9911796707
TMI Blog1979 (3) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... consideration for-- (i) the provision of technical know-how which is likely to assist in the manufacture or processing of goods or materials, or in the installation or erection of machinery or plant for such manufacture or processing, or in the working of a mine, oil well or other source of mineral deposits, or in the search for, or discovery or testing of, mineral deposits or the winning of access to them, or in carrying out any operation relating to agriculture, animal husbandry, dairy or poultry farming, forestry or fishing, or (ii) rendering services in connection with the provision of such technical know-how, under an agreement entered into by the assessee with such person on or after the 1st day of April, 1969, and approved by the Board in this behalf, there shall, in accordance with and subject to the provisions of this section, be allowed a deduction from such income of an amount equal to 40% thereof, in computing the total income of the assessee : Provided that the application for such approval is made to the Board before the 1st day of October of the relevant assessment year : Provided further that approval of the Board shall not be necessary in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /min capacity, is obviously too small to exhaust a cooler with a total cooling air capacity of 1450 m3/min. 4.3. We are, therefore, of the opinion that it will be necessary to re-design the fan capacities for the present kiln output and provide adequate capacities to raise the kiln output at a later date when steady operating conditions are obtained after elimination of dust rushes. 4.4. Since any adjustment such as change in the grate speed of opening and closing of a fan damper affects the temperature and quantity of secondary air going into the kiln, and consequently the burning zone temperature and air to fuel ratio, it is essential that the cooler operation should be augmented by proper instrumentation and loop control to minimise the fluctuations in the burning zone temperature. 4.5. It will also be necessary to install continuous O2 and CO analyser for kiln flue gases and radiation pyrometer for recording burning zone temperature to control the excess air for satisfactory burning conditions and the burning zone temperature. 4.6. We have gone over the various calculations involved in determining output limitations of your sieze kiln and taking into consideration t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5.3. The location of the gas sampling probe should be such that representative samples of exhaust gases are obtained. This should be as close to the kiln inlet as possible. 5.4. Continuous Hood draft transmitter should be installed and its indication should be installed and its indication should be recorded. 5.5. Two colour radiator pyrometers with recorders should be installed for Burning Zone temperature record. 5.6. The chain density of Folax kiln should be increased to decrease the dust losses and improve the heat exchange. 5.7. Proper dust collecting system should be installed to reduce the dust losses. 5.8. The proper air distribution in the Folax cooler should be worked out. New fan of required capacities should be added and the cooler must be properly loop-controlled. 5.9. The possibility of replacing the existing single cyclone cooler exhaust gas dust collector with more efficient type of dust collector should be investigated. " The petitioner-company along with their application for approval submitted the agreement by way of letters and the reports mentioned above to the Central Board of Direct Taxes. The CBDT by a non-speaking order dated November ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al submitted the agreements by way of letters and the reports mentioned above to the CBDT for approval of the agreements under s. 80MM. The CBDT again by a non-speaking order dated November 29, 1973 (annex. P-1 to the petition) refused to approve the agreements on the ground that the agreements did not satisfy the requirements of law and the objectives behind s. 80MM of the Act. For the purpose of construction the significant features of section 80MM are as under : (i) There has to be an agreement between an Indian company and any person carrying business in India ; (ii) the said agreement must be having the provision of technical know-how which is likely to assist in the manufacture or processing of goods or materials, or in the installation of erection or machinery or plant for such manufacture or processing; and (iii) if the agreement is for rendition of service, the service must be in connection with the provisions of aforesaid technical know-how, which must fall in either of the clauses of sub-s. (2) of s. 80MM. The perusal of the agreements and the reports submitted by the petitioner-company leave no manner of doubt that the agreements in both the writ petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the report we are satisfied that for the reasons stated in our judgment for the aforesaid two writ petitions the requirements of s. 80MM were fully satisfied in this petition also. The only other contention raised by the learned counsel for the respondent was that the application for approval was submitted to the Board beyond the period of limitation as prescribed by proviso to section 80MM. The agreement was concluded on April 27, 1970, while the application for approval was filed on 24-12-1971. We, however, find that this was not the ground on which the approval was refused by the Board. The Board has merely refused approval by a non-speaking order and by saying that the Board considers that it does not satisfy the requirements of law and the objectives behind it. Since we are quashing the order and sending the matter back to the Board for passing a fresh order it will be open to the Board to consider the question of limitation also. For these reasons, the impugned order of the Board dated November 29, 1973, is quashed and the Central Board of Direct Taxes is directed to pass fresh orders in the light of the observations made above. Civil Writ Petitions Nos. 589 361 of 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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