Pen Drive Evidence Valid, Cash Receipt Rates Modified, R&D Deductions Under Section 35(2AB) Partially Allowed

ITAT addressed three key issues in this tax appeal. The tribunal upheld the addition of undisclosed income based on electronic evidence from a seized pen drive, as proper certification under Section 65B(4) of Indian Evidence Act was obtained. Regarding unaccounted cash receipts, ITAT modified CIT(A)'s approach of applying 85% blanket rate, directing reassessment based on the assessee's declared net profit rates for respective years. On R&D deductions under Section 35(2AB), the tribunal confirmed that post July 2016, deductions must align with DSIR quantification, except for AY 2016-17 where full revenue expenditure deduction was allowed. The tribunal also upheld CIT(A)'s deletion of Section 69C additions after verifying opening cash balances from seized documents. .....

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