(1.) This is an Appeal filed under Section 260A of the Income Tax Act, 1961, by the Revenue, questioning the legality of the order dated 1.10.2004 made in ITA No. 77/PNJ/2002 on the file of Income Tax Appellate Tribunal (ITAT), Panaji Bench at Panaji, confirming the order of the Commissioner of Income Tax (Appeals), at Belgaum. Brief facts of the case leading to the filing of the Appeal may be stated as under:
(2.) The Revenue has urged the following grounds:
(3.) On service of notice in this appeal, the respondent/assessee entered appearance through his counsel.