COMMISSIONER OF INCOME TAX Vs. ZIPPERS INDIA

JUDGEMENT

(1.) The following question has been referred by the Income Tax Appellate Tribunal, Ahmedabad Bench, 'B' under section 256(1) of the Income Tax Act,1961 (the Act) at the instance of the Commissioner of Income Tax. Whether, the Appellate Tribunal is right in law and on facts in deleting the addition of Rs.1,41,276/- made u/s.37(3A) observing that commission was not included in the provisions of Sec.37(3B)

(2.) The Assessment Year is 1985-86 and the relevant accounting period is the financial year ended on 31/3/1985. The assessee, a registered partnership firm, claimed certain expenses which included local commission as well as export commission. The Assessing Officer invoked provisions of Section 37(3A) read with Section 37(3B) of the Act and disallowed a sum of Rs.1,41,276/- vide his order dated 25/3/1998.

(3.) The assessee carried the matter in appeal before Commissioner (Appeals) who accepted the claim of the assessee by relying upon the Circular issued by Central Board of Direct Taxes on 17/5/1978.