A.K.SARKAR, J.

(1) THIS case does not seem to us to present any real difficulty. It arises out of a reference to the High Court of Patna of two questions both of which were answered by the High Court against the assessee, the appellant in this Court.

(2) THE appellant is a company manufacturing sugar. It had its factory originally at a place called Sitalpur. That place was found to be disadvantageous for the appellants business as sugar cane of good quality was not available in sufficient quantity in the neighbourhood and also as it suffered from ravages of flood. With a view to improve its business the appellant removed its factory from Sitalpur to another place called Garaul and in the process of dismantling the building and machinery, transportation from Sitalpur to Garaul and refitting the machinery at the latter place, it incurred a total expense of Rs. 3,19,766.00 in the year of account. In the assessment of its income-tax, it claimed a deduction of these expenses as revenue expenses. That claim was rejected. The questions referred concern these expenses.

(3) THE first question was this : "Whether the expenditure of Rs. 3,19,766.00 incurr