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TMI Blog1991 (9) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... the staff engaged in the export sales ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal is right in treating 75% of the salary and allowances to be eligible for weighted deduction and is not the order and the estimate at 75% unreasonable, unsupported by materials and based on conjecture and surmises ? " The respondent is a cashew company. It is an exporter. We are concerned with the assessment year 1977-78 for which the accounting period ended on November 30, 1976. Amongst others, the respondent-assessee claimed salary and allowances to the staff engaged in export sales in the sum of Rs. 43,000. Weighted deduction under section 35B in respect of the said amount was negatived by the Income-tax Officer. In appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 981 which, in turn, gave effect substantially to the decision of a Special Bench of the Tribunal in J. Hemchand and Co.'s case. It is clear from a reference to clause 3(a) of the circular aforesaid, which has been extracted in paragraph 7 of the judgment of this court, that the assessee will be entitled to weighted deduction in respect of the expenses on salary and the expenses on the staff engaged in the export sale irrespective of the fact whether the same is incurred in or outside India. Following the Bench decision of this court in I.T.R. Nos. 176 to 187 of 1987 (CIT v. Kerala Nut Food Co. [1991] 192 ITR 585), dated April 2, 1991, we answer question No. 1 referred to this court in the affirmative, in favour of the assessee and against t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore, answer question No. 2 in the affirmative and hold that the estimate made by the Tribunal, treating 75% of the salary and allowances to be eligible for weighted deduction, is purely arbitrary. It is not supported by materials. We answer the question to this extent but decline to fix the amount which the assessee is entitled to by way of deduction for salary and allowances to staff engaged in export sales under section 35B of the Act. That is a matter which the Tribunal should fix, regard being had to all the facts and circumstances. We, therefore, answer question No. 2, referred to this court, in part and direct the Tribunal to restore the appeal to file on this limited aspect and determine the quantum of deduction permissible tow ..... X X X X Extracts X X X X X X X X Extracts X X X X
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