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TMI Blog2018 (4) TMI 1686X X X X Extracts X X X X X X X X Extracts X X X X ..... entists and other guests at the R & D facilities. CIT (Appeals) and the Tribunal have come to a facutal finding that it had a direct relation to the assessee's R & D activity. This question is therefore, not entertained. Deduction u/s. 10B - Determination of book profit relying on the decision of Ajanta Pharma reported in [2010 (9) TMI 8 - SUPREME COURT]. Conversion of convertible bonds into equity shares - HELD THAT:- CIT (Appeals) therefore observed that, it was undisputed that the FCCB works for the purpose of capital expansion of the business since the proceeds could be used only for such purpose. He was therefore of the opinion that the proceeds for the purpose of capital expansion would be on capital account only and therefore n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee was a partner? 2. We notice that the Revenue has suggested following additional questions: A. Whether on the facts and circumstances of the case and in law, the ITAT was justified in law in allowing weighted deduction of ₹ 67,620/- u/s. 35(2AB) of the Act to the assessee on accoun tof gifts to R D Employees on occasion of marriage? B. Whether on the facts and circumstances of the case and in law, the ITAT was justified in law in allowing weighted deduction of ₹ 7,91,222/- u/s. 35(2AB) of the Act to the assessee on account of expenses incurred for lunch, refreshment and brokerage paid for property used by R D unit employees after treating the same was expenses incurred for R D activity covered u/s. 35(2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e judgement of Supreme Court in case of Ajanta Pharma Ltd v. Commissioner of Income Tax reported in [2010] 327 ITR 305 rejected such a question. 6. Insofar as question D is concerned, the issue arises out of the assessee's gain on account of conversion of convertible bonds into equity shares. CIT(Appeals) held in favour of the assessee inter alia observing that as per the RBI guidelines, the permissible end-use of such borrowings is investment. For example import of capital goods for implementation of new projects and modernization/expansion of existing production units. The utilization is not permitted for lending or investment in capital market or acquiring another company in India. FCCB is also not permitted for working capital, g ..... X X X X Extracts X X X X X X X X Extracts X X X X
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