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| The Tax Publishers2021 TaxPub(DT) 0088 (Mum-Trib) INCOME TAX ACT, 1961
Section 35(2AB)
Expenses incurred for in-house R&D unit of assessee-company were supported by bill and vouchers and duly verified by AO, therefore, weighted deduction under section 35(2AB) could not be disallowed merely on the ground that assessee failed to prove that it had applied for Form 3CM in the year under consideration.
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Business deduction under section 35(2AB) - Weighted deduction of expenditure on R&D - Denial on the ground of failure to apply for Form 3CM - Expenses duly supported by bills and vouchers
Assessee claimed weighted deduction under section 35(2AB). AO disallowed assessee's claims on the ground that assessee failed to prove that it had applied for Form 3CM in the year under consideration. Held: Merely on the ground of technicalities of procedure, benefit bestowed by legislature could not be denied. When it comes to follow the prescribed procedure, exemption provisions have to be liberally construed and if in substance, assessee has fulfilled basic requirements then exemption cannot be denied. In the instant case, expenses incurred for in-house R&D unit of assessee-company were supported by bill and vouchers and duly verified by AO. Therefore, disallowance made by AO could not be upheld.
Followed:Meco Instruments Pvt. Ltd. [2020 TaxPub(DT) 3125 (Mum-Trib)].
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2011-12 to 2013-14
IN THE ITAT, MUMBAI BENCH
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