1. This appeal has been filed by the department against the order dated 23-3-1981 of the Commissioner (Appeals), relating to the assessment year 1976-77, the previous year of which ended on 31-3-1976. The grounds taken in this appeal are as below : 7. The learned Commissioner (Appeals) erred in holding that on the facts and in the circumstances of the case and in law the assessee being a professional is engaged in business and that the assessee is eligible for weighted deduction under Section 35B. 2. He further erred in accepting the alternative claim of the assessee that the foreign tour income should be treated as business income and not income from profession and hence entitled to deduction under Section 35B.2. The assessee is an eminent playback singer in the Film Industry.
During the year under consideration, she had been to the USA to give public performances at nine places, in accordance with an agreement dated 11-3-1975 with Image of India, who acted as the agent of the assessee in organising the foreign tour. The tour was conducted on commercial lines, inasmuch as the assessee took the group of artists and other technicians with her and tickets were sold for all the performances. Foreign taxes were paid, profit and loss account was drawn up. The assessee offered the net profit arising out of the tour for tax. In course of the assessment proceedings, the assessee claimed that the expenses incurred by her in earning the aforesaid foreign income should be allowed as deduction. The ITO agreed and allowed the same as deduction and taxed only the net balance. Another claim of the assessee before the ITO was that weighted deduction under Section 35B of the Income-tax Act, 1961 ('the Act') should be allowed on expenses incurred abroad and which fell within various clauses of Section 35B.The ITO rejected the claim of the assessee on the ground that the assessee was engaged in a profession and not in a business and so the assessee was not entitled to the relief under Section 35B. According to the ITO, there should be goods or services or facilities which are capable of being transferred ; otherwise Section 35B does not apply. In the instant case, the ITO held that the assessee had certain personal accomplishments which made her an outstanding playback singer, but those personal accomplishments could not be transferred by her to any other person outside India. In this view of the matter, be held that the provisions of Section 35B did not apply to the facts of the case.
Hence, the ITO assessed the foreign income of the assessee under the head 'Income from other sources' and denied the relief under Section 35B on the expenses incurred by her to earn that income.
3. The assessee appealed to the Commissioner (Appeals), and contended that the action of the ITO was not justified. Reliance was placed on the decision of the Tribunal in Dr. R.H. Dastur v. Third ITO  8 Taxman 165 (Bom.), wherein it has been held that a doctor going abroad to render professional services, actually carries on business and the income so earned by him from abroad is assessable under the head 'Profits and gains of business or profession', and further that the expenses incurred by him qualifies for relief under Section 35B.Reliance was also placed on the decision of the Tribunal in another case, IT Appeal No. 3117 [Bom.] 1979 dated 29-11-1980, wherein it has been held that Section 35B applied even to a chartered accountant, who renders his services abroad. The departmental view that a chartered accountant derives income from profession and so is not entitled to relief under Section 35B has been reversed in this order. The Commissioner (Appeals), following the aforesaid orders of the Tribunal, held that the foreign income of the assessee before us is assessable under the head 'Profits and gains of business or profession', and so the relief under Section 35B on the expenditure incurred to earn that income cannot be denied merely on the ground that the assessee was carrying on a profession and not a business. The Commissioner (Appeals) then considered whether the individual items of expenses, satisfied the tests laid down in the various sub-clauses of Section 35B. He found that the various items, totalling to Rs. 23,19,505 and another sum of Rs 54,000 satisfied all the conditions for the grant of relief under Section 35B and so he directed that relief under Section 35B thereon, should be given. Similarly, he found that another sum of Rs. 44,682 also qualified for relief under Section 35B, and so he directed the ITO to allow the relief thereon.
4. Shri D.R. Chawla, the learned representative for the department, urged before us that the learned Commissioner (Appeals) erred in his decision. At the outset, he fairly stated that the question whether 'profession' is included in the term 'business' or not has been settled by the Supreme Court in the case of Barendra Prasad Ray v. ITO  129 ITR 295. He stated that the Supreme Court has held that all professions are included in the term 'business' and so it is not possible to deny the relief under Section 35B to the assessee, on the ground that she was engaged in a profession, but not in a business.
However, he argued that the Commissioner (Appeals) went wrong in saying that the provisions of Section 35B applied to the facts of the case, even assuming that the assessee's income was assessable under the head 'Profits and gains of business or profession', according to Shri D.R.Chawla, the assessee did not export anything at all, because in order to constitute export, there should be some goods or services which can be parted with by the assessee and received by somebody else. According to him, the assessee should have produced some goods or services which are capable of being transferred to another person, and if that were not possible, there would be no export at all. He laid stress on the dictionary meaning of the words 'deals in' and 'provides' appearing in Section 35B(1)(b)(i), for the proposition that the assessee in the instant case did not produce any goods or services or facilities which she carried with her and parted with the same abroad, by transferring them to some other persons. Further, he urged that even assuming that the assessee was eligible for relief under Section 35B, the Commissioner (Appeals) should have given the ITO a chance to examine whether the conditions laid down in Section 35B are satisfied in respect of the expenditure on which he has granted relief.
5. Shri H.S. Khurana, the learned representative for the assessee, on the other hand, supported the order of the Commissioner (Appeals). He strongly relied on the two decisions of the Tribunal referred to in his order. He took us through those orders and explained that the question which arose in those cases was similar, namely, whether a person rendering professional services abroad is entitled to relief under Section 35B, in respect of the expenses incurred in earning the foreign income. He pointed out that in both the cases, the conclusion of the Tribunal was that the assessee was entitled to relief under Section 35B though the eases proceeded on the basis as to whether the foreign income could be assessed under the head 'Profits and gains of profession or business. Further he pointed out that there was regular agency agreement between the assessee and the foreign agent, namely, Image of India, under which the assessee was obliged to reimburse all the expenses incurred by the agent, and also to remunerate the agent @ 40 per cent of the net surplus. His point was that unless the assessee proceeded abroad and performed her part of the contract, she would have been exposed to claim for damage for breach of contract. Consequently, the expenses under consideration were actually incurred by the assessee in the process of the execution of a contract outside India. Then he pointed out that the learned Commissioner (Appeals) had examined the expenditure item by item and has clearly stated the particular sub-clause of Section 35B(1)(b) under which the relief is admissible.
He stated that the said finding of the Commissioner (Appeals) has not been challenged in this appeal, nor is there any specific ground taken to the effect that the Commissioner (Appeals) entertained any new evidence without giving the ITO a chance to have his say on the same.
Further, Shri Khurana stated that the meaning of 'export' is quite clear, namely, goods or services must be sold abroad and it was not necessary that certain goods or services must be capable of being physically transferred. He stated that the very idea of transfer is alien to trading in service. In other words, a professional person cannot physically transfer his services to another man, in the sense a trader of tangible goods does. Nevertheless, he explained, a professional person does render service to a customer and receives payment from the customer for the services rendered. In the sense, he stated that there was a sale of the services or transfer of services in consideration for a price, as otherwise nobody would have paid any amount to the assessee. Again, he stated that it is not necessary that there should be actual exports in order to be entitled to the relief under Section 35B ; it is enough if the expenses were incurred for the various purposes laid down in Section 35B(1)(b), which are all intended to develop the export market.
6. We have considered the contentions of both the parties as well as the facts on record. In our opinion, this appeal cannot succeed. We are not impressed by the argument raised for the revenue that the assessee before us did not export any services merely because intangible services could not be physically transferred. If the arguments of the department were accepted as correct, then the reference to services and facilities in Section 35B would become redundant. 'Export' means to carry or sent goods beyond the national boundary, i.e., to a foreign country-Chambers Twentieth Century Dictionary. In the case before us, the assessee has definitely sold her professional services which were bought by customers abroad. Otherwise, the assessee would not have got any money at all. The foreign tour was conducted on commercial lines and the income therefrom is definitely assessable under the head 'Profits and gains of business or profession' as has been held by the Supreme Court in the case of Barendra Prasad (supra). Export can be made either by manufacturing the goods in India and then sending the same, or taking the source of goods or services abroad and producing the service and selling them on the spot in the foreign country. In the very nature of things, a professional goes abroad and exchanges his services for a price to foreign customers. It is true that the assessee could have tape recorded her talents which could have been sold abroad, but in that case it would have been a case of export of tangible goods in the form of the tapes, and it would not have been a case of export of services. What the assessee exported was her live musical performances in person. Considered from any angle, we have no doubt in our mind that the assessee carried on business, and that she did export services and so the Commissioner (Appeals) was quite correct in holding that the assessee was entitled to relief under Section 35B. We have gone through the order of the Commissioner (Appeals) and we find that she has considered in detail the various items of expenditure one by one, and has specifically stated against each item as to under which sub-clause relief is admissible. None of these findings have been shown before us to be erroneous. The Commissioner (Appeals) has not entertained any fresh evidence. We, therefore, do not see any force in the argument that the ITO was not given a fresh opportunity to examine the eligibility of the various items for relief under Section 35B. We find support for the above conclusion of ours from both the orders of the Tribunal cited earlier in this order. For the above reasons, we uphold the order of the Commissioner (Appeals).