INTAS PHARMACEUTICALS LTD.,AHMEDABAD V. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-2(1)(1), AHMEDABAD

MA 118/AHD/2024

AI Insights

The case involves Intas Pharmaceuticals Ltd., which filed Miscellaneous Applications (M.A Nos.116 to 118/Ahd/2024) against the Assistant Commissioner of Income Tax concerning the denial of deductions under Section 35(2AB) of the Income Tax Act for the assessment years 2009-10 to 2011-12. The Tribunal had previously taken a contrary view for these years compared to its decision for 2013-14 and 2014-15, where the claims were allowed. The Tribunal, upon reviewing the submissions and the precedent set in the later years, decided to modify its earlier stance and grant the deductions claimed by the assessee.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 41002 (ITAT-AHMEDABAD)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 07-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2011-2012
• Laws Referred To: Section 35(2AB) of the Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RIGNESH DAS
• Assessee Lawyers: S.N. SOPARKAR
• Section: 22

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, AHMEDABAD BEFORE SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER & SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER M.A Nos.116 to 118/Ahd/2024 in I.T.A. Nos.1334 to 1336/Ahd/2017 (Assessment Years: 2009-10 to 2011-12) Intas Pharmaceuticals Ltd., 203, Chinubhai Centre, Off. Nehru Bridge, Ashram Road, Ahmedabad-380009. Vs. The Assistant Commissioner of Income Tax, Circle-2(1)(1), Ahmedabad. [PAN No.AAACI5120L] (Appellant) .. (Respondent) Appellant by : Shri S.N. Soparkar, Sr. Advocate and Shri Parin Shah, AR Respondent by: Shri Rignesh Das, Sr. D.R Date of Hearing 20.12.2024 Date of Pronouncement 07.03.2025 O R D E R PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER: The assessee vide these Miscellaneous Applications, have pointed out certain mistake apparent from the record with respect to ground related to the claim of deduction under Section 35(2AB) of the Act relating to expenditure of exhibit Batches, building material and patent filing fees. 2. At the outset, we note that Registry has pointed out that the present application is time barred by 22 days. In this regard, the assessee submitted that order of Hon’ble ITAT Ahmedabad dated 31.01.2024 was served upon the assessee on 27.02.2024 whereas the impugned M.A Nos116 to 118/Ahd/2024 In ITA Nos.1334 to 1336/Ahd/2017 Asst.Years –2009-10 to 2011-12 - 2– Miscellaneous Application filed on 23.08.2024 i.e. within the period of six months from the end of the month in which the order was served. Accordingly, there is no delay in filing of Miscellaneous Application. On going through the records we are of the view that the present Miscellaneous Application is not time barred and accordingly, there is no delay on part of the assessee in filing of the present Miscellaneous Application. 3. During the course of hearing, the Counsel for the assessee submitted that while passing the order for assessment years 2013-14 and 2014-15, the same Constitution of Members hearing identical issue had allowed this issue in favour of the assessee vide order dated 31.01.2024. However, for the impugned assessment years under consideration i.e. A.Y. 2009-10 to 2011-12, while dealing with the same issue related to claim of weighted deduction on exhibit batches, patent fees etc., the same Constitution of Members have taken a contrary view and decided the issue against the assessee. Accordingly, it was submitted that with respect to the same issue, contrary views have been taken by the same Constitution of Members while dealing with different assessment years. On going the case records, and in light of the submissions of the Counsel for the assessee, we are of the considered view that order dated 30.01.2024 for assessment years 2009-10 to 2011-12 may be modified and claim of expenditure under Section 35(2AB) with respect to weighted deduction on exhibit batches may be allowed to the assessee in M.A Nos116 to 118/Ahd/2024 In ITA Nos.1334 to 1336/Ahd/2017 Asst.Years –2009-10 to 2011-12 - 3– light of similar relief granted to the assessee for A.Y. 2013-14 and 2014- 15 vide order 31.01.2024. 4. We note that the ITAT has adjudicated above ground in A.Y. 2013-14 & A.Y. 2014-15 on page 25 to 33 of the order, the relevant extracts of which are reproduced hereunder: “52. As for the expenditure incurred on Exhibit Batches and other expenses, the explanation regarding nature of the expenditure being in relation to samples/prototype obtained for pilot studies and in relation to labour cost, staff training etc. in the R&D activity only, and therefore are also eligible to claim weighted deduction. In view of the above, we hold that the entire claim of expenses u/s 35(2AB) were in accordance with law and called for no disallowance at all.” 5. Accordingly, Paragraph Nos. 40 to 42 of our order be replaced by the above Para 52 referred to above. 6. Accordingly, the Miscellaneous Application filed by the assessee is allowed. This Order pronounced in Open Court on 07.03.2025 Sd/- Sd/- (ANNAPURNA GUPTA) (SIDDHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 07.03.2025 Tanmay, Sr. PS TRUE COPY आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : 1. अपीलाथŎ / The Appellant 2. ŮȑथŎ / The Respondent. 3. संबंिधत आयकर आयुƅ / Concerned CIT 4. आयकर आयुƅ(अपील) / The CIT(A)- 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाडŊ फाईल / Guard file. आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad "