SAVANNAH SEEDS PRIVATE LIMITED,GURGAON vs. DCIT,CIRCLE-22(2), DELHI

(PAN : AAOCS9422M) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri Aakash Uppal, CA REVENUE BY : Shri Anuj Garg, Sr. DR Date of Hearing : 14.12.2023 Date of Order : 19.12.2023 ORDER

PER SHAMIM YAHYA, ACCOUNTANT MEMBER :

taken by the assessee are as under :-

1. On the facts and circumstances of the case, and in law, the Assessment Order passed by National e-Assessment Centre ('NeAC') and National Faceless Appeal Centre ('NF AC') is bad in law.

2. That NeAC and NFAC grossly erred on facts and in law in making disallowance of weighted deduction of expenditure on scientific research amounting to INR 1,94,43,483 under section 35(2AB) of the Act on the basis that the appellant has failed to submit Form 3CL issued by Department of Scientific and Industrial Research ('DSIR'), certifying the amount of expenses incurred by the appellant on research activities.

3. That the NFAC grossly erred in law by upholding the disallowance made by NeAC on account of non-submission of Form 3CL, without appreciating that assessment proceedings were concluded 53 days before time barring date, while Form 3CL was duly issued within such period by DSIR.

4. The NeAC and NF AC failed to appreciate that delay in issue of Form 3CL by DSIR was owing to surge in Covid-19 cases, which further lead to delay on appellant's part to submit Form 3CL to income tax office during the course of assessment proceedings.

5. Without prejudice to the above, the NeAC and NFAC grossly erred on facts and in law in not appreciating that the appellant had itself disallowed an amount of INR 1,29,62,322 in the income-tax return and disallowance of INR 1,94,43,483 amounts to double disallowance to the extent of INR 1,29,62,322.”

“Disallowance of deduction u/s 35(2AB) of the IT Act: On perusal of the records, it is seen that the assessee has claimed expenses(deduction) on in house R&D u/s 35(2AB) of the IT Act amounting to Rs.1,29,62,322/- in the computation of income. Subsequently, the assessee has claimed deduction

Rs. 1 ,94,43,483/-u/s 35(2)AB of the IT Act. The assessee vide reply 04.01.2021 submitted Form3CM, Form 3CK and further stated that the copy of form 3CL is pending with DSIR department and will be uploaded by the end of January 2021. In the interest of natural justice the assessee was allowed the stipulated period as requested however the assessee failed to furnish the same till date. The assessee uploaded form 3CM and Form 3CK however Form 3CL has not been submitted in support of his claim.

4.2 Since the assessee did not furnish the complete appropriate details/documents pertaining to claiming of deduction u/s 35(2AB) of the IT Act, 1961 in spite of giving sufficient time ,the deduction claimed of Rs.1,94,43,483/- (actual expenses i.e 1,29,62,322/-) is hereby disa710w d and added back to the total income of the assessee.”