TMI Blog1990 (12) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... ,517 if, on examination, he finds that the storage charges were for keeping the goods before their sale ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding that although rule 6AA of the Income-tax Rules, 1962, was introduced with effect from August 1, 1981, it would be applicable in this case as the assessment has been completed on September 11, 1984 (i.e., after introduction of the said rule) and, in that view, whether the Tribunal was correct in law in directing the Income-tax Officer to examine the assessee's claim for relief under section 35B(1)(b)(ix) read with rule 6AA of the Income-tax Rules, 1962, as an alternative contention ? " The facts are that the assessment for the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deduction under this section was not admissible for the assessment year 1980-81. In that view of the matter, he held that the Income-tax Officer incorrectly allowed weighted deduction in respect of the sum of Rs. 10,16,517 and, to this extent, the order of the Income-tax Officer was erroneous in so far as it was prejudicial to the interests of the Revenue. He also held that the Income-tax Officer committed a mistake in allowing weighted deduction in respect of insurance charges paid outside India during the accounting period which ended on December 31, 1979. The action of the Income-tax Officer in allowing weighted deduction on insurance charges of Rs. 14,508 was considered to be erroneous in so far as it was prejudicial to the interests of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal referred to the decision of the Kerala High Court in the case of CIT v. Asiatic Sea Foods [1986] 160 ITR 869, wherein it has been held that, when goods are stored in the foreign agent's cold storage, the expenditure incurred on storage and handling charges would be expenses on distribution and supply of goods outside India qualifying for weighted deduction. Since the facts of the assessee's case were not clear and needed verification, the Tribunal set aside the orders of the lower authorities on this point and restored the matter to the file of the Income-tax Officer. The Tribunal observed that if the warehouse charges are found on examination to have been incurred for keeping the assessee's goods before their sale, weighted deductio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g goods in the warehouse before the sale of goods exported, such expenditure by way of warehousing expenses would relate to distribution and supply of the goods outside India qualifying for weighted deduction. We are, therefore, of the view that the Tribunal is right in directing the Income-tax Officer to find out whether expenses for storage of the goods were incurred by the assessee in keeping the goods in the warehouse before their sale and if so to allow weighted deduction on such expenditure under section 35B(1)(b)(iii) of the Act. We, therefore, answer the first question in the affirmative and in favour of the assessee. So far as the second question is concerned, it must be answered against the assessee. Section 35B(1)(b)(ix) ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
