DCIT., CIRCLE-1(1), HYDERABAD vs. M/S. ARAGEN LIFE SCIENCES LIMITED, HYDERABAD

ITA 639/HYD/2025Status: DisposedITAT Hyderabad25 July 2025AY 2015-16Bench: Shri Vijay Pal Rao, Vice-President A N D Shri Madhusudan Sawdia (Accountant Member)14 pages
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What did the Tribunal hold?

For the Section 80IB deduction (Grounds 1-3), the Tribunal dismissed the Revenue's appeal, upholding the CIT(A)'s order based on consistency with its own earlier decisions in the assessee's case. For the provision for bad and doubtful debts under Section 115JB (Ground 4), the Tribunal noted that a similar issue for Assessment Year 2017-18 was pending and stayed by the Hon'ble High Court. Consequently, this issue was remanded to the Assessing Officer for a decision based on the High Court's final outcome for Assessment Year 2017-18.

What were the facts?

The Revenue appealed against the CIT(A)'s order for Assessment Year 2015-16 regarding two main issues: the assessee's claim for deduction under Section 80IB as an R&D company, and the disallowance of a provision for bad and doubtful debts amounting to Rs. 5,99,74,390/- for computing book profit under Section 115JB. The CIT(A) had allowed both claims in favor of the assessee.

What were the issues?

1. Whether the assessee is eligible for deduction under Section 80IB as an R&D company, considering conditional approval and rule of consistency with past decisions. 2. Whether the provision for bad and doubtful debts should be added back while computing book profit under Section 115JB.

Which sections of the Income-tax Act were involved?

Section 80IB,Section 80IB(8A),Section 115JB,Section 115JA,Section 37(1),Section 36(1)(vii),Section 10,Section 11,Section 12,Section 86,Section 33AC

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, Hyderabad ‘ DB-B ‘ Bench, Hyderabad

Before: Shri Vijay Pal Rao, Vice-Shri Madhusudan Sawdia

Hearing: 22/07/2025

Per Vijay Pal Rao, Vice President

This appeal by the Revenue is directed against the order dated 09/01/2025 of the learned CIT (A)-10 Hyderabad, relating to A.Y.2015-16. 2. The Revenue has raised the following grounds of appeal:

ITA No 639 of 2025 Aragen Life Sciences Ltd

3.

Ground Nos.1 to 3 are regarding the claim of deduction u/s 80IB of the Act was disallowed by the Assessing Officer and allowed by the learned CIT (A). The learned DR has submitted that the approval to the assessee as R&D Company u/s 80IB(8A) by the Central Governm

The order continues below.

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