COMMISSIONER OF INCOME TAX Vs. ASSAM ASBESTOS LIMITED

JUDGEMENT

(1.) IN this application under Section 256(2) of the INcome-tax Act, 1961, the Department has prayed for a direction to refer the following two questions for the opinion of this court :

(2.) THE respondent-company carries on the business of manufacture and sale of asbestos. THE respondent/assessee claimed a deduction of Rs. 3,41,043 from the income as the said amount was provided towards expenditure for undertaking foreign tour. THE claim was rejected by the Assessing Officer. THE respondent being aggrieved preferred an appeal before the Commissioner of Income-tax (Appeals) at Guwahati. THE contention of the assessee was accepted by the Commissioner of Income-tax (Appeals). THE Department approached the Tribunal and the Tribunal also confirmed the order of the Commissioner of Income-tax (Appeals). According to the Department, the amount of Rs. 3,41,043 earmarked for payment on account of incentive to the dealers by way of undertaking foreign tours is not a business expenditure and, therefore, the assessee is not entitled to get any deduction under Section 37 of the Income-tax Act. As the Tribunal refused to interfere with the order of the Commissioner of Income-tax (Appeals), the Department requested the Tribunal to refer the aforesaid two questions for the opinion of this court. This was also rejected. While rejecting the request, the Tribunal observed thus :

(3.) IN the facts and circumstances of the case, however, we make no order as to costs.