COMMISSIONER OF INCOME TAX Vs. SETH ABDULLA YUSUF

JUDGEMENT

(1.) IN this reference made by the INcome-tax Appellate Tribunal, Jaipur Bench, Jaipur (hereinafter referred to as "the Tribunal"), the following question has been referred for the opinion of this court:

(2.) M/s. Seth Abdulla Yusuf, hereinafter referred to as the assessee, is a registered firm. It derives income as commission agent in fruits and vegetables. In respect of the assessment year 1974-75, the assessee claimed deduction of Rs. 7,945 as business expenditure on account of expenses incurred in providing refreshments such as tea, soft drinks, etc., to the customers who visited the assessee's business premises. The said expenditure was disallowed by the Income-tax Officer under Section 37(2B) of the Income-tax Act, 1961, hereinafter referred to as "the Act". The Appellate Assistant Commissioner on appeal held that the expenses are not in the nature of entertainment and, accordingly, he deleted the addition. The Tribunal while dismissing the departmental appeal has referred the aforesaid question for the opinion of this court.