Judgement

SHAH, J. :- The Income-tax Appellate Tribunal referred two questions to the High Court of Judicature at Bombay under S. 66(1) of the Indian Income-tax Act, 1922:

"(1) Whether on the facts and in the circumstances of the case, the payment made by the assessee to Ciba Ltd., Basle, in pursuance of the agreement dated 17th December, 1947 is an admissible deduction under the "provisions of S. 10 (2) (xii) of the Income-tax Act, and if not, under S. 10 (2) (xv) of the Act, either in part or whole ?

(2) Whether on the facts and in the circumstances of the case, the payment made in accordance with the terms of the agreements dated 15th November, 1944 and 18th June, 1948 for meeting the expenses of suit No. 890 of 1946 is an allowable expense under S. 10 (2) (xv) of the Income-tax Act ?" In answer to the first question the High Court recorded that the payment made by the assessee to Ciba Ltd., Basle, in pursuance of the agreement dated December 17, 1947 is an admissible deduction under S. 10 (2)(xv) of the Income-tax Act, but not under S. 10 (2) (xii) of the Act. The second question was answered in the negative. Against the answer recorded on the first question the Commissioner of In