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TMI Blog2020 (3) TMI 345X X X X Extracts X X X X X X X X Extracts X X X X ..... research and invention, the efforts undertaken may or may not yield fruitful results. What is to be ascertained is whether any scientific research was undertaken and not whether such scientific research resulted into the ultimate aim for which such research was undertaken. It can be easily envisaged that the scientific research undertaken often times would completely fail to achieve desired results. That by itself does not mean that no scientific research was undertaken. What the Legislature desired to encourage by granting deduction under section 35(1) of the Act was a scientific research and not necessarily only the successful scientific research undertaken by an assessee. Tribunal committed no error. Merely because the prescribed auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of R D expenditure after excluding export turnover for the purpose of computing allocation of R D expenses and also in not upholding the disallowance of weighted deduction u/s. 35(2AB) on revenue expenditure made by the A.O.? (b) Whether on the facts and in circumstances of the case, the learned ITAT has erred in law and on facts in directing the Assessing Officer to allow the assessee weighted deduction u/s 35(2AB) of clinical trial expenses incurred outside the approved facility? 2 So far as question No.2(a) is concerned, similar question is not admitted by this Court in the assessee's own case in Tax Appeal No.983 of 2018 by observing in paras 5 and 6 of the order dated 4th September 2018 as under: 5. Questions (3) an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ejected. 4 So far as question No.2(b) is concerned, the the same stands answered by this Court in Commissioner of Income-tax I vs. Cadila Healthcare Ltd [2013] 214 taxman 672 (Gujarat). This Court has observed in paras 16, 17 and 18 as under: 16 The whole idea thus appears to be to give encouragement to scientific research. By the very nature of things, clinical trials may not always be possible to be conducted in closed laboratory or in similar inhouse facility provided by the assessee and approved by the prescribed authority. Before a pharmaceutical drug could be put in the market, the regulatory authorities would insist on strict tests and research on all possible aspects, such as possible reactions, effect of the drug and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... certain observations made by the Bench may be of some relevance. 25. It can thus be seen that the term scientific research in the context of the deduction allowable under section 35(1) of the Act would include wide variety of activities. It can also be appreciated that every scientific research need not necessarily result into the ultimate goal with which it may have been undertaken. Often times in the field of research and invention, the efforts undertaken may or may not yield fruitful results. What is to be ascertained is whether any scientific research was undertaken and not whether such scientific research resulted into the ultimate aim for which such research was undertaken. It can be easily envisaged that the scientific researc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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