9911796707
TMI Blog1998 (4) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... (c) Interest commission and foreign bank charges 95,450 Total 4,10,551 The Income-tax Officer, while completing the assessment under section 143(3) of the Act allowed weighted deduction in respect of foreign travel expenses to the extent of Rs. 45,000 and disallowed the balance on the ground that the foreign travel extended beyond a period of 75 days as approved by the Reserve Bank of India. As respects the agency commission, the claim is found to be in order by the Income-tax Officer. He also disallowed the entire expenses of interest, etc., of Rs. 95,450 as ineligible for weighted deduction. On appeal, the Commissioner of Income-tax (Appeals), Coimbatore, held that the entire expenses in respect of foreign travel is eligible for we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ission and foreign bank charges ? 2. Whether the Tribunal was right in holding that the assessee is not entitled to weighted deduction under section 35B to the extent of Rs. 2,61,454 being the correct claim made based on rule 6AA of the Income-tax Rules ? 3. Whether the Tribunal was right in holding that rule 6AA of the Income-tax Rules which came into effect on August 1, 1981, is not applicable to the assessment year 1981-82 ?" The arguments of Mr. K. Vaitheeswaran, learned counsel representing S. Subbaraya Aiyar, learned counsel appearing for the applicant and of Mrs. Chitra Venkataraman, learned junior standing counsel (Taxes), representing the Revenue were heard. Section 35B(1)(a) dealing with export markets development allowanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the sale outside India of such goods, services or facilities. We are unable to comprehend as to how interest, commission and foreign bank charges, amounting to Rs. 95,450 can if at all fall as an expenditure concerning maintenance outside India of a branch, office or agency for the promotion of the sale outside India of such goods, services or facilities. The nature of the expenditure speaks for itself and no further elucidation is necessary that such expenditure can if at all fall within sub-clause (iv) of clause (b). In this view of the matter, we are of the view that the Tribunal was rather right in holding that the assessee is not entitled to weighted deduction under section 35B in respect of interest, commission and foreign bank ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f such goods ; (c) maintenance of a laboratory or other facilities for quality control or inspection of such goods : Provided that in a case where only part of the sale is made outside India, the amount of expenditure incurred on the maintenance of such laboratory or other facilities which shall qualify for deduction under clause (a) of sub-section (1) of section 35B shall not exceed the amount which bears the same proportion as the value of the turnover in respect of such exports bears to the turnover of the business in respect of which the laboratory or other facilities are maintained ; (d) purchase of foreign trade periodicals or journals related to the business of the assessee ; (e) litigation outside India for the purposes of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trospective operation with effect from April 1, 1981, the date of the commencement of the assessment year. Axiomatic a proposition of law it is, that a rule or a provision of a statute, which is in force on and from the date of the commencement of the assessment year alone is applicable to the assessment year in question and to put it otherwise, as the rule or statutory provision came into force subsequent to the day of commencement of the assessment year, such rule or statutory provision is not at all applicable to the assessment year in question. No decision for such a proposition is necessary and if any decision is needed even for such a proposition of law, we may quote here the decision emerging from a Division Bench of this court, in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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