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TMI Blog1987 (4) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... , as part of the consideration for the technical know-how supplied by the former to the latter) as profit attributable to its priority industry for the purpose of the deduction under section 80-I of the Income-tax Act, 1961, for the assessment year 1969-70 ? 2. Whether, on the facts and in the circumstances of the case and in law, the Tribunal was justified in holding that the profit of Rs. 1,78,606 on the sale of the assets and miscellaneous receipts of Rs. 2,65,548 should be included in the profits attributable to the priority industry for the purpose of the deduction under section 80-1 of the Income-tax Act, 1961 ?" For the assessment year 1970-71, only one question is raised, which reads thus: " Whether, on the facts and in the ci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tly engaged in the production of pulp and paper from bamboo since last 5 years with a quality production of 30,000 tons of paper per annum; and Whereas, West Coast is willing to furnish such collaboration to Andhra Paper subject to the provisions of this Agreement; ..." The assessee claimed deduction under section 80-1 of the fees that it received from the said company on the ground that they constituted a part of its profits and gains attributable to its said priority industry. The Income-tax Officer rejected the claim on the ground that such deductions would be admissible only in regard to the profits that directly emerged from the manufacture and sale of paper. In appeal, the Appellate Assistant Commissioner, following the decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be answered in the affirmative and in favour of the assessee. The second question raised for the assessment year 4969-70 encompasses two items. The first relates to the amount of Rs. 1,78,606 realised by the assessee upon the sale of its assets. It is common ground that, in so far as this item is concerned, the question must be answered in the affirmative and in favour of the assessee having regard to the judgment of the Supreme Court in Cambay Electric Supply Industrial Co. Ltd. v. CIT [1978] 113 ITR 84. The second question for the assessment year 1969-70 also relates to the item of Rs. 2,65,548 which represents the recoveries of rent by the assessee from its staff and workers. It is common ground that this amount has been treated as p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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