9911796707
TMI BlogInterpretation of Sec.35B.X X X X Extracts X X X X X X X X Extracts X X X X ..... 35 B(1). In particular the instruction referred to expenses claimed on export division and emphasised that after critical examination of the nature of such expenditure the extent to which such expenditure could be said to fall wholly and exclusively within the meaning of one or more sub-clauses b of sub-sec 1 can be determined. 2. Attention may also be drawn to the decision of the Bombay High court in the case of M/s.Eldee Wire ropes Ltd.(114 ITR 485) which had been accepted by the board. The High Court had held that except for items covered under clause (iii), there is no warrant for excluding expenditure incurred in India as is covered in any sub-clause of clause b. The court further held that the assessee will have to satisfy the ITO t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision as also expenditure wherever incurred on the carriage of such goods to their destination outside India and on the insurance of such goods while in transit will not all the same get such benefit. c) wherever common expenses are incurred by an assessee that could properly and fairly be apportioned on any of the activities referred to in sub-clauses such a proportionate expense can be taken for the purpose of this section as wholly and exclusively on such activity. 4. It may be clarified that the board agrees with the above interpretation of the provisions of sec.35 B. The Tribunal has also correctly stated in the said order whether a particular claim made by an assessee falls under any one or more of the activities specified in those ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In some of the cases the Tribunal did mention that part of such expenses were attributable to preparation and submission of tenders for the supply outside India of goods, services etc. Even in such case, though on facts part of the activity may have nexus with sub-clause (v) but the question may still remain whether apportionment at 75% is reasonable or excessive. Such issue would be basically a finding of fact and can be further contested depending on the states of revenue involved by seeking reference to the High court by raising appropriate questions of law on the ground of perversity. Therefore each case should be considered in the light to whatever is stated above and framing of the question of law should be done carefully. 6. It may ..... X X X X Extracts X X X X X X X X Extracts X X X X
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