(1.) AT the instance of the Revenue, the following question has been referred to us :
(2.) THE assessee is a non-resident company, which secured a letter of intent from Neyveli Lignite Corporation on April 13, 1981, for carrying out certain works to establish a project office and to commence activities in India from that date. However, it secured the approval of the Reserve Bank of India for establishing its project office only subsequently. It also obtained the registration under the Companies Act subsequent to April 13, 1981. THE Income-tax Officer disallowed the expenditure incurred for the period prior to October 1, 1981, on the ground that during that period, the permission of the Reserve Bank was not in force. THE fact that the expenditure had been incurred was not doubted.