(1.) THE Income-tax Appellate Tribunal, Jaipur, at the instance of the assessee, Wolkem Pvt. Ltd., has referred the following question of law for the opinion of this court:
(2.) THE background facts relevant for answering the instant reference, briefly stated are as follows :
(3.) THE Full Bench of the Gujarat High Court in CIT v. Bharat Iron and Steel Industries [1993] 199 ITR 67 analysing Section 41(1) observed that (page 79):