DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1, AURANGABAD, AURANGABAD vs. ENDURANCE TECHNOLOGIES LIMITED, AURANGABAD
Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI R. K. PANDA & MS. ASTHA CHANDRA
PER BENCH :
The above batch of 8 appeals filed by the Revenue are directed against the separate orders dated 13.06.2024 and 10.06.2024 of the Ld. CIT(A) / NFAC, Delhi relating to assessment years as mentioned above. For the sake of convenience, all these appeals were heard together and are being disposed of by this common order.
2. Facts of the case, in brief, are that the assessee is a company engaged in the business of manufacturing of automobile parts. It filed its original return of income on 30.09.2011 declaring total income of Rs.22,23,65,379/- after claiming deduction u/s 80IC of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) at Rs.7,82,78,837/-. The return was processed u/s 143(1) of the Act.
Subsequently, the case was selected for scrutiny and statutory notices u/s 143(2) and 142(1) of the Act were issued and served on the assessee in response to which the assessee filed the requisite details. The Assessing Officer completed the assessment u/s 143(3) of the Act on 04.03.2014 assessing the total income at Rs.22,23,65,380/-.
Subsequently, the Assessing Officer reopened the assessment as per the provisions of section 147 of the Act on the ground that the assessee has wrongly claimed the deduction of Rs.3,58,47,391/- u/s 35(2AB) which has escaped assessment. The Assessing Officer thereafter issued notice u/s 148 of the I.T. Act, 1961. 4. The assessee objected to the reasons recorded by the Assessing Officer which were not accepted by him and he passed an order disposing off the objections to notice u/s 148 of the Act on 29.10.2018. Subsequently, the Assessing Officer issued notices u/s 143(2) and 142(1) of the Act asking the assessee to explain the deduction claimed in the return u/s 35(2AB). Rejecting the various explanations given by the assessee, the Assessing Officer made addition of Rs.2,63,91,741/- for want of report in Form 3CL from the prescribed authority by observing as under: “11. The explanation put-forth by the assessee is duly considered in the light of provisions of Income Tax Act. However the same is not tenable. In absence of report in Form No. 3CL from the prescribed authority, it is not ascertainable that what amount was actually incurred towards R&D activities. The assessee during the course of assessment proceedings has not submitted Form No. 3CL, therefore it is construed that the same was not issued to the assessee. Accordingly, the deduction claimed u/s 35(2AB) of the Act of Rs.2,63,91,741/- [Rs.94,55,651 + 1,69,36,090] is disallowed. However expenditure @ 100% of actual expenditure u/s. 35(1)/37(1) of the Act related to revenue expenditure is allowed. Penalty proceedings u/s 271(1)(c) of the Income tax Act, for furnishing of inaccurate particulars of income are initiated separately.”
Before the Ld. CIT(A) / NFAC the assessee, apart from challenging the addition on merit, challenged the validity of assessment on the ground that the erstwhile company High Technology Transmission System India Pvt. Ltd. in whose name the order has been passed, has merged with Endurance Technologies Limited w.e.f. 01.04.2013 pursuant to the order of Hon’ble Bombay High Court dated 10.01.2014. It was submitted that Endurance Technologies Limited had filed a letter dated 20.02.2014 along with the copy of High Court order filed with the