Section 35(1) of the Income Tax Act

Income-tax Act, 2025: s.45

Section 35(1) falls under section 35 of the Income-tax Act, 1961, which corresponds to section 45 (Expenditure on scientific research) of the Income-tax Act, 2025.

Read section 45 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 35(1) is M/s Seksaria Biswan Sugar Factory Ltd. and Another v. Inspecting Assistant Commissioner and Others (184 ITR 123), cited in 20 of the 69 judgments on BharatTax that turn on this section.

Leading authorities on Section 35(1)

M/s Seksaria Biswan Sugar Factory Ltd. and Another v. Inspecting Assistant Commissioner and Others
184 ITR 123 · 1990 · High Court
20
citing judgments

The withdrawal of approval for a deduction, such as under Section 35CCA, cannot be given retrospective effect, and any reassessment notice based on such a retrospective cancellation is invalid. An assessee should not suffer due to the department's mistakes, and withdrawal of approval can only be prospective.

CIT v. Bhartia Culter Hammer Co.
232 ITR 785 · 1998 · High Court
20
citing judgments

An assessee should not suffer due to the department's mistake. If a donation to an approved society is genuine, retrospective withdrawal of approval does not affect the assessee's right to deduction. Withdrawal of approval can only be prospective.

CIT v. M/s. Schmetz India Pvt. Ltd.
211 Taxmann 59 · 2012 · High Court
16
citing judgments
CIT v. Digital Global Soft Ltd.
354 ITR 489 · 2013 · High Court
16
citing judgments

The Commissioner of Income Tax can only exercise revisionary powers under Section 263 if an order passed by the Assessing Officer is both erroneous and prejudicial to the interests of the revenue. The Commissioner cannot invoke revisionary powers solely on the ground that an order is erroneous.

Sun Pharmaceuticals Industries Ltd. v. Pr.CIT
77 Taxmann.com 202 · 2017 · Reported
15
citing judgments
184 ITR 123, CIT v. Bhartia Cutler Hammer Co.
236 ITR 644 · 1999 · Reported
11
citing judgments

An assessee should not suffer due to a mistake by the department. Withdrawal of approval for a society, even if permissible, must have prospective effect and cannot disentitle an assessee to a deduction for genuine donations made prior to withdrawal.

Commissioner of Income Tax v. General Magnets Ltd.
256 ITR 471 · 2002 · High Court
11
citing judgments

When approval for a deduction is withdrawn with retrospective effect, the order of the assessing officer cannot be considered erroneous or prejudicial to the interests of the revenue, as the assessee should not suffer for a mistake made by the department. There is no provision for withdrawal of recognition under Section 35(1)(ii) of the Act.

Madras in CIT v. Celebrity Fashion Ltd.
119 Taxmann.com 426 · 2020 · High Court
10
citing judgments

A disallowance under section 14A is bad in law without a finding that expenditure has a relation to exempt income and without recording satisfaction.

PCIT v. Harpreet Kaur
88 Taxmann.com 641 · 2017 · High Court
8
citing judgments
Kearney India (P.) Ltd. v. Addl. CIT (
141 ITD 456 · ITAT
7
citing judgments

Judgments on Section 35(1)

Tayo Rolls Ltd, Jamshedpur vs. ACIT Cir-3, Jamshedpur

In the result, all the appeals of the assessee are partly allowed

ITA 244/RAN/2017[07-08]Status: DisposedITAT Ranchi05 Apr 2019

Bench: Shri S.S. Godara, Jm &Dr. A.L.Saini, Am आयकरअपीलसं./Ita Nos.244 & 245/Ran/2017 ("नधा"रणवष" / Assessment Years: 2007-08 To 2008-09)

For Appellant: Shri P.R. Mittal, AdvocateFor Respondent: Shri P.K. Mondal, JCIT
Section 143(3)Section 43(4)

M/S. Indraprastha Cancer Society & Research Centre, New Delhi vs. Addl. DIT (Exemption), New Delhi

In the result, whereas appeal of the revenue is partly allowed, appeal of the assessee is allowed for statistical purposes

ITA 2816/DEL/2013[2006-07]Status: DisposedITAT Delhi28 Mar 2019AY 2006-07

Bench: Shri N.K. Billaiya & Shri K.Narasimha Charyassessment Year: 2006-07 Income-Tax Officer (E), Vs M/S Indraprashta Cancer Society Trust Ward-Iv, New Delhi. & Research Centre, Q-5A, Jangpura Extension, New Delhi. Pan: Aaati0440C Assessment Year: 2006-07

Section 10Section 11Section 12ASection 143(3)Section 2(15)Section 35(1)

ITO (E), New Delhi vs. M/S. Indraprastha Cancer Society and Research Centre, New Delhi

In the result, whereas appeal of the revenue is partly allowed, appeal of the assessee is allowed for statistical purposes

ITA 2607/DEL/2013[2006-07]Status: DisposedITAT Delhi28 Mar 2019AY 2006-07

Bench: Shri N.K. Billaiya & Shri K.Narasimha Charyassessment Year: 2006-07 Income-Tax Officer (E), Vs M/S Indraprashta Cancer Society Trust Ward-Iv, New Delhi. & Research Centre, Q-5A, Jangpura Extension, New Delhi. Pan: Aaati0440C Assessment Year: 2006-07

Section 10Section 11Section 12ASection 143(3)Section 2(15)Section 35(1)

Shri Santnath Sahakari Sakhar Karkhana Ltd, Solapur vs. Assistant Commissioner of Income Tax

In the result, the appeal of assessee is dismissed

ITA 2990/PUN/2016[2009-10]Status: DisposedITAT Pune18 Oct 2018AY 2009-10

Bench: Shri D. Karunakara Rao, Am & Shri Vikas Awasthy, Jm

For Appellant: N O N EFor Respondent: Shri Rajesh Gawli
Section 35(1)Section 35(1)(ii)

Pha India Pvt. Ltd., Sriperumbudur vs. DCIT Corporate Circle 5(2), Chennai

In the result appeal of the assessee is allowed for statistical purposes as indicated herein above

ITA 2452/CHNY/2017[2014-15]Status: DisposedITAT Chennai19 Jul 2018AY 2014-15

Bench: Shri N.R.S. Ganesan & Shri A.Mohan Alankamonyआयकर अपील सं./I.T.A.No.2452/Chny/2017 (िनधा"रण वष" / Assessment Year: 2014-15) M/S. Pha India Pvt. Ltd., Vs The Dcit, Corporate Circle – 5(2), No.C-16 & C-25, Sipcot Industrial Chennai - 34. Park, Irungattukottai, Sriperumbudur, Tamilnadu – 602 117. Pan:Aaacp6585A (अपीलाथ"/Appellant) (""यथ"/Respondent)

Section 143(2)Section 143(3)Section 145ASection 250(6)Section 32Section 35Section 35(1)

Ra Chem Pharma Limited, Hyderabad vs. ITO, Ward-3(2), Hyderabad

In the result, assessee’s appeal in ITA No

ITA 65/HYD/2017[2012-13]Status: DisposedITAT Hyderabad08 Jun 2018AY 2012-13

Bench: Smt. P. Madhavi Devi & Shri S. Rifaur Rahmanassessment Year: 2012-13

For Appellant: Shri S. Rama RaoFor Respondent: Shri R. Mohan Reddy
Section 143(3)

DCIT, Circle-3(1), Hyderabad vs. Ra Chem Pharma Limited, Hyderabad

In the result, assessee’s appeal in ITA No

ITA 49/HYD/2017[2012-13]Status: DisposedITAT Hyderabad08 Jun 2018AY 2012-13

Bench: Smt. P. Madhavi Devi & Shri S. Rifaur Rahmanassessment Year: 2012-13

For Appellant: Shri S. Rama RaoFor Respondent: Shri R. Mohan Reddy
Section 143(3)

DCIT, Circle-3(1), Hyderabad vs. Ra Chem Pharma Limited, Hyderabad

In the result, assessee’s appeal in ITA No

ITA 48/HYD/2017[2010-11]Status: DisposedITAT Hyderabad08 Jun 2018AY 2010-11

Bench: Smt. P. Madhavi Devi & Shri S. Rifaur Rahmanassessment Year: 2012-13

For Appellant: Shri S. Rama RaoFor Respondent: Shri R. Mohan Reddy
Section 143(3)

Cummins India Ltd vs. Deputy Commissioner of Income-Tax

In the result, appeal of assessee is partly allowed

ITA 309/PUN/2014[2009-10]Status: DisposedITAT Pune15 May 2018AY 2009-10

Bench: Ms. Sushma Chowla, Jm & Shri Anil Chaturvedi, Am आयकर अपीऱ सं. / Ita No.309/Pun/2014 यििाारण वषा / Assessment Year : 2009-10 Cummins India Limited, अऩीऱाथी/Appellant Kothrud, Pune – 411038 …. Pan: Aaacc7258B Vs. The Dy. Commissioner Of Income-Tax, …. प्रत्यथी / Respondent Circle 1(1), Pune

For Appellant: S/Shri Arvind SondeFor Respondent: Ms. Nirupama Kotru
Section 143(3)Section 92C

DCIT, Circle-16(2), Hyd, Hyderabad vs. Mylan Laboratories Ltd., Hyd, Hyderabad

In the result, appeal of Revenue is partly allowed

ITA 659/HYD/2016[2010-11]Status: DisposedITAT Hyderabad09 May 2018AY 2010-11

Bench: Smt. P. Madhavi Devi & Shri B. Ramakotaiah

For Appellant: Shri K.A. Sai Prasad, ARFor Respondent: Smt. T.H. Vijaya Lakshmi, CIT-DR
Section 10BSection 115JSection 143(3)Section 144CSection 14ASection 92ASection 92C

Mylan Laboratories Ltd, (Formerly Matrix Laboratories Limited), Hyd Hyd, Hyderabad vs. DCIT, Circle-16(2), Hyd, Hyderabad

In the result, appeal of Revenue is partly allowed

ITA 626/HYD/2016[2010-11]Status: DisposedITAT Hyderabad09 May 2018AY 2010-11

Bench: Smt. P. Madhavi Devi & Shri B. Ramakotaiah

For Appellant: Shri K.A. Sai Prasad, ARFor Respondent: Smt. T.H. Vijaya Lakshmi, CIT-DR
Section 10BSection 115JSection 143(3)Section 144CSection 14ASection 92ASection 92C

Principal Commissioner of Income Tax - 6 vs. Investment and Precision Casting Ltd

Appeals are dismissed

TAXAP/169/2018HC Gujarat23 Apr 2018
Section 35Section 35(1)Section 35(1)(iv)Section 35(3)

ACIT 21(1), Mumbai vs. Jaydev Chemical Industries, Mumbai

Appeal stands partly allowed for statistical purposes

ITA 3932/MUM/2016[2011-12]Status: DisposedITAT Mumbai28 Feb 2018AY 2011-12

Bench: Shri Mahavir Singh, Jm & Shri Manoj Kumar Aggarwal, Am आयकर अपील सं./I.T.A. No. 3932/Mum/2016 (िनधा"रण वष" / Assessment Year: 2011-12) Jaydev Chemical Industries Assistant Commissioner Of 401, Om Building, 118 Income-Tax 21(1) बनाम/ R.No.116, 1St Floor Dr.M.B.Raut Road Vs. Shivaji Park, Dadar Piramal Chamber, Parel Mumbai-400 028 Mumbai – 400 012 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aacfj-1584-C (अपीलाथ" /Appellant) (""थ" / Respondent) :

For Appellant: Vinay D. Mulye, Ld. ARFor Respondent: M.C.Omi Ningshen, Ld. DR
Section 133(6)Section 143(3)Section 35(1)Section 35(1)(iv)Section 35(2)(ia)

Nivo Controls P. Ltd, Mumbai vs. CIT 1, Mumbai

In the result, the appeal filed by the assessee is partly allowed, for statistical purpose

ITA 3533/MUM/2014[2009-10]Status: DisposedITAT Mumbai31 Jan 2018AY 2009-10

Bench: Shri D.T. Garasia () & Shri G Manjunatha ()

Section 143(3)Section 263Section 35Section 35(1)

DCIT, Chennai vs. Hsi Automotive Limited, Kancheepuram

In the result, the appeal filed by the Revenue is partly allowed for statistical purposes

ITA 1123/CHNY/2017[2010-11]Status: DisposedITAT Chennai27 Oct 2017AY 2010-11

Bench: Shri Chandra Poojari & Shri Duvvuru Rl Reddyआयकर अपील सं./I T.A. No.1123/Mds/2017 "नधा"रण वष"/Assessment Year:2010-11 The Deputy Commissioner Of M/S. Hsi Automotive Limited, Income Tax, Corporate Circle 2(2), Vs. Survey No. 73, ‘A’ Block, 100, Room No. 512, 5Th Floor, Thandalam (Po), Mevalurkuppam, Wanaparthy Block, 121, M.G. Road, Sriperumbudur, Chennai 600 034. Kancheepuram, 602 105. [Pan:Aaach2804E] (अपीलाथ" /Appellant) (""यथ"/Respondent) अपीलाथ" क" ओर से / Appellant By : Shri K. Ravi, Jcit ""यथ" क" ओर से/Respondent By : Shri H. Chandrasekaran, C.A. सुनवाई क" तार"ख/ Date Of Hearing : 27.09.2017 घोषणा क" तार"ख /Date Of Pronouncement : 27.10.2017 आदेश /O R D E R Per Duvvuru Rl Reddy: This Appeal Filed By The Revenue Is Directed Against The Order Of The Ld. Commissioner Of Income Tax (Appeals) 6, Chennai Dated 27.02.2017 Relevant To The Assessment Year 2010-11. The Revenue Has Raised Three Grounds In Its Appeal Viz., (I) The Ld. Cit(A) Has Erred In Deleting The Disallowance Made On Account Of Scientific Expenses Claimed Under Section 35(1) Of The Income Tax Act, 1961 [“Act” In Short], (Ii) The Ld. Cit(A) Has Erred In Excluding The Investments Made By The Assessee In Its Subsidiary

For Appellant: Shri K. Ravi, JCITFor Respondent: Shri H. Chandrasekaran, C.A
Section 143(1)Section 143(2)Section 143(3)Section 35(1)

VI Micro Systems P Ltd., Chennai vs. ACIT, Chennai

In the result, the assessee appeals are partly allowed

ITA 1173/CHNY/2017[2013-14]Status: DisposedITAT Chennai29 Aug 2017AY 2013-14

Bench: Shri Sanjay Arora & Shri Duvvuru Rl Reddyआयकर अपील सं./Ita No.1172/Mds/2017 "नधा"रण वष" / Assessment Year : 2012-13

For Appellant: Shri Ashish Tripathi, Jt. CITFor Respondent: 26.07.2017
Section 143(3)Section 35Section 35(1)

VI Micro Systems P Ltd., Chennai vs. ACIT, Chennai

In the result, the assessee appeals are partly allowed

ITA 1172/CHNY/2017[2012-13]Status: DisposedITAT Chennai29 Aug 2017AY 2012-13

Bench: Shri Sanjay Arora & Shri Duvvuru Rl Reddyआयकर अपील सं./Ita No.1172/Mds/2017 "नधा"रण वष" / Assessment Year : 2012-13

For Appellant: Shri Ashish Tripathi, Jt. CITFor Respondent: 26.07.2017
Section 143(3)Section 35Section 35(1)

DCIT 2(2), Mumbai vs. Tractor Engineers Ltd, Mumbai

In the result, both the appeals filed by the revenue are allowed for statistical purpose

ITA 1048/MUM/2014[2009-10]Status: DisposedITAT Mumbai25 Oct 2016AY 2009-10

Bench: Shri Rajendra & Shri C.N. Prasadआयकर अपील सं /I.Ta Nos. 1048 & 5438/Mum/2014 ("नधा"रण वष" / Assessment Years: 2009-10 & 2010-11 The Acit-2(2), M/S. Tractor Engineers Ltd., बनाम/ Aayakar Bhavan, Now L&T Cutting Tools Ltd., Vs. Mumbai-400 020 L&T House, N.M. Marg, Ballard Estate, Mumbai- 400 001 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aaact 4499B .. (अपीलाथ" /Appellant) (""यथ" / Respondent) अपीलाथ" ओर से/ Department By: Shri Sanjeev Kashyap Ms. Usha Gopalan ""यथ" क" ओर से/Assessee By:

For Respondent: Shri Sanjeev Kashyap
Section 143(3)Section 35(1)

Mahindra Navistar Automotives Ltd, Pune vs. DCIT 2(2)

In the result, the assessee’s appeals are partly allowed for statistical purposes

ITA 3324/MUM/2013[2007-08]Status: DisposedITAT Mumbai13 May 2016AY 2007-08

Bench: Shri Joginder Singh, Jm & Shri Sanjay Arora, Am आयकर अपील सं./I.T.A. Nos. 3324 & 4645/Mum/2013 ("नधा"रण वष" / Assessment Years: 2007-08 & 2008-09) Mahindra Navistar Automotives Dy. Cit, 2(2), Limited, Mumbai बनाम/ 128 A, Sanghavi Compound, Off. Mumbai Pune Highway, Vs. Opp. Jayashree Cinema, Chinchwad, Pune-411 019 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aaacm 7863 L (अपीलाथ" /Appellant) (""यथ" / Respondent) : अपीलाथ" क" ओर से / Appellant By : Shri H. P. Mahajani ""यथ" क" ओर से/Respondent By : Shri N. P. Singh सुनवाई क" तार"ख / : 17.02.2016 Date Of Hearing घोषणा क" तार"ख / : 13.05.2016 Date Of Pronouncement आदेश / O R D E R Per Sanjay Arora, A. M.: These Are A Set Of Two Appeals By The Assessee Agitating Its Assessments, I.E., As Modified By The First Appellate Authority, For Two Consecutive Years Being Assessment Under The Income Tax Act, 1961 (‘The Act’ Hereinafter) For The Assessment Years (A.Ys.) 2007-08 & 2008-09. The Appeals Raising Common Issues Were Listed For & Are Accordingly Heard Together & Are Being Disposed Of, By The Common, Consolidated Order.

For Appellant: Shri H. P. MahajaniFor Respondent: Shri N. P. Singh
Section 32(1)(i)Section 32(1)(ii)Section 35(1)Section 37(1)Section 40

M/S. Continental Device India Ltd., New Delhi vs. Addl. CIT, New Delhi

In the result, all the appeals are partly allowed

ITA 316/DEL/2013[2009-10]Status: DisposedITAT Delhi16 Oct 2015AY 2009-10

Bench: Shri N.K. Saini & Shri A.T. Varkey

For Appellant: Shri Pardeep Dinodia & R.K. Kapoor, CAsFor Respondent: Smt. Parwinder Kaur, Senior DR
Section 143(1)Section 143(2)Section 35(1)Section 43(1)