COMMISSIONER OF INCOME TAX Vs. SRIVILAS CASHEW CO

JUDGEMENT

(1.) THIS is an application under Section 261 of the Income tax Act, 1961, for a certificate to appeal to the Supreme Court from the judgment of this court in Income tax Reference No. 171 of 1988, dated August 12, 1991 (Srivilas Cashew Co. v. CIT [1992] 196 ITR 887). Construing the provisions of Section 35B(1)(b)(iv) of the Income-tax Act, 1961, this court took the view that, in order to get the benefit of weighted deduction, it is not necessary that the agent of the assessee outside India should act exclusively for the assessee. The commission paid to the agents outside India would amount to expenditure incurred by the assesses to maintain an agency outside India for the promotion of the sales of the assessee's goods outside India.

(2.) IT is submitted on behalf of the petitioner herein that the Karnataka High Court has taken a different view in Chief CIT v. Mysore Sales International Ltd. [1992] 195 ITR 457 and, therefore, it is necessary to have an authoritative decision of the Supreme Court on this question. Learned counsel took us through the judgment of the Karnataka High Court. We find that a contrary view has been taken by the Karnataka High Court.