Flamingo Pharmaceuticals Ltd. Vs DCIT (ITAT Mumbai)
ITAT Mumbai held that requirement of Form no. 3CL for weighted deduction under section 35(2AB) of the Income Tax Act is effective only from AY 2016-2017. Accordingly, denial of claim for pre-amended period is not justifiable. Thus, appeal is allowed.
Facts- During the assessment proceedings, AO noticed that as the assessee had claimed weighted deducted u/s. 35(2AB) of the Act, in respect of capital expenditure towards Research and Development (R & D) called upon the assessee to furnish approval of the competent authority of the Department of Science and Industrial Research (DSIR) and Ministry of Science and Technology, Government of India. Alleging that the assessee could not furnish approval of the competent authority in the prescribed form and further, it did not furnish the details of loans and fluctuation loss on such loans, the AO disallowed the deduction claimed u/s 35(2AB) of the Act.
CIT(A) held that in the absence of certificate in Form 3CL support of its claim, the claim could not be allowed and therefore, the disallowance of the claim by the AO was sustained. The addition of Rs.1,41,70,730/- and Rs. 81,08,170/- totalling to Rs.2,22,78,900/- was upheld.
Conclusion- Held that similar issue has been adjudicated by the coordinate benches of ITAT in several cases wherein the requirement has been held to be procedural requirement and not a mandatory one.
