Weighted deduction for export-related charges denied where section 35B exclusions covered carriage, insurance, and India-incurred expenses.

Section 35B weighted deduction was considered for transport, insurance, and shipping and forwarding charges connected with export of goods. Although such expenditure was said to relate to the distribution or supply of exported goods, the provision expressly excludes expenditure incurred in India, carriage of exported goods to their destination outside India, and insurance while the goods are in transit. On that construction, the claimed expenses did not qualify for weighted deduction, and the rejection of the claim was upheld.

---

---

Issues: Whether the assessee was entitled to weighted deduction under section 35B of the Income-tax Act, 1961 in respect of transport charges, insurance and shipping and forwarding charges incurred in connection with export of goods.

Analysis: The expenditure claimed fell within the ambit of section 35B(1)(b)(iii) as being connected with the distribution or supply of exported goods. However, the provision expressly excludes expenditure incurred in India, expenditure on carriage of exported goods to their destination outside India, and expenditure on insurance of such goods while in transit from qualifying for weighted deduction.

Conclusion: The claim for weighted deduction was not allowable, and the rejection of the claim was upheld.

---