Weighted deduction under export market development rules denied for freight, packing, membership fees and bank commission.

Weighted deduction claims for freight, cartage, shipping charges, insurance, packing charges, carting and similar expenses were treated as falling within section 35B(1)(b)(iii) and not admissible as export market development allowance. Membership fees were also held to fall outside the specified sub-clauses of section 35B(1)(b), and bank commission was likewise outside the scope of the weighted deduction provision. The disallowance of the claimed deduction was upheld, and the issue was answered in favour of the Revenue.

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Issues: Whether weighted deduction under section 35B of the Income-tax Act, 1961 was allowable in respect of freight, cartage, shipping charges, insurance, packing charges, carting, membership fees and bank commission.

Analysis: Items relating to freight, cartage, shipping charges, insurance, packing charges, carting and similar expenditure fell within section 35B(1)(b)(iii) and were not admissible as export market development allowance. Membership fees did not fall within any of the specified sub-clauses of section 35B(1)(b). Bank commission was also held to be outside the scope of allowable weighted deduction.

Conclusion: The disallowance of weighted deduction for the claimed items was upheld and the question was answered in favour of the Revenue.

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