COMMISSIONER OF INCOME TAX Vs. INDIAN HANDICRAFTS EMPORIUM

JUDGEMENT

(1.) FOLLOWING questions of law have been referred to this Court for opinion by the Tribunal, Delhi Bench :

(2.) AS per the statement of facts, the assessee, a registered firm, deals in ivory goods, jewellery and other handicrafts. Part of the sales for Rs. 8 lakhs during the asst. yr. 1976-77 were by way of export of goods outside India. There were certain other sales in India against foreign currency received in India amounting to Rs. 21 lakhs. Proceeds were realised in Indian currency but the sales were stated to have been made to foreign nationals. Weighted deduction on the entire expenditure totalling Rs. 8, 84, 920 was claimed by the assessee, which was incurred on earning this income. The ITO completely denied the claim of the assessee. The CIT (A) held that the assessee was entitled to get deduction on export of goods outside India to the extent of Rs. 8 lakhs. In respect of other sales, it was held that the assessee was not entitled for weighted deduction. Before the Tribunal reference was made to the order of the Tribunal for the earlier asst. yr. 1975-76. On that basis the Tribunal held that the sales to the extent of Rs. 21 lakhs were against foreign currency received in India, therefore, the same were export sales. In this background, the first question of law has been referred for opinion.

(3.) ON the facts found none of the expenditure is proved to have been wholly or exclusively incurred for any of the purposes mentioned in either of the sub-clauses and as such both the questions are answered in affirmative, namely, in favour of the Revenue and against the assessee.