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TMI Blog2021 (2) TMI 716X X X X Extracts X X X X X X X X Extracts X X X X ..... he submissions of the assessee filed before the ld. CIT(A). The first item in this list is consumption of stores and spare parts. It has been quantified at ₹ 2,82,703/-. This item cannot be an item from overall list of spares and stores of a company whose returned income is more than ₹ 20.67 crores. Thus, according to the assessee, it has submitted complete details during the assessment proceedings as well as before the ld. CIT(A). But none has bothered to look into. After perusal of the details of expenditure, we are of the view that the ld. CIT(A) has failed to analytically examine the claim of the assessee. He simply proceeded on basis of the list of expenditure submitted before the DSIR. Provision nowhere contemplates tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and notice under section 143(2) was issued and served upon the assessee. A perusal of the record would indicate that the assessee has claimed deduction of ₹ 55.22 lakhs under section 35(2AB) of the Act. The ld. AO has perused this claim and observed that a perusal of the copy of form no. 3CL would indicate that the assessee has incurred an expenditure of ₹ 26.47 lakhs towards revenue and ₹ 0.35 lakhs towards capital expenditure. Since this amount of ₹ 26.47 lakhs was already claimed in the revenue expenditure, therefore, deduction under section 35(2AB) is to be granted at 200%. He accordingly granted deduction at ₹ 26.47 lakhs towards revenue expenditure and ₹ 0.35 lakhs of capital expenditure. Thus, he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant has taken excess claim of ₹ 28,05,000/-, without in depth study of Form 3CL and Form 3CM. Consequently, an addition of ₹ 28,05,000/- has been made by the Ld. AO which is absolutely incorrect. In response to the same, we hereby produce facts and figures related to deduction claimed by the appellant u/s. 35(2AB) of the Act: Details of expenses occurred for R D expenditures (Based on Form 3CL) are produced in the following table: Sr. No. Particulars Amount (In Rs.) A Consumption of stores and spares parts 2,82,703 B Power and fuel 6,6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Q Expenses related to R D already debited to profit loss account (K) 66,69,257 R Expenses to be claimed u/s. 35(2AB) of the act In return of Income(ROI) (P-Q) 59,11,695 S Claimed by the assessee In ROI on actual basis 55,22,020 The above figures are in conformity with the details submitted in Form 3CL and Audited Financial statements for the year under consideration. We hereby produce copy of Form 3CL and Financial Statements for your reference. It is pertinent to note that while making an application in Form 3CK to Department of Scientific Industrial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the tune of ₹ 66,69,257/- was already claimed in the P L Account, deduction of the expenditure of ₹ 59,11,695/- was admissible u/s. 35(2AB). However, the appellant has claimed deduction only to the extent of ₹ 55,22,000/-. On careful consideration of the material placed on record, I find that the appellant has not maintained separate books of account for R D facility and hence, it is not verifiable as to how much expenditure was actually incurred for research and development activity.) Thus, only source of verification available is a certificate issued by DSIR in Form No. 3CL. According to this certificate, the DSIR as certified capital expenditure of ₹ 0.35 lakhs and revenue expenditure of ₹ 26.47 lakhs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he ld. CIT(A) has put reliance on form no. 3CL. To our mind this reasoning is not sustainable because the assessee is a company which has returned income of more than ₹ 20.67 cores. It has given list of expenditure, which we have taken cognizance while extracting the submissions of the assessee filed before the ld. CIT(A). The first item in this list is consumption of stores and spare parts. It has been quantified at ₹ 2,82,703/-. This item cannot be an item from overall list of spares and stores of a company whose returned income is more than ₹ 20.67 crores. Thus, according to the assessee, it has submitted complete details during the assessment proceedings as well as before the ld. CIT(A). But none has bothered to look i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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