DOLPHIN LABORATORIES LTD Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) ON an application under S. 256(1) of the IT Act, 1961, the Tribunal has referred the following question for our opinion :

(2.) THE assessee is a manufacturer and seller of drugs and pharmaceutical products. The assessment year involved is 1985-86 for which the accounting year ended on 30th June, 1984. During the previous year assessee has incurred expenditure on technical literatures and samples and claimed an amount on that expenditure to the tune of Rs. 9,29,545 on literature and Rs. 12,41,343 on samples. ITO has applied the provisions of S. 37(3A) of the Act, 1961 and disallowed part of the expenditure claimed by the assessee, by applying the provision of sub-s. (3A) of S. 37 of the Act, 1961.

(3.) CONSIDERING the submission and aforesaid undisputed facts following the decision of the apex Court in case of Eskayef (supra) we answer the question on medical samples in affirmative i.e., in favour of the Revenue and against the assessee.