9911796707
TMI Blog1981 (12) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... vii) Packing and forwarding NIL 2,69,120 (b) Rs. Rs. (i) Office and godown rent 21,666 allowed 4,187 28,466 allowed 3640 (ii) Salaries to staff 43,770 allowed 10,948 51,368 allowed 12,842 (iii) Postage & Telegram 44,634 allowed 17,900 allowed 16,720 (iv) Printing & Stationery 3,387 allowed 1,000 allowed 2,000 (v) Directors Remuneration 1,20,000 allowed 30,000 allowed 30,000 2. The assessee comes up in appeal before us claiming full deduction on those items being pure export house. The Revenue also filed appeals in ITA Nos. 4181 and 4532 (Del) 80 in which the weighted deductions allowed by the CIT (A) were challenged. For the sake of convenience they are disposed of by a common order. 3. With regard to certain ite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is accordingly directed to allow weighted deduction on 50 per cent of the claim for each of the above two years. 6. The next ground of appeal relates to deductions partially allowed by the CIT on the items listed in para(b) above. With regard to office rent, salaries to staff and Directors' remuneration, the CIT allocated proportionate expenditure between cost of procurement and sales. Accordingly the purchase and sale activities are equally allocated. After such allocation, the CIT (A) treated 25 per cent of 50 per cent of the total expenses as allowable deduction under s. 35-B. In the case of the Directors' remuneration, however, the allowable deduction was estimated at half of 50 per cent of the total remuneration. With regard to posta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otal turnover was Rs. 1,25,00,000 approximately and local sale was to the tune of Rs. 3,63,000. The percentage of export accounted for more than 90 per cent of the total turnover for these years. The CIT allocated activities of the assessee into two categories, namely, purchase and sale. The activities relateable to purchase and pre-current are considered by him to be not allowable. The balance of the expenditure at 50 per cent of the total expenses on the above account are treated as for the purpose of sales activities. However, he arrived at 25 per cent of such amount for allowance of weighted deduction under s. 35-B. We are of the view that 25 per cent is on the lower side in view of the fact that more than 90 per cent of the sales const ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 9,296 & 9,249 respectively in addition to its allowance under s. 35-B rightly disallowed by the ITO for the above two years. The CIT while allowing these expenses observed as follows for the asst. yr. 1975-76. "4. In the next ground, the assessee complaint against the disallowance of Rs. 9,296 out of delegation expenses. Earlier in this order the Assessee's claim of weighted deduction in respect of an amount of Rs. 16,371 said to have been incurred on tours of foreign trading delegations in India was considered and I have directed the ITO to allow weighted deduction in respect thereof under s. 35-B. The IAC acting under s. 144-A, not only directed the disallowance of weighted deduction in respect of the entire amount of Rs. 16,371, but ..... X X X X Extracts X X X X X X X X Extracts X X X X
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