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TMI Blog1981 (9) TMI 101X X X X Extracts X X X X X X X X Extracts X X X X ..... (iii) of the Income-tax Act ? 2. Whether, on the facts and in the circumstances of the case, the assessee was entitled to relief under section 80J of the Income-tax Act on the basis of the gross capital without deducting the value of the borrowed capital employed in the undertaking ?" The relevant assessment year is 1973-74. The assessee claimed weighted deduction in respect of shipping freight, railway freight and insurance charges relating to export of some of its commodities. This claim was made under s. 35B(1)(b)(iii) of the I.T. Act, 1961. The ITO was of the opinion that the assessee could not get weighted deduction in respect of the expenditure incurred on the carriage of goods to their destination outside India or on the insuranc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... connection therewith or expenditure (wherever incurred) on the carriage of such goods to their destination outside India or on the insurance of such goods while in transit " were inserted in cl. (b)(iii) of s. 35B(1) by the Finance Act, 1970, with effect from 1st April, 1968. The first part of this clause which reads " distribution, supply or provision outside India of such goods, services or facilities " deals with the expenditure which qualifies for grant of development allowance. The second part of the clause which starts with the words " not being " and which was added by the Finance Act, 1970, deals with the expenditure which is not to be taken into account in granting the development allowance. The second part of the clause, in our op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b)(iii), as rightly stated by Sampath Iyengar, excludes from the computation of export markets allowance the following: (a) expenditure incurred in India in connection with the distribution, supply or provision of the goods, etc., outside India ; (b) expenditure wherever incurred for the carriage of the goods to their destination outside India; and (c) expenditure incurred to insure the goods while in transit. Learned counsel for the assessee relied upon the observations in Aiyar's Income Tax Act, 2nd Edn., p. 544. This does support the learned counsel, but for the reasons already stated by us, we are unable to agree with the meaning of the section as given in this book. As regards the second question, which deals with s. 80J, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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