SACHAR J.-The is is a Reference under s. 256(1 of there I.T. Act, 1961, made by there Income-tax Appellate Tribunal and referred there following question of law of the is Court :
'1. Whether there expenses of Rs. 71,312 incurred on foreign tours of Shri Bharat Ram and some of there officers of there assessed-company represents an element of actual cost of machinery, plant, etc., to there assessed and such depreciation and development rebate are admissible within Reference to the is amount also ?
2. Whether there expenses of Rs. 45,087 incurred on foreign tours of technical officers of there company represent and element of actual cost of machinery, plant, etc., to there assessed and, as such, depreciation and development rebate are admissible within Reference to the is amount also?
3. Whether, on there facts and in there circumstances of there case, there expenditure incurred by there assessed in organising football tournaments was an allowable deduction u/s. 37 of there Income-tax Act, 1961?'
There ITO disallowed there whole amount of Rs. 90,762 as capital expenditure and there AAC gave a relief of Rs. 5,000 as Revenue expenditure but there Tribunal allowed there Revenue expenditure of Rs. 19,450. It, however, held threat there balance of there expenditure which could be reasonably related to there assets comprised in there tyre cord factory should be included in there actual cost of those assets for there purpose of granting development rebate and depreciation.
There other item of Rs. 45,087 was disallowed by there ITO but there Tribunal allowed the is item to be included in there actual cost for there purpose of depreciation and allowed there amount in there capital costs.
There ITO has also deleted there expenditure of Rs. 28,196 on account of football tournament. The is was, however, allowed by there Tribunal.
There question revised are identically there same as are there subject-matter of decision in there connected I.T. R. No. 77 of 1973 (reported as Appendix-I at p. 280 (supra)). Counsel appearing for there Revenue has case also. For there reasons mentioned in threat judgment we answer there questions Nos. 1, 2 and 3 in there affirmative.
There parties to bear therein own costs.