Law: Income Tax Act, 1961

Section: 256(1),144B,35B,143(3),153(3)

(a) Income-tax--- ----Assessment---Draft assessment order---Law applicable to assessment--­Section 144-B applicable to assessment year 1975-76---Indian Income Tax Act, 1961, S. 144-B. Section 144-B of the Indian Income Tax Act, 1961, has an overriding effect over all other provisions contained in the Act. It starts with the non obstante clause "notwithstanding anything contained in this Act". It mandates the Income-tax Officer to follow the procedure laid down therein in all cases where in an assessment to be made under subsection (3) of section 143, he proposes to make any variation in the income or loss returned which is prejudicial to the assessee and such amount exceeds the amount fixed by the Central Board of Direct Taxes. From the phraseology of this section it is clear that on or after the coming into force of this section, it was incumbent on the part of the Income-tax Officer to comply with the requirements of this section in all assessments to be made thereafter under subsection (3) of section 143 of the Act if the variation in the returned income exceeded the specified figure. Its applicability is not related to assessment year. It applies to assessments to be made after the coming into force of this section i.e., January 1, 1976. (b) Income-tax--- ----Export markets development allowance---Weighted deduction---Export inspection fees, trade discount on sales, interest paid to State Trading Corporation of India, freight and forwarding charges for export of goods, consular fees paid to consulate and wages to export godown workers---Not entitled to weighted deduction---Indian Income Tax Act, 1961, S. 35-B. The expenditure incurred by the assessee by way of export inspection fees, trade discount on sales, interest paid to the State Trading Corporation of India and freight and forwarding charges for export of goods, consular fee paid to the consulate and wages to export godown workers do not qualified fees top weighted deduction under section 35-B: Daryani (M- H.) v. CIT (1993) 202 ITR 731 (Bon.) fol. (c) Income-tax--- Business expenditure---Incremental liability not provided for in accounts---Not deductible. Claim for deduction of the incremental…

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