Case Law Analysis
|Income Tax Appellate Tribunal
Section 35(2AB) | Weighted Deduction Applies to Gross R&D Expenditure, Not Net After Contract Income Deduction : ITAT Ahmedabad
The ITAT Ahmedabad has ruled that companies claiming weighted deduction under Section 35(2AB) may compute the deduction on gross scientific research expenditure, without reducing it by income earned from contract research. This clarifies a long-standing ambiguity and benefits pharmaceutical and tech firms that outsource R&D, ensuring they receive full incentive for domestic innovation spending.