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TMI Blog2015 (4) TMI 881X X X X Extracts X X X X X X X X Extracts X X X X ..... in favour of assessee. Disallowance u/s 35 - expenses on scientific research development - AO found that this claim cannot be granted as the expenditure has not been capitalised in the books of account but shown as waiting as such - whether there was no requirement of any project being completed or the entire amount capitalised in the books of account as reported by the auditors? - Held that:- . The Tribunal found that once there is no dispute that such expenditure is incurred and the legal provision not warranting any further capitalisation of the amont and in the books of account, the Assessing Officer and the Commissioner erroneously rejected this claim. The Tribunal has also taken care to observe that when the Assessing Officer fou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issions of Mr. Pinto that it should be admitted simply because assessee's appeals from that order and impugning a part of it has been admitted. The Revenue has to independently satisfy us that this appeal raises substantial questions of law. 3. Mr. Pinto would submit that the same indeed raises substantial questions of law. In that he projects the questions at pages 5 (6.1, 6.2 and 6.3). 4. However, in relation to para 6.3 he concedes that a judgment of a Division Bench of this Court in the case of Godrej Boyce Manufacturing Company Limited vs. Deputy Commissioner of Income Tax 328 ITR 81 covers the controversy against the Revenue and in favour of the assessee. Following that, we do not think that question 6.3 is a substantial q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncurs the expenditure of a capital nature on scientific research and there is no requirement that such an expenditure should be capitalised in the books of account. The Tribunal found that once there is no dispute that such expenditure is incurred and the legal provision not warranting any further capitalisation of the amont and in the books of account, the Assessing Officer and the Commissioner erroneously rejected this claim. The reasoning in paragraph 13 of the Tribunal's order is not only in consonance with the factual position, but the plain language of section 35 of the Income Tax Act, 1961. The Tribunal has also taken care to observe that when the Assessing Officer found that the expenditure on research and development is eligibl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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