(a) Income-tax

----Reference---Special deduction---Assessee processing and exporting shrimps---Whether entitled to benefit of Ss.80-HH & 80-1---Question of law to be referred---Indian Income Tax Act, 1961, Ss. 80-HH, 80-I & 256.

Whether the assessee, engaged in the processing and export of shrimps, was entitled to the benefit of sections 80HH and 80-I of the Income Tax Act, 1961, was a question of law to be referred.

CIT v. Poyilakada Fisheries (Pot.) Ltd. (1996) 221 ITR 691 (Ker.) fol.

(b) Income-tax---

----Reference---Investment allowance---Computer and ice-plant---Weather entitled to benefit of S.32-A---Question of law to be referred---Indian Income Tax Act, 1961: Ss. 32-A & 256.

Held also, that whether the assessee was entitled to the benefit of investment allowance under section 32-A of the Income-tax Act, in respect of computer and ice plant and whether the commission paid to foreign agents was eligible for weighted deduction under section 35-B(1)(iv) were questions of law to be referred.

CIT v. Srivilas Cashew Co. (1993) 199 ITR 686 (Ker.) ref.

(c) Income-tax---

----Reference---Weighted deduction---Commission paid to foreign agents-- Whether allowable deduction---Question of law to be referred---Indian Income Tax Act, 1961, Ss. 35-B(1)(iv) & 256.

P.K. Ravindranatha Menon, Senior Advocate and N.R.K. Nair for Petitioner.

P. Balachandran for Respondent.

JUDGMENT

V.V. KAMAT, J. ---By this petition, the Revenue seeks reference of the following three questions:

"(1) Whether, on the facts and in the circumstances of the case, the assessee, engaged in the processing and export of shrimps, is entitled to the benefit of sections 80-HH and 80-1 of the Income Tax Act, 1961?

(2) Whether, on the facts and in the circumstances of the case, the assessee engaged in the processing and export of shrimps, is entitled to the benefit of investment allowance under section 32-A of the Income Tax Act, 1961, in respect of computer and ice plant?

(3) Whether, on the facts and in the circumstances of the case---

(i) the commission of Rs.1,08,030 claimed to have been paid by the assessee to foreign agents is an allowable deduction under section 35-B(1)(iv) of the Income Tax Act?

(ii) does the assessee satisfy the conditions laid down in section 35-B (1)(iv) to claim deduction of the commission said to have been paid to foreign agents under section 35-B(l)(iv)?"

On hearing learned counsel, it is more than clear that question No. l is required to be referred as a follow suit in view of our earlier decision in Original Petition No.15730 of 1994---CIT v. Poyilakada Fisheries (P.) Ltd. No. l (1996) 221 ITR 691 (Ker).

Similarly with regard to question No.2 as it relates to -the consequential benefits of investment allowance under section 32-A of the Income Tax Act, 1961, the same also would become referable on the extension of logic with regard to question No. 1.

As regards question No.3, we find from the order of this Court in CIT v. Srivilas Cashew Co. (1993) 199 ITR 686 that this Court has thought of granting a certificate of fitness under section 261 of the Income-tax Act, 1961, with regard to the view taken by it and which is now pending in the Supreme Court, and to the effect that in order to get the benefit of weighted deduction, it is not necessary that the agent of the assessee outside India should act exclusively for the assessee. We also find that there is a divergence of views in regard to the situation. It is for this reason that we feel that a direction would be necessary also as regards question No. 3.

Accordingly, the Income-tax Appellate Tribunal, Cochin. Bench, Ernakulam, is directed to refer all the three questions to act in accordance with the provisions of section 256(2) of the Income Tax Act, 1961.

A copy of this judgment under the seal of this Court the signature of the Registrar shall be sent to the Income-tax Appellate Tribunal, Cochin Bench, Ernakulam, for passing consequential orders.

M.B.A./1296/FC Order accordingly