TMI Blog1980 (1) TMI 18X X X X Extracts X X X X X X X X Extracts X X X X ..... s 1964-65, 1965-66, 1966-67 and 1967-68 ?" The assessee carries on business in the manufacture and sale of cycles and cycle parts. In the returns filed for the years under consideration, the assessee deducted the contributions made by it to the superannuation fund, life insurance fund and Tube Investments Educational Policy Fund of M/s. Tube Investments Ltd., Birmingham, to the credit of the employees who were serving it in the relevant years. For instance, taking the assessment year 1965-66, the assessee had the benefit of the services of one Mr. Tracy and the amount paid on his account to the respective funds mentioned above came to Rs. 4,395. For the subsequent years there were similar payments in respect of the very same person and ot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal in its order came up on reference to this court and the decision of this court is reported in CIT v. Carborundum Universal Ltd. [1977] 110 ITR 621. In that case also, the amount had been paid in respect of a person by name Jackson who worked as the general works manager in the factory of that company. In that case, the agreement with the foreign company was also annexed to the statement of the case and this court considered the allowability of the expenditure in the context of s. 36(1)(iv) and s. 28. At page 629 of the report, after referring to the decision in Badridas Daga v. CIT [1958] 34 ITR 10 (SC) and to a passage at p. 15 of the said report, it was observed : " We are of the opinion that this decision also has no application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . " The learned counsel for the Commissioner contended that the answer rendered in that reference would squarely apply to the present case. Learned counsel for the assessee, however, contended that Mr. Tracy and other persons, in respect of whom payments to the superannuation fund were made, were not the assessee's employees, that they were persons whose services were merely lent to the assessee under the collaboration agreement which was approved by the Govt. of India and that in such case, there was absolutely no scope for the application of s. 36(1)(iv). He, therefore, submitted that the decision in the case of Carborundum Universal Ltd. [1977] 110 ITR 621 (Mad) would not apply here. He also cited a decision of the Calcutta High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scope of s. 36(1)(iv) and the claim for deduction of the amount paid to such a fund could be considered under other provisions. In view of this difference in approach, we would follow the decision of this court. However, in the present case, the case of the assessee that Mr. Tracy and others were not its employees had not been gone into by the AAC and by the Tribunal. It is not clear, according to Mr. Jayaraman, whether the assessee raised this point that Mr. Tracy and others were not its employees. Apparently because the AAC and the Tribunal were inclined to accept the assessee's claim, the assessee had no opportunity to put forward the entire case before them. If Mr. Tracy and others were employees of the assessee, then the case decide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his is an entirely new argument addressed on behalf of the assessee and that the assessee cannot be permitted to make out a new case at this stage. As we we have already pointed out, the AAC was inclined to allow the assessee's claim on the basis of an earlier order of the Tribunal in the case of a sister concern of the assessee. However, in the grounds of appeal before the AAC, the assessee had pointed out "The Income-tax Officer should have held that the appellants were under an obligation to contribute to the said funds and that, therefore, such contribution was properly allowable either under section 28 or under section 37(1). " The implication behind this ground is that the amount would not come within the scope of s. 36(1)(iv) and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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