Case Law Details
Allied Engineering Works Pvt Ltd Vs National Faceless Assessment Centre Delhi (Delhi High Court)
Introduction: The case of Allied Engineering Works Pvt. Ltd vs. National Faceless Assessment Centre Delhi, heard by the Delhi High Court, revolves around a penalty imposed on the petitioner concerning an income tax deduction claim for expenditure under Section 35(2AB) of the Income Tax Act. The petitioner sought relief on the grounds of a procedural lapse regarding a fair hearing.
Detailed Analysis:
1. Background: The petitioner challenged a penalty order and a consequential demand notice, both dated 23.06.2023. The penalty was imposed due to an alleged overclaim of deduction for research and development expenses. While the petitioner was allowed a 100% deduction for the relevant assessment year (AY) 2021-22, they claimed a 200% deduction in error.
2. Claim of Mistake: The petitioner contended that the mistake arose due to legislative changes after AY 2017-18, and the cap for deductions had varied between 2018-19 and 2019-20. The petitioner cited other reasons in their defense.
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