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1991 (1) TMI 35 - HC - Income TaxApplication To Direct Reference Export Market Development Allowance Limitation Revision Weighted Deduction
Issues:
1. Computation of time for filing an application under section 256(2) for reference to the High Court. 2. Justification of the Income-tax Appellate Tribunal's decision regarding the expenditure under section 35B of the Income-tax Act. Analysis: 1. The judgment addresses the issue of the computation of time for filing an application under section 256(2) for reference to the High Court. The respondent argues that the application is time-barred as the order under section 256(1) was received by the Chief Commissioner of Income-tax on May 22, 1989. However, the petitioner contends that the limitation should be computed from the date when the order was received by the Commissioner of Income-tax, which was on August 14, 1989. The High Court clarifies that the Commissioner of Income-tax, who filed the application under section 256(1), is the relevant party for receiving the order, not the Chief Commissioner. The court emphasizes that the limitation period starts when the order is served on the Commissioner of Income-tax, and in this case, the petitioner correctly calculated the limitation period from the date of service on them. 2. The judgment also delves into the merits of the case concerning the interpretation of section 35B of the Income-tax Act. The petitioner questions the Income-tax Appellate Tribunal's decision on the expenditure incurred for the performance of a contract, arguing that it should be entitled to deduction under section 35B. The High Court acknowledges that questions of law arise regarding the justification of the Tribunal's decision and directs the Tribunal to state the case and refer the questions of law to the court for further examination. This issue highlights the importance of determining the eligibility of expenditures for deductions under specific provisions of the Income-tax Act, emphasizing the need for clarity and consistency in the application of tax laws.
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