9911796707
TMI Blog1991 (1) TMI 124X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessment years concerned are 1969-70 to 1972-73. On the basis of the returns filed by the assessee, assessments were made for all these four years on August 3, 1971, September 27, 1971, November 23, 1971 and November 30, 1972, respectively. No weighted deduction was claimed or allowed by these assessment orders. On September 8, 1973, the assessee moved applications under section 154 for allowing weighted deduction under section 35B on account of export expenses for all these four years. The Income-tax Officer rejected the applications on two grounds : (i) That no such deduction was claimed in the returns filed by the assessee, and (ii) That the mistake pointed out does not attract the power of rectification under section 154. On appeal, the Appellate Assistant Commissioner agreed with the Incometax Officer. He too found that in the returns relating to the assessment years 1969-70 and 1970-71, no such claim was made. In the return for the assessment year 1971-72, the deduction was not claimed at the appropriate place at a different place, this claim was made. He found that this was subsequent interpolation. In the return relating to the assessment year 1972-73 again, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowed straightaway. It is evident from the statement of facts that out of four assessment years concerned herein, no claim for weighted deduction was made for two years. For the third year, it has been found to be an interpolation by the Appellate Assistant Commissioner which finding has not been set aside by the Tribunal. In the return for the fourth year, the claim was made at an inappropriate place. Evidently, no such plea was raised, nor any such deduction claimed at the time of the assessment. It is long after the assessment orders were passed that rectification applications were filed claiming the said deduction. Even though copies of the rectification applications have not been enclosed with the statement of the case, we called upon learned counsel for the assessee to produce a copy of the applications. Counsel has also accordingly placed before us a copy of the application filed by the assessee under section 154 relating to the assessment year 1971-72. (We are told that rectification applications for the other assessment years were in identical terms.) All that the application states is this : "We have to invite your kind attention to the fact that the above assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sufficient to enable him to consider whether the relief should be granted. In the absence of such material, no fault can be found with the Income-tax Officer for not making an order under section 84 favouring the assessee. It will be noticed from the provisions of section 84 that several conditions must be satisfied before the grant of relief can be considered. The industrial undertaking should not have been formed by the splitting up of, or the reconstruction of, a business already in existence. It should not have been formed by the transfer to a new business of building, machinery or plant previously used for any purpose. It should manufacture or produce articles in any part of India, which manufacture or production should have begun at any time within 23 years next following April 1, 1948, or such other further period as the Central Government may specify. An industrial undertaking manufacturing or producing articles should be found to employ 10 or more workers in a manufacturing process carried on with the aid of power or to employ 20 or more persons in a manufacturing process carried on without the aid o power. These are some of the conditions which need to be fulfilled before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g to a person outside India samples or technical information for the promotion of the sale of such goods, services or facilities ; (vii) travelling outside India for the promotion of the sale outside India of such goods, services or facilities, including travelling outward from, and return to, India; (viii) performance of services outside India in connection with, or incidental to, the execution of any contract for the supply outside India of such goods, services or facilities ; (ix) such other activities for the promotion of the sale outside India of such goods, services or facilities as may be prescribed." A perusal of the section shows that weighted deduction is permissible only in respect of certain specified types of expenditure. The several sub-clauses show that all such expenditure must have been incurred outside India. The further requirement is that such expenditure must have been incurred wholly and exclusively on the specified activities. The Appellate Assistant Commissioner has found that the trade commission paid by the assessee on the sales effected by it abroad to its foreign agent cannot be called expenditure incurred wholly and exclusively on performance of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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