be allowed – Relying upon TRF. LTD. Versus COMMISSIONER OF INCOME-TAX [2010 (2) TMI 211 - SUPREME COURT – there was no infirmity in the order of the Commissioner (Appeals) – Decided partly in favour of Assessee. Claim of Deduction u/s 80G and section 80IB of the Act – Held that:- The contention of the assessee is legally tenable because at the time of filing of return of income, the net income was in loss - the claim of deduction u/s 80IB had no meaning - if the income is assessed at positive figure, then the same has to be allowed as deduction – Decided partly in favour of Assessee.
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