1999 (3) TMI 50

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ed by R. JAYASIMHA BABU J.---The question referred to us at the instance of the Revenue is : "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the assessee is entitled for weighted deduction under section 35B(1)(b)(iv) of the Act in respect of the expenditure on payment of commission outside India treating the expenditure as one on 'ma....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....he order made by it on the appeal preferred by the assessee, which had earlier unsuccessfully appealed to the Commissioner against the order of the Income-tax Officer, who had rejected the claim, has held that the word "maintain" in section 35B of the Act does not require the payment of any consideration, but refers only to the continuance of the relationship between principal and agent, and since....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ort or visit to the places outside India. The term "agency" refers to the representative presence of the assessee outside India through another, such presence again being on continuing basis, and not merely for a single action or a single transaction. The fact that the assessee had an agent outside, and had paid commission on the sales effected through that agent does not render the payment of tha....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....e a proof that the branch, office or agency was maintained outside India. The maintenance referred to in this case is maintenance, for which, expenditure was required and not merely a willingness on the part of the assessee to transact business with that agent outside India on more than one occasion. The whole object of section 35B is to provide a weighted deduction on expenditure incurred. If the....