2015 (6) TMI 143

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..... P. C. 1. This Reference is at the instance of the Revenue. The Tribunal had before it an application under section 256(1) of the Income Tax Act, 1961, then in force, of the Commissioner of Income Tax requiring the Tribunal to refer the following question of law. That question of law arises out of the order of the Tribunal dated 23rd May, 1988 in Income Tax Appeal 42/(Bom)/1985 : "Whether on the .....

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..... ent of foreign customers should be considered for weighted deduction. Before the Tribunal, the assessee raised a claim for weighted deduction on packing credit which the Tribunal allowed following a judgment of the High Court of Madhya Pradesh in the case of Commissioner of Income Tax vs. Vippy Solvex Pvt. Ltd. (1986) 159 ITR 487. It is in these circumstances that on 9th October, 1989 the Tribunal .....

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..... deduction cannot be granted on the interest paid on packing credit. Mere obtaining of a packing credit loan or payment of interest thereon in India cannot be said to entail the performance of any service outside India. This expenditure is, therefore, not deductible. We answer this question in favour of the Revenue in terms of the Division Bench judgment as nothing contrary thereto has been brought .....

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