- (1.) JAWAHAR LAL GUPTA, J. : The contest between the parties relate to the asst. yr. 1977-78. The assessee had returned an income of Rs. 30,42,836. The AO disallowed certain claims and found that the assessed taxable income was Rs. 35,99,140. The assessee filed an appeal. It was partially allowed. The Revenue and the assessee challenged the order passed by the CIT(A). The Tribunal granted partial relief to both sides. Still not satisfied, the Revenue and the assessee filed petitions under S. 256(1) of the IT Act, 1961. After consideration of the matter, the Tribunal has referred the following two questions for the opinion of this Court : 1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in allowing the assessee's claim of weighted deduction under S. 35B in respect of difference in exchange ?
(2.) WHETHER , on the facts and in the circumstances of the case, the Tribunal was justified in holding that the assessee was not entitled to the export market development allowance by way of weighted deduction in terms of S. 35B in respect of the following expenditure : 2. Mr. Sawhney, learned counsel for the Revenue has contended that the assessee was not entitled to weighted deduction on account of fluctuation in the rate of exchange. He has referred to the decisions in Gedore Tools (India) (P) Ltd. vs. CIT (1998) 148 CTR (Del) 610 : (1998) 233 ITR 712 (Del) : TC S18.1997 and Gedore Tools (P) Ltd. vs. CIT (2000) 161 CTR (Del) 412 : (1999) 238 ITR 268 (Del). Mr. Sawhney has further contended that the Tribunal had erred in accepting the assessee's claim on the basis of its decisions in respect of the weighted deduction on account of difference in exchange rate for the asst. yrs. 1974-75, 1975-76 and 1978-79. Mr. Sawhney has further contended that the assessee's claim cannot be accepted as he had failed to produce evidence to show that the deductions were admissible. Rs. (1) Clearing and forwarding charges 18,89,676 (ii) Carriage outward 3,23,250 (iii) Transit insurance charges 67,155 (iv) Air freight charges 24,551 (v) Bank commission 26,385 (vi) Discount 2,630 (vii) Interest on packing credit 3,49,067 (viii) Other interest 18,980" Mr. Sanjay Bansal, learned counsel for the assessee, has contended that if it is the Revenue's own case that the Tribunal has erred in relying upon its earlier decisions and that the matter should be decided afresh after hearing the parties, then, even the deductions disallowed by the Tribunal to the assessee on the basis of the decisions for the asst. yrs. 1974-75, 1975-76 and 1978-79, should not be sustained. The assessee should be given an opportunity to appear before the Tribunal and show that the deductions are within the ambit of one of the provisions contained in S. 35B(1)(b) of the Act. Mr. Bansal contends that the Revenue had failed to show that the weighted deduction allowed to the assessee on account of fluctuation in exchange rate was not covered by the provisions of S. 35B(1)(b). It had accepted the decisions of the Tribunal in respect of the three assessment years. Having not challenged those orders, it is not entitled to reagitate the matter before this Court.
(3.) AFTER hearing learned counsel for the parties and in view of the decision of their Lordships of the Supreme Court in CIT vs. Stepwell Industries Ltd. & Ors. (1997)142 CTR (SC) 345 : (1997) 228 ITR 171 (SC) : TC S15.1492, we dispose of these references by remitting the case to the Tribunal. The Tribunal shall decide the matter afresh after giving the parties an opportunity to prove their respective claims. Since we are remitting the matter, we do not consider it appropriate to comment upon the merits of the controversy as raised by the counsel. No costs.;