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TMI Blog2003 (3) TMI 84X X X X Extracts X X X X X X X X Extracts X X X X ..... 82, the following two questions of law have been referred to us for opinion under section 256(1) of the Income-tax Act, 1961. Question No. 1: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee-bank was not liable to be taxed in respect of the amounts credited to Interest Suspense Account being interest on sticky loans and advances?" ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing a non-resident, no allowance shall be made, in computing the income chargeable under the head 'Profits and gains of business or profession', in respect of so much of the expenditure in the nature of head office expenditure as is in excess of the amount computed as hereunder, namely:- (a) an amount equal to five per cent. of the adjusted total income; or (b) an amount equal to the average hea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibed limit and that prescribed limit is provided for by the least of the three items of expenditure mentioned in clauses (a), (b) and (c). Clause (a) refers to five per cent. of the net income whereas clause (b) refers to average expenditure and clause (c) refers to actual head office expenditure in Indian operations. In this case, the Income-tax Officer came to the conclusion that the assessee w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee was allowed deduction of Rs. 13,45,492 being the least of the three items of expenditure under clauses (a), (b) and (c) of section 44C. This view has been confirmed by the Tribunal. We do not see any reason to interfere with the order of the Tribunal. The average head office expenditure allowed by the Department for three earlier assessment years 1974-75, 1975-76 and 1976-77 was Rs. 13 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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