COMMISSIONER OF INCOME TAX Vs. BIRLA BROS P LTD

JUDGEMENT

(1.) THE Tribunal referred the following questions of law under s. 256(1) of the IT Act, 1961 ('the Act) to this Court; "R.A. No. 823 (Cal) of 1985 (Asst. yr. 1976-77): 1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in deleting the disallowance made under s. 40(c) of the IT Act, 1961 in respect of medical expenses reimbursed to assessee's managing director?

(2.) WHETHER , on the facts and in the circumstances of the case, the Tribunal was justified in law in allowing the entire initial contribution to the approved superannuation fund in the year of the contribution? R.A. No. 824 (Cal) of 1985 (Asst. yr. 1977-78): 1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in deleting the disallowance made under s. 40(c) of the IT Act, 1961 in respect of medical expenses reimbursed to assessee's managing director? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in allowing the entire initial contribution to the approved superannuation fund in the year of contribution?

(3.) IN respect of the asst. yrs. 1977-78 and 1978-79 respectively regarding question No. 3 and question No. 2 the finding of the Tribunal is as follows: "Ground No. 2 in IT Appeal Nos. 2324 ands 2325 (Cal) of 1983 relates to the assessee's claim for weighted deduction under s. 35B (1)(b) (viii) of the Act on payments made to Orient Paper Mills for rendering technical services to Nigerian Paper Mills under the memorandum of arrangement dt. 15th July, 1974 between the assessee-company and Orient Paper Mills Ltd. The ITO declined to accept the assessee's claim under s. 35B (1)(b)(viii) of the Act. But he did not give any intelligible reason for such rejection. It seems that he was under the impression that the expenses made by the assessee through the agent do not qualify for the claim. But we do not find any such restriction in the language or spirit of the section itself. It was not disputed by the ITO that the expenses were made for performance of service outside India. In such circumstances we agree with the CIT (A) that the assessee-company was entitled to weighted deduction as claimed."