DCIT Vs Avra Laboratories Pvt. Ltd. (ITAT Hyderabad)
Assessee was engaged in the business of Pharmaceuticals. Assesssee filed return for AY 2018-19 at Rs.86,32,45,870/-. Subsequently, the return was revised by assessee at Rs.85,19,62,570/-. The case was selected for scrutiny for verification of three issues i.e., (i). Deduction on account of donation of Scientific Research (ii) ICDS compliance and adjustment and (iii) Exports/Imports. During the course of assessment proceedings, AO noted that the assessee has claimed deduction u/s 35(2AA) for amounting to Rs.7,50,00,000/- (being 150% of Rs.5,00,00,000/-). AO issued notice u/s142(1) of calling assessee to justify it’s claim with supporting documentary evidences. In response, assessee had furnished copy of ‘Receipt’ dated 12.03.2018 and ‘Letter of Appreciation’ dated 20.03.2018 issued from Indian Institute of Science [in short “IISc], Bangalore to whom the appellant-company had contributed Rs.5 crores by way of cheque for construction of state-of-the-art auditorium. However, AO did not satisfy with the explanation of the assessee and disallowed the deduction u/s.35(2AA) amounting to Rs.7.50 crores and determined the taxable income of the assessee at Rs.92,69,62,570/- vide order passed u/sec.143(3) r.w.s.143(3A) and 143(3B) of IT Act. CIT (A) allowed claim of section 35 (2AA). Hence, the present appeal filed by the revenue.
