Case Law Details
DCIT Vs Aurobindo Pharma Limited (ITAT Hyderabad)
We have considered the rival contentions and perused the case law placed on record. In the decision of Concept Pharmaceuticals Ltd (supra) the Coordinate Bench did not allow the expenditure spent outside the R & D unit but the Bench has not considered the explanation introduced with reference to ‘Clinical Trials’. By very nature, the Clinical Trials cannot alone be done within research facility as they require cooperation from the Medical Doctors, Hospitals, Volunteers and patients, therefore such expenditure has to be necessarily spent outside the facility, but for the purpose of ‘in-house’ research. This issue was examined by the Coordinate Bench which was subject matter of appeal before the Gujarat High Court and Gujarat High Court has approved the same. As seen from the order of the Supreme Court in Special Leave to Appeal (C) No. 770/2015, dated 13.10.2015, the grievance of Revenue with reference to non-framing of three questions were considered by the Hon’ble Supreme Court as those three questions are considered to be ‘substantial question of law’ and referred to the Hon’ble High Court to hear the aforesaid three questions of law. However, the judgment already passed by the Gujarat High Court has not been set-aside. As Ld. CIT(A) has followed the Coordinate Bench decision, which was approved by the Gujarat High Court and as no contrary High Court judgment has been placed on record, we approve the order of the CIT (A) and reject the Revenue contentions.
FULL TEXT OF THE ITAT JUDGMENT
These are Revenue appeals against the common of Ld. CIT(A)- 11, Hyderabad, dated 24.08.2016. The only issue in these appeals is with reference to weighted deduction allowed by Ld. CIT(A) on the clinical trials conducted outside the ‘in-house R & D facility’ which was disallowed by A.O. on the reason that the same was not certified by Prescribed Authority (DSIR) in Form 3CL.
2. Revenue has raised the followed grounds which are common for both the years:-
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