TMI Blog1999 (6) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... circumstances of the case and having regard to the interpretation of section 36(1)(iv) of the Income-tax Act, 1961, and rules 87 and 88 of the Income-tax Rules, 1962, the Tribunal was right in law in holding that the assessee was entitled to a deduction of the entire initial contribution to the superannuation fund as a liability in computing the income of the assessee for the assessment years 1977-78 and 1978-79?" At the instance of the assessee : "2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the amounts representing commission paid to Dr. Beck and Co. A. G., West Germany, were not eligible for weighted deduction under section 35B for the assessment years 1977-78 and 1978-79 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Following the same we answer question No. 4 accordingly in favour of the Revenue. So far as question No. 3 is concerned, there is no dispute that the controversy therein stands concluded in favour of the Revenue by the decision of this court in the assessee's own case in respect of an earlier assessment year in Dr. Beck and Co. (Ind) Ltd. v. CIT [1994] 206 ITR 311 and Forbes Forbes Campbell and Co. Ltd. v. CIT [1994] 206 ITR 495. In the assessee's case cited above, it was contended by the assessee that export inspection charges fall in sub-clause (vi) of clause (b) of section 35B(1) of the Act which allows weighted deduction in respect of expenditure incurred by the assessee wholly and exclusively on furnishing to a person outside India s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture by virtue of the specific exclusion contained in sub-clause (iii) of clause (b). Sub-clause (iii), which refers to expenditure incurred on 'distribution, supply or provision outside India of such goods, services or facilities', specifically excludes expenditure incurred in India in connection therewith when it says : 'distribution, supply or provision outside India of such goods, services or facilities, not being expenditure incurred in India in connection therewith. . . .' Expenditure incurred on inspection of goods in India for export, commonly referred to as 'export inspection charges', is undoubtedly an expenditure incurred in India in connection with the supply of goods outside India and, as such, falls in the exclusion contai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n incorporated with effect from August 1, 1981, it should be applied retrospectively to the assessment years in question. In support of his contention, he relies on the ratio of the decision of the Supreme Court in CWT v. Sharvan Kumar Swarup and Sons [1994] 210 ITR 886. We have given our careful consideration to the rival submissions of learned counsel for the parties in regard to the applicability of rule 6AA which came into force on August 1, 1981, for deciding whether the expenditure incurred in the previous years relevant to the assessment years 1977-78 and 1978-79 qualifies for weighted deduction under section 35B(1)(a) of the Act, We have also perused the decision of the Supreme Court in CWT v. Sharvan Kumar Swarup and Sons [1994] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of no avail to the assessee in support of its claim for weighted deduction in respect of the assessment years 1977-78 and 1978-79. It was only with effect from August 1, 1981, that certain activities were prescribed for the purposes of sub-clause (ix) of clause (b) of sub-section (1) of section 35B of the Act by insertion of rule 6AA by the Income-tax (Eighth Amendment) Rules, 1981, as activities for the promotion of sale outside India of the goods, services or facilities expenditure on which would qualify for weighted deduction under section 35B(1)(a). The case of the assessee is that export inspection charges would fall under that rule. We do not find any merit in the above contention of the assessee. Rule 6AA prescribes certain other ..... X X X X Extracts X X X X X X X X Extracts X X X X
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