Section 35(2AA) — the law in short
What the courts have decided on section 35(2AA), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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Statutory position — the s.35(2AB) and s.35(2AA) weighting: two hundred, then one hundred and fifty, then one hundred per cent
CBDT Circulars & InstructionsCuts both ways
What weighting do I put on my client's in-house R&D spend, and from which assessment year did each rate change?
For s.35(2AB) the weighting was two hundred per cent, fell to one hundred and fifty per cent from AY 2018-19, and falls to a hundred per cent — that is, no weighting at all — for expenditure incurred in a previous year relevant to an assessment year beginning on or after 1 April 2021. The current text reads "a deduction of a sum equal to one and one-half times of the expenditure so incurred", cut down by a proviso which for AY 2021-22 onwards makes the deduction "equal to the expenditure so incurred". Section 35(2AA), for sums paid to a National Laboratory, University, Indian Institute of Technology or specified person for approved research, follows the same shape: one and one-half times the sum paid, reduced by a second proviso to the sum so paid for an assessment year beginning on or after 1 April 2021.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.
