India - Income Tax Act 2010 - Saarc

1.215 CH. IV - COMPUTATION OF BUSINESS INCOME S. 35Ashall be allowed in respect of that asset under 17 [clause (ii) of sub-section (1)] ofsection 32 for the same or any subsequent previous year.(d) Any deduction made under this sub-section in respect of any expenditure onscientific research in excess of the expenditure actually incurred shall bedeemed to have been wrongly made for the purposes of this Act if the assesseefails to furnish within one year of the period allowed by the prescribed authorityfor completion of the programme, a certificate of its completion obtained fromthat authority, and the provisions of sub-section (5B) of section 155 shall applyaccordingly.]18[(3) If any question arises under this section as to whether, and if so, to whatextent, any activity constitutes or constituted, or any asset is or was being usedfor, scientific research, the Board shall refer the question to—(a) the Central Government, when such question relates to any activityunder clauses (ii) and (iii) of sub-section (1), and its decision shall befinal;(b) the prescribed authority 19 , when such question relates to any activityother than the activity specified in clause (a), whose decision shall befinal.](4) The provisions of sub-section (2) of section 32 shall apply in relation todeductions allowable under clause (iv) of sub-section (1) as they apply in relationto deductions allowable in respect of depreciation.20[(5) Where, in a scheme of amalgamation, the amalgamating company sells orotherwise transfers to the amalgamated company (being an Indian company)any asset representing expenditure of a capital nature on scientific research,—(i) the amalgamating company shall not be allowed the deduction underclause (ii) or clause (iii) of sub-section (2); and(ii) the provisions of this section shall, as far as may be, apply to theamalgamated company as they would have applied to the amalgamatingcompany if the latter had not so sold or otherwise transferredthe asset.]]21[Expenditure on acquisition of patent rights or copyrights.35A. (1) In respect of any expenditure of a capital nature incurred after the28th day of February, 1966 22 [but before the 1st day of April, 1998], on theacquisition of patent rights or copyrights (hereafter, in this section, referred to asrights) used for the purposes of the business, there shall, subject to and inaccordance with the provisions of this section, be allowed for each of the relevant17. Substituted for “clauses (i), (ii), (iia) and (iii) of sub-section (1) or under sub-section (1A)”by the Taxation Laws (Amendment & Miscellaneous Provisions) Act, 1986, w.e.f.1-4-1988.18. Substituted by the Finance Act, 1999, w.e.f. 1-4-2000.19. See rule 6.20. Inserted by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1967.21. Inserted by the Finance Act, 1966, w.e.f. 1-4-1966. For relevant case laws, see Taxmann’sMaster Guide to Income-tax Act.22. Inserted by the Finance (No. 2) Act, 1998, w.e.f. 1-4-1999.