Wockhardt Limited, Aurangabad V. Assistamt Commissioner of Income Tax, Circle -3, Aurangabad

MA 27/PUN/2023

• Counselvise Citation: [2023] 101 COUNSELVISE.COM (IT) 9920 (ITAT-PUNE)
• Duration Of Justice: 9 month(s) 11 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-11-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 16-11-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 09-02-2023
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 80IC; 80IC

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “C”, PUNE BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI S. S. VISWANETHRA RAVI, JUDICIAL MEMBER M.A. No.27/PUN/2023 (Arising out of ITA No.775/PUN/2019) िनधाᭅरण वषᭅ / Assessment Year : 2013-14 Wockhardt Limited, R&D Centre, D-4, MIDC, Chikalthana, Aurangabad. PAN : AAACW2472M Vs. ACIT, Circle-3, Aurangabad. Appellant Respondent आदेश / ORDER PER INTURI RAMA RAO, AM: This present Miscellaneous Application is filed by the assessee (in Revenue’s appeal) seeking the modification of the order passed by this Tribunal in ITA No.775/PUN/2019 for the assessment year 2013-14 dated 10.05.2022 on the ground that while deciding the issue of disallowance of deduction u/s 80IC of the Income Tax Act, 1961 (‘the Act’), the Tribunal should not have made order of remand to the Assessing Officer for fresh adjudication in the light of the decision of the Tribunal in assessee’s own case for earlier assessment years. Secondly, on the issue of disallowance of weighted deduction u/s 35(2AB) of the Act, the Assessee by : Shri Rajan Vora Revenue by : Shri Suhas Kulkarani Date of hearing : 17.11.2023 Date of pronouncement : 21.11.2023 MA No.27/PUN/2023 2 Tribunal should not have remanded the issue to the file of the Assessing Officer for fresh adjudication in respect of expenditure of Rs.23,57,00,078/-. 2. On perusal of the assessment order, it would reveal that the Assessing Officer made disallowance of excess claim of deduction u/s 80IC on the ground that the assessee company while computing the quantum of profits for the purpose of deduction u/s 80IC had not allocated of the R&D expenditure. On appeal before the ld. CIT(A), the ld. CIT(A) relying on the decision of the Hon’ble Bombay High Court in the case of Zandu Pharmaceutical Works vs. CIT, 350 ITR 366 (Bom.) allowed the deduction u/s 80IC without allocation of the R&D expenditure. This finding of the ld. CIT(A) was challenged by the Revenue before this Tribunal. From reading of para 19 of the impugned order of this Tribunal, it would be clear that the findings of the ld. CIT(A) were reversed by this Tribunal as the ld. CIT(A) had failed to examine the nexus between R&D activity and the production unit. The question whether or not there is nexus of the R&D expenditure with production unit is pure question of fact and the fact of the foundation should be led by the assessee company. On perusal of the orders of the Assessing Officer as well as the ld. CIT(A), it would be clear that the lower authorities had not MA No.27/PUN/2023 3 attempted to examine this nexus with reference to material on record. Therefore, we are of the considered opinion that the order of remand to the Assessing Officer for fresh adjudication made by this Tribunal is proper and most appropriate. In the circumstances, the averments made by the assessee in the present Miscellaneous Petition cannot be accepted and requires no modification. 3. As regards to the averments made on account of R&D expenditure of Rs.23,57,00,078/-, which was disallowed by the Assessing Officer but allowed by the ld. CIT(A), we find from perusal of the order of the ld. CIT(A) that the ld. CIT(A) without discussion as to how the expenditure in question on R&D expenditure had merely allowed the claim of the assessee. Therefore, the order of remand made by this Tribunal is proper and requires no modification. 4. In the result, the Miscellaneous Application filed by the assessee stands dismissed. Order pronounced on this 21 st day of November, 2023. Sd/- Sd/- (S. S. VISWANETHRA RAVI) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 21 st November, 2023. Sujeet MA No.27/PUN/2023 4 आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A)-2, Aurangabad. 4. The Pr. CIT-2, Aurangabad. 5. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “C” बᱶच, पुणे / DR, ITAT, “C” Bench, Pune. 6. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.