CHAROEN POKPHAND SEEDS INDIA PRIVATE LIMITED,BENGALURU V. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-2(1), BENGALURU

ITA 432/BANG/2025

AI Insights

The case revolves around the denial of a weighted deduction claimed by Charoen Pokphand Seeds India Pvt. Ltd. under section 35(2AB) of the Income Tax Act, 1961, for expenditures on its in-house R&D facilities. The Assessing Officer initially denied the deduction on the grounds that the approval from the Department of Scientific and Industrial Research (DSIR) was not valid for the assessment year in question. The CIT(A) upheld this decision, leading the assessee to appeal before the Income Tax Appellate Tribunal. The Tribunal, after considering various judicial precedents and the specific circumstances of the case, ruled in favor of the assessee, emphasizing the beneficial nature of the provision and the procedural delays not being attributable to the assessee.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 840623 (ITAT-BANGALORE)
• Duration Of Justice: 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-02-2026
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 28-02-2025
• Other Referred Cases: Goetze (India) Ltd. v. CIT, Tejas Networks Ltd. v. DCIT, Apollo Tyres Ltd. v. ACIT, Maruti Suzuki India Ltd. v. Union of India, TVS Electronics Ltd. v. ACIT, Banco Products (India) Pvt. Ltd. v. DCIT, Claris Lifesciences Ltd. v. CIT, Sadan Vikas (India) Ltd. v. CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: BALUSAMY N
• Assessee Lawyers: ANKUR PAI
• Keywords: Revised return; Competent authority
• Section: 234B

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH, BANGALORE BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI KESHAV DUBEY, JUDICIAL MEMBER ITA No. 432/Bang/2025 Assessment Year: 2013-14 Charoen Pokphand Seeds India Pvt. Ltd., No.12/1, 4th Floor, New Thippasandra Main Road, New Thippasandra, HAL III Stage, Bengaluru – 560 075. PAN – AACCC3259 N Vs. The Dy. Commissioner of Income Tax, Circle – 2(1)(1), Bengaluru. APPELLANT RESPONDENT Assessee by : Shri Ankur Pai, Advocate Revenue by : Shri Balusamy N, JCIT Date of hearing : 02.02.2026 Date of Pronouncement : 25.02.2026 O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: The present appeal has been instituted by the assessee against the order of the Ld. CIT(A) passed u/s 250 of the Act dated 02.02.2025 2. The assessee in the memo of appeal raised multiple grounds including sub-grounds, which we, for the sake of brevity and convenience are not inclined to reproduce here. Printed from counselvise.com ITA No.432/Bang/2025 Page 2 of 17 . 3. At the outset, we note that the ground No. 1 is general in nature and does not call for separate and independent adjudication. Therefore, we dismiss the same as infructuous. 4. Ground No. 2 to Ground No. 5 are interconnected and pertains to allowability of deduction u/s 35(2AB) of the Act. 5. The brief facts of the case are that the assessee, a private limited company, is engaged in the agro-based manufacturing industry i.e. carrying on the business of processing agricultural seeds. The assessee has established in-house Research and Development centres at four locations, which are duly recognized by the Department of Scientific and Industrial Research (DSIR). For the assessment year under consideration, the assessee filed its return of income declaring a total income of Rs. 3,41,57,800/- only. In the said return, the assessee claimed deduction of Rs. 3,10,42,992 under section 35(2AB) of the Act, 1961, in respect of expenditure incurred on its approved in-house R&D facilities. The assessee to justify its claim filed the necessary particulars, including copies of Form 3CK filed before the Department of Scientific and Industrial Research (DSIR) and the approval granted by the DSIR in respect of its in-house Research and Development facilities. The assessee submitted that its R&D centres were duly recognized and approved by the prescribed authority and, therefore, the deduction claimed under section 35(2AB) of the Act was in accordance with law. 5.1 However, upon examination of the approval granted by the Department of Scientific and Industrial Research, the Assessing Officer observed that the approval issued in Form 3CM specifically mentioned that the recognition of the in-house R&D facility, for the purpose of claiming deduction under section 35(2AB) of the Act, was valid for the period from 01.04.2013 to 31.03.2017. The Assessing Officer noted that Printed from counselvise.com ITA No.432/Bang/2025 Page 3 of 17 . the period of approval commenced from 1st April 2013 and, therefore, according to him, the approval did not cover the previous year relevant to the assessment year under consideration. On this basis, the Assessing Officer formed a prima facie view that the assessee was not entitled to the deduction claimed for the year under appeal. Hence, an explanation was sought by the AO from the assessee. 5.2 In response to the show cause notice issued by the Assessing Officer, the assessee, vide its reply dated 28.12.2015, submitted that it had subsequently filed Form 3CL before the Department of Scientific and Industrial Research requesting that the deduction under section 35(2AB) be allowed with effect from 01.04.2012. The assessee submitted that the matter was pending before the DSIR and that the reply from the prescribed authority was awaited. It was contended that the delay or pendency on the part of the DSIR should not prejudice the assessee’s legitimate claim. In support of its contention, the assessee placed reliance on certain judicial precedents wherein it was held that once the in-house R&D facility is approved, the deduction cannot be denied merely on account of procedural delays or technical issues relating to certification. 5.3 However, the Assessing Officer was not convinced with the explanation furnished by the assessee. He observed that the approval granted by the DSIR in Form 3CM was valid only from the specified date and that no approval covering the year under consideration was produced before him. The Assessing Officer held that in the absence of a valid approval for the relevant period, the assessee was not entitled to claim deduction under section 35(2AB) of the Act. Accordingly, he rejected the contention of the assessee and disallowed the deduction of Printed from counselvise.com ITA No.432/Bang/2025 Page 4 of 17 . Rs. 3,10,42,991/- claimed under section 35(2AB) of the Act and added the said amount to the total income of the assessee. 6. Aggrieved by the assessment order, the assessee preferred an appeal before the Ld. CIT(A). 7. Before the Ld. CIT(A), the assessee reiterated the submissions made before the Assessing Officer. It was contended that the in-house R&D facilities were duly recognized by the DSIR and that the deduction under section 35(2AB) could not be denied merely on account of the period mentioned in the approval or the pendency of Form 3CL. The assessee again submitted that it had approached the DSIR for appropriate clarification and certification and that the delay on the part of the prescribed authority should not prejudice its statutory claim. Reliance was once again placed on judicial precedents in support of the contention that once the facility is approved, the deduction ought to be allowed subject to verification of the expenditure. 7.1 The Ld. CIT(A) observed that the approval granted by the Department of Scientific and Industrial Research (DSIR) in Form 3CM was valid only for the period from 01.04.2013 to 31.03.2017. The assessment year under consideration did not fall within the effective period of approval, and therefore the assessee was not in possession of a valid approval for claiming weighted deduction under section 35(2AB) of the Act for the relevant year. It was held that the assessee had not produced any valid Form 3CM or Form 3CL covering the relevant period and, therefore, the claim was unsupported. 7.2 The Ld. CIT(A) further observed that the assessee had filed the application for Form 3CM after filing the return of income and that no revised return had been filed after obtaining approval. Relying on the decision of the Hon’ble Supreme Court in Goetze (India) Ltd. v. CIT (284 Printed from counselvise.com ITA No.432/Bang/2025 Page 5 of 17 . ITR 323), wherein it was held that a fresh claim for deduction cannot be entertained otherwise than by filing a revised return. On this reasoning as well, the Ld. CIT(A) concluded that the claim of the assessee itself was ab initio void. 7.3 The Ld. CIT(A) also referred to the provisions of section 35(3) of the Act and observed that the question as to whether any activity constitutes scientific research and to what extent the expenditure qualifies is to be decided by the prescribed authority, namely DSIR. It was noted that Form 3CL is required to be issued by the prescribed authority and that routine activities do not qualify as scientific research in terms of Rule 6(7A)(b) of income tax Rules. It was therefore held that without valid certification in Form 3CL or approval in Form 3CM for the relevant period, the claim could not be allowed. 7.4 Reliance was also placed on the decision of the Hon’ble Karnataka High Court in Tejas Networks Ltd. v. DCIT (60 taxmann.com 309) to emphasize that the Assessing Officer cannot sit in judgment over the certification issued by the prescribed authority and that matters relating to the correctness of certification must be referred in accordance with section 35(3) of the Act. However, in the present case, the Ld. CIT(A) held that there was no valid certification covering the year under consideration and therefore the benefit could not be granted. 7.5 The Ld. CIT(A) further observed that accepting the assessee’s contention would render the statutory requirement of approval under section 35 of the Act otiose and would permit the assessee to claim deduction without intervention of the prescribed authority. It was held that relaxation of procedural requirements, if any, falls within the ambit of section 119(2)(c) of the Act and is within the prerogative of the Printed from counselvise.com ITA No.432/Bang/2025 Page 6 of 17 . Central Government and Parliament, and not within the jurisdiction of the appellate authority. 7.6 The Ld. CIT(A) also placed reliance on the decision of the Hon’ble Kerala High Court in Apollo Tyres Ltd. v. ACIT (284 Taxman 687), wherein it was held that approval and agreement with DSIR are conditions precedent for claiming weighted deduction under section 35(2AB) of the Act. Respectfully following the said decision, the Ld. CIT(A) concluded that the assessee was not entitled to the deduction and that the claim was not maintainable. 8. Aggrieved by the order of the Ld. CIT(A), assessee preferred an appeal before us. 9. The Ld. AR before us submitted a paper book running from page No. 01 to 145, which contains the written submissions filed before the lower authorities, copies of the assessment order and the order of the Ld. CIT(A), along with a compilation of judicial precedents relied upon in support of the claim under section 35(2AB) of the Act. The Ld. AR drew our attention to the relevant pages of the paper book while advancing arguments and reiterated that the deduction was duly claimed in accordance with law. 9.1 The Ld. AR submitted that section 35(2AB) is a beneficial provision meant to encourage companies to set up in-house Research and Development facilities in India. The assessee has established such R&D units, and these units have been duly recognized by the Department of Scientific and Industrial Research (DSIR) since 01.04.2007. The recognition was renewed from 01.04.2012 to 31.03.2015. Therefore, for the year under consideration, the R&D units were validly recognized. Printed from counselvise.com ITA No.432/Bang/2025 Page 7 of 17 . 9.2 It was submitted that the assessee filed Form 3CK online on 31.10.2013 seeking approval for weighted deduction at 200% under section 35(2AB) for AY 2013-14 to 2015-16. This was filed before the return of income was filed on 27.11.2013. Due to technical issues and discontinuation of online procedures by DSIR, the assessee filed a manual application in Form 3CK on 26.12.2013. The DSIR considered the manual application and subsequently granted approval in Form 3CM for the period 01.04.2013 to 31.03.2017. 9.3 The Ld. AR submitted that merely because the approval mentions the period from 01.04.2013, the deduction for AY 2013-14 cannot be denied. The R&D units were already recognized earlier, and the application for approval had been made within time. The delay in granting approval was on the part of the DSIR and not attributable to the assessee. The assessee cannot be penalized for administrative delay. Reliance was placed on several High Court decisions. In Claris Lifesciences Ltd. (Gujarat High Court) in (2010) 326 ITR 251 (Gujarat), it was held that once the facility is approved, the entire expenditure incurred for development of the R&D facility is eligible for weighted deduction and the date mentioned in the approval letter cannot restrict the claim. Similar view was taken by the Hon’ble Delhi High Court in Sadan Vikas (India) Ltd. in (2011) 335 ITR 117 (Delhi), where deduction was allowed even though approval was granted later. 9.4 Further reliance was placed on Maruti Suzuki India Ltd. (Delhi High Court) in (2017) 397 ITR 728 (Delhi), where it was held that what is relevant is the existence of recognition of the R&D facility and not the specific date mentioned in the approval certificate. Since the assessee had valid recognition from 01.04.2012, the deduction for AY 2013-14 should be allowed. Printed from counselvise.com ITA No.432/Bang/2025 Page 8 of 17 . 9.5 The Ld. AR also relied on the decision of the Madras High Court in TVS Electronics Ltd. in (2019) 419 ITR 187 (Madras) wherein it was held that an assessee cannot be denied deduction due to bureaucratic delay in granting approval. Similarly, in Banco Products (India) Pvt. Ltd. (Gujarat High Court) in (2017) 397 ITR 728 (Delhi), it was held that deduction cannot be denied merely because approval was granted in a subsequent year. 9.6 It was submitted that the DSIR has neither rejected nor expressly denied approval for AY 2013-14. The approval letter is silent regarding that year. Since approval has been granted for AYs 2014-15 and 2015- 16 under the same application, and the R&D facilities satisfy all conditions, approval for AY 2013-14 should be treated as deemed to have been granted. 9.7 The Ld. AR distinguished the case of Tejas Networks Ltd. (Supra) relied upon by the Ld. CIT(A), stating that in that case the issue was about extent of eligible expenditure and reference under section 35(3) of the Act, whereas in the present case the issue is about the effective date of approval. 9.8 Similarly, the reliance placed on Apollo Tyres Ltd. (Kerala High Court) (Supra) by the ld. CIT-A was stated to be misplaced. In that case, the agreement with DSIR was entered into much later, whereas in the present case, Form 3CK was filed before the due date of filing the return and the delay was procedural in nature. 9.9 It was further submitted that for AY 2014-15, the Assessing Officer has accepted the deduction claimed under section 35(2AB) of the Act, which shows that the R&D facility fulfils all required conditions. 10. On the Contrary, the learned Departmental Representative supported the orders of the lower authorities and submitted that Printed from counselvise.com ITA No.432/Bang/2025 Page 9 of 17 . deduction under section 35(2AB) of the Act can be allowed only if there is a valid approval from the prescribed authority covering the relevant period. In the present case, the approval granted by DSIR in Form 3CM clearly mentions validity from 01.04.2013 to 31.03.2017. Since the assessment year under consideration relates to the previous year 2012- 13, there was no valid approval covering that year. Therefore, the assessee was not eligible for weighted deduction. 10.1 The Ld. DR further submitted that the statutory requirement of approval cannot be treated as a mere procedural formality. Without valid certification in Form 3CM or Form 3CL for the relevant year, the claim cannot be allowed. Reliance was placed on judicial precedents such as Tejas Networks Ltd. v. DCIT, Apollo Tyres Ltd. v. ACIT, and decisions of the Tribunal rendered after the amendment to section 35(2AB) of the Act, to contend that approval and certification by DSIR are mandatory conditions. It was argued that accepting the assessee’s contention would render the statutory requirement of approval meaningless. Accordingly, the order of the CIT(A) disallowing the deduction was justified and should be upheld. 11. The Ld. AR has also submitted a rejoinder before us dated 20.06.2025. The Ld. AR submitted that the decisions relied upon by the Ld. DR are not applicable to the present case since they pertain to assessment years governed by the amended provisions of section 35(2AB) of the Act and Rule 6 of the Income-tax Rules, 1962, as substituted by the Finance Act, 2016 with effect from 01.07.2016. 11.1 It was submitted that prior to the amendment, including the relevant AY 2013-14, there was no statutory requirement that the quantum of expenditure eligible for deduction under section 35(2AB) must be approved or quantified by the DSIR in Form 3CL. The Printed from counselvise.com ITA No.432/Bang/2025 Page 10 of 17 . amendment introduced a material change whereby the prescribed authority was required to quantify eligible expenditure, and such quantification became mandatory for allowing deduction. Therefore, case laws interpreting post-amendment provisions cannot be applied to earlier years. 11.2 With regard to the decision of the Ahmedabad ITAT in Gujarat Metal Cast Industries P. Ltd. (2025) reported in 173 taxmann.com 144, it was submitted that the said decision pertains to AY 2018-19 and clearly proceeds on the basis of amended provisions where filing of Form 3CL and reduced rate of weighted deduction were mandatory. Hence, the said decision is not relevant for AY 2013-14. 11.3 The Ld. AR relied on the decision of the Kolkata ITAT in DCIT v. STP Ltd. (ITA No. 1761/Kol/2019), which also pertains to AY 2013-14. In that case, it was held that prior to 01.07.2016 there was no legal sanctity attached to Form 3CL for the purpose of allowing deduction under section 35(2AB) of the Act, and once recognition of the facility was granted and agreement executed, the role of the Assessing Officer was limited to examining the expenditure incurred on the approved in- house R&D facility. 11.4 As regards the decision of the Pune ITAT in Garware Technical Fibres Ltd. (2025) reported in 171 taxmann.com 302, it was submitted that the issue there was related to quantification of deduction for AY 2016-17 and subsequent years and was considered in the light of amended provisions. In fact, for AY 2016-17, the Tribunal held that DSIR quantification was not mandatory. Therefore, the said decision does not support the Revenue’s case and rather supports the Appellant’s contention for earlier years. Printed from counselvise.com ITA No.432/Bang/2025 Page 11 of 17 . 11.5 In respect of Mahle Behr India (P.) Ltd. (2025) reported in 171 taxmann.com 96, it was submitted that the issue in that case pertained to expenditure incurred outside the approved facility and outside India. There is no such dispute in the present case, as all expenditure was incurred in India and within the approved R&D facility. Hence, the said decision is factually distinguishable. 11.6 The Ld. AR reiterated reliance on the following Hon’ble High Court decisions which squarely apply to the present facts: • Banco Products (India) Pvt. Ltd. (Gujarat High Court) in (2018) 405 ITR 318 (Gujarat) • Claris Lifesciences Ltd. (Gujarat High Court) in (2010) 326 ITR 251 (Gujarat) • Sadan Vikas (India) Ltd. (Delhi High Court) in (2011) 335 ITR 117 (Delhi) • Maruti Suzuki India Ltd. (Delhi High Court) in (2017) 397 ITR 728 (Delhi) • TVS Electronics Ltd. (Madras High Court) in (2019) 419 ITR 187 (Madras) 11.7 It was submitted that these decisions consistently hold that once the R&D facility is recognized and approved, the assessee cannot be denied weighted deduction merely due to delay in formal approval or administrative issues. The beneficial object of section 35(2AB) must be kept in mind. 12. We have heard the rival submissions of both the parties and perused the material placed on record, including the paper book, orders Printed from counselvise.com ITA No.432/Bang/2025 Page 12 of 17 . of the lower authorities and the rejoinder dated 20.06.2025 filed by the assessee. 12.1 The short issue for our consideration is whether the assessee is entitled to weighted deduction under section 35(2AB) of the Act for AY 2013-14 corresponding to PY 2012-13, when the approval in Form 3CM issued by DSIR mentions validity from 01.04.2013 to 31.03.2017. 12.2 It is not in dispute that the assessee had established in-house R&D facilities which were recognized by DSIR as early as 01.04.2007. The recognition was renewed from 01.04.2012 to 31.03.2015. It is also not in dispute that the assessee filed Form 3CK seeking approval under section 35(2AB) on 31.10.2013, i.e., before filing of return of income on 27.11.2013. Due to technical issues, a manual application was also filed on 26.12.2013. Subsequently, DSIR granted approval in Form 3CM for the period 01.04.2013 to 31.03.2017. 12.3 The Assessing Officer denied deduction on the ground that the approval was effective from 01.04.2013 and therefore, the same not applicable for the year under consideration. The Ld. CIT(A) confirmed the disallowance holding that in absence of valid Form 3CM / 3CL for the relevant year, the claim was not maintainable. 12.4 At this stage, it is necessary to examine the legal position applicable to AY 2013-14. Prior to amendment by the Finance Act, 2016 with effect from 01.07.2016, Rule 6(7A) did not require quantification of eligible expenditure by DSIR as a condition precedent for allowing deduction. The prescribed authority was required to approve the in- house R&D facility and submit its report in Form 3CL. The statutory scheme, as interpreted by various Hon’ble High Courts, was that once the facility is approved, the Assessing Officer cannot sit in judgment over Printed from counselvise.com ITA No.432/Bang/2025 Page 13 of 17 . such approval and the expenditure incurred on the approved facility is eligible for weighted deduction. 12.5 The Hon’ble Gujarat High Court in the judicial precedent of Commissioner of Income-tax vs. Claris Lifesciences Ltd. reported in [2008] 174 Taxman 113 (Gujarat)/[2010] 326 ITR 251 (Gujarat)/[2009] 221 CTR 301 (Gujarat)[07-08-2008] and the Hon’ble Delhi High Court in case of Commissioner of Income-tax - III vs. Sandan Vikas (India) Ltd. reported [2012] 22 taxmann.com 19 (Delhi)/[2012] 207 Taxman 216 (Delhi)/[2011] 335 ITR 117 (Delhi)[24-02-2011] have held that the date mentioned in the approval letter cannot operate as a cut-off date to deny deduction for expenditure incurred prior to formal approval, once the facility itself is approved. 12.6 The relevant para of Hon’ble Gujarat High Court in Claris Lifesciences (supra) is reproduced below for the sake of convenience: “The Tribunal has considered the submissions made on behalf of the assessee and took the view that section speaks of (i) development of facility; (ii) incurring of expenditure by the assessee for development of such facility; (iii) approval of the facility by the prescribed authority, which is \"DSIR\"; and (iv) allowance of weighted deduction on the expenditure so incurred by the assessee. The provisions nowhere suggest or imply that \"R & D\" facility is to be approved from a particular date and in other words, it is nowhere suggested that date of approval only will be cut-off date for eligibility of weighted deduction on the expenses incurred from that date onwards. A plain reading clearly manifests that the assessee has to develop facility, which presupposes incurring expenditure in this behalf, application to the prescribed authority, who after following proper procedure will approve the facility or otherwise and the assessee will be entitled to weighted deduction of any and all expenditure so incurred. The Tribunal has, therefore, come to the conclusion that on plain reading of section itself, the assessee is entitled to weighted deduction on expenditure so incurred by the assessee for development of facility. The Tribunal has also considered rule 6(5A) and Form No. 3CM and come to the conclusion that a plain and harmonious reading of rule and Form clearly suggests that once facility is approved, the entire expenditure so incurred on development of \"R & D\" facility has to be allowed for weighted deduction as provided by section 35(2AB). The Tribunal has also considered the legislative intention behind above enactment and observed that to boost up R & D facility in India, the Legislature has provided this provision to encourage the development of the facility by providing deduction of weighted expenditure. Since what is stated to be promoted was development of facility, intention of Printed from counselvise.com ITA No.432/Bang/2025 Page 14 of 17 . the Legislature by making above amendment is very clear that the entire expenditure incurred by the assessee on development of facility, if approved, has to be allowed for the purpose of weighted deduction.” 12.7 Likewise, the relevant para of Hon’ble Delhi High Court in Sandan Vikas (supra) is reproduced below for the sake of convenience: “The provision further states that in order to claim this weighted deduction, it is to be certified by the Competent Authority that the assessee had undertaken research and development activity. The competent authority in this behalf is Department of Scientific & Industrial Research (DSIR). The assessee had approached DSIR vide application dated 10th January, 2005. The DSIR vide its letter dated 23rd February, 2006 granted recognition of the in-house R&D facilities of the assessee company and also granted approval for the expenses incurred by the company on in-house R&D facility in prescribed form 3CM by letter dated 18th September, 2006. The Assessing Officer, however, refused to accord the benefit of the aforesaid provisions of weighted deduction to the assessee on the ground that recognition and approval was given by the DSIR in February/September 2006, i.e., in the next assessment year and, therefore, the assessee was not entitled to the benefit. The CIT(Appeal) accepted this view of the Assessing Officer and dismissed the appeal, however, the Income Tax Appellate Tribunal (hereinafter referred to as \"the Tribunal\") has come to the conclusion that the assessee would be entitled to weighted deductions of the aforesaid expenditure incurred by the assessee in terms of the Section 35(2AB) of the Act and in coming to this conclusion, the Tribunal has relied upon the judgment of Gujarat High Court in CIT v. Claris Lifesciences Ltd. [2010] 326 ITR 251/[2008] 174 Taxman 113. We have gone through the aforesaid judgment of the Gujarat High Court and find that Gujarat High Court detailed in no-uncertain terms that the cut-off date mentioned in the certificate issued by the DSIR would be of no relevance. What is to be seen is that the assessee was in indulging in R&D activity and had incurred the expenditure thereupon. Once a certificate by DSIR is issued, that would be sufficient to hold that the assessee fulfills the conditions laid down in the aforesaid provisions” 12.8 The Hon’ble Delhi High Court in Maruti Suzuki India Ltd. vs. Union of India reported in [2017] 84 taxmann.com 45 (Delhi)/[2017] 250 Taxman 113 (Delhi)/[2017] 397 ITR 728 (Delhi)[04-08-2017] has further held that what is relevant is the existence of recognition of the R&D facility and not the specific date mentioned in the certificate. The relevant para of Hon’ble Delhi High Court is reproduced below for the sake of convenience: “The settled position in law is that, for availing the benefit under Section 35 (2AB) of the Act what is relevant is not the date of recognition or the cut-off Printed from counselvise.com ITA No.432/Bang/2025 Page 15 of 17 . date mentioned in the certificate of the DSIR or even the date of approval but the existence of the recognition. If a R&D Centre is not recognised it is not entitled to deduction but if it is recognised, it is entitled to the benefit. The Gujarat High Court in Claris Lifesciences (supra) has rightly observed that the date of approval of the R&D Centre, not being a part of the provision, extending benefit only from the date of recognition \"amounts to reading more in the law which is not expressly provided\". 12.9 Similar view has been taken by the Hon’ble Madras High Court in TVS Electronics Ltd. in (2017) 419 ITR 187 (Madras) holding that an assessee cannot be penalized for bureaucratic delay in grant of approval. The relevant para of Hon’ble Madras High Court is reproduced below for the sake of convenience: “The Assessee cannot be punished for the bureaucratic delay in giving such approval for the year in question, which was in the hands of the Department concerned of the Central Government itself. On the very fact that for the period anterior and posterior to the year in question such approval was very well on the record of the Revenue, the weighted deduction for the expenditure incurred on the Scientific Research could not have been disallowed by the authorities below and, therefore, the learned Tribunal, in our view, rightly held such Scientific Research expenditure to be allowable under Section 35 (2AB) of the Act. Therefore, first two Questions of Law are answered in favour of the Assessee and against the revenue “ 12.10 In the present case, the R&D facilities of the assessee were admittedly recognized by DSIR during the relevant year. The application in Form 3CK was filed before the due date of filing the return. The delay in issuance of Form 3CM was on the part of DSIR. There is no material on record to show that DSIR rejected approval for AY 2013-14. The approval granted for subsequent period under the same application indicates that the facility satisfied prescribed conditions. 12.11 The decisions relied upon by the Ld. DR relate either to post- amendment years where quantification in Form 3CL became mandatory or relates to the facts/ situations involving expenditure outside approved facilities. Therefore, in our humble understanding, those decisions are Printed from counselvise.com ITA No.432/Bang/2025 Page 16 of 17 . distinguishable on facts and do not govern the present year which is prior to amendment. 12.12 The reliance placed by the Ld. CIT(A) on Goetze (India) Ltd. is also misplaced in the present facts of the case. The assessee had claimed deduction in the original return itself. It is not a case where a fresh claim was made without revising the return. Therefore, the ratio of Goetze does not apply. 12.13 Considering the beneficial nature of section 35(2AB) of the Act, the consistent judicial view prior to amendment, and the fact that the R&D facilities were recognized and the application for approval was filed within time, we are of the view that deduction cannot be denied merely on the ground that the approval letter mentions a later effective date. Accordingly, we hold that the assessee is entitled to weighted deduction under section 35(2AB) of the Act for the AY 2013-14, subject to verification of the quantum of eligible expenditure incurred on the approved in-house R&D facilities and excluding any expenditure on land or building. Hence, the addition of Rs. 3,10,42,992/- made by the Revenue is therefore directed to be deleted after necessary verification. Hence, the grounds raised by the assessee are hereby allowed. 13. Ground No. 6 raised by the assessee relates to accelerated deduction under section 35(2AB) of the Act. However, during the course of hearing, the Ld. AR submitted that the said ground has become infructuous, as the Assessing Officer has already allowed the actual R&D expenditure incurred by the assessee and the dispute survives only with regard to the weighted portion of the deduction. It was therefore submitted that the ground is not pressed. In view of the above submission, Ground No. 6 is dismissed as not pressed. Printed from counselvise.com ITA No.432/Bang/2025 Page 17 of 17 . 14. Ground No. 7 relates to the levy of interest under sections 234B and 234C of the Act. 15. The levy of interest under these sections is consequential and mandatory in nature. Since, we have allowed the claim of the assessee under section 35(2AB) of the Act subject to verification, the Assessing Officer is directed to recompute the interest, if any, under sections 234B and 234C while giving effect to this order. Accordingly, Ground No. 7 is treated as consequential and disposed of in the above terms. 16. In the result, the appeal filed by the assessee is partly allowed. Order pronounced in court on 25th day of February, 2026 Sd/- Sd/- (KESHAV DUBEY) (WASEEM AHMED) Judicial Member Accountant Member Bangalore Dated, 25th February, 2026 / vms / Copy to: 1. The Applicant 2. The Respondent 3. The CIT 4. The CIT(A) 5. The DR, ITAT, Bangalore. 6. Guard file By order Asst. Registrar, ITAT, Bangalore Printed from counselvise.com "