2002 (11) TMI 47

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.... Income-tax Act, 1961, in respect of the foreign travel expenditure of Rs. 38,689 of Mr. R. Chand ?" Briefly stated, the material facts giving rise to the present reference are: The assessee is a private limited company engaged in the business of consultancy services. During the previous year ended June 30, 1977, for which the relevant assessment year was 1978-79, the assessee claimed as revenue expenditure the expenses, amounting to Rs. 38,689, incurred on the foreign travel of its managing director, namely, Mr. R. Chand, abroad. Weighted deduction on the said amount under section 35B of the Act was also claimed. However, while completing the assessment for the relevant assessment year, the Income-tax Officer took the view that the m....

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....1983] 5 ITD 471. In my opinion, the assessee satisfied all the conditions required for grant of weighted deduction in respect of the expenditure incurred. Accordingly, the assessee is entitled to the weighted deduction claimed." On the Revenue's moving an application under section 256(1) of the Act, the aforenoted question has been referred. We have heard Mr. R.D. Jolly, learned senior standing counsel for the Revenue. There is no appearance on behalf of the respondent-assessee. It is vehemently submitted by Mr. Jolly that while holding that the assessee was entitled to weighted deduction, the Tribunal has not indicated under which sub-clause of section 35B(1)(b) of the Act the claim of the assessee would fall. It is urged that a b....

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....ion on the said amount, the Tribunal has not even remotely adverted to the findings recorded by the Commissioner of Income-tax (Appeals). The Tribunal has merely observed that "the assessee is promoting export of its services". The basis for arriving at this conclusion is not indicated by the Tribunal. The principles and parameters, governing the allowance of weighted deduction under section 35B of the Act, are now well settled. In Stepwell Industries case [1997] 228 ITR 171 (SC) and Hero Cycles case [1997] 228 ITR 463 (SC), while disapproving the logic of the decision of the Special Bench of the Tribunal in J. Hemchand and Co., applied by the Tribunal in the instant case, their Lordships of the Supreme Court have been pleased to observe....