S. RAJENDRA BABU, J.

( 1 ) THE petitioner entered into an agreement with the Federal Military Government of the Federal Republic of Nigeria and applied for grant of approval and deductions as contemplated u/s 80-0 of the income-tax Act, 1961 (hereinafter referred to as the Act) to the 1st respondent. The agreement consisted of various types of passing of technical information, knowhow, designs, trade mark, logo and also training of Nigerian personnel in India among other matters. Article 15,1 of the agreement speaks about the payment of royalty which is at the rate of 2 percent of value added for seven years in respect of the right granted to the Nigerian Government for exclusive use in that country and other ECOWAS (Economic Community of west African States) countries as provided in Articles 4. 1 and 4. 1. 1. The first respondent took the view that the same is a trade restriction on the petitioner and the consideration in respect of that restriction is outside the scope of Section 80-0 of the act and, therefore, declined to grant approval so as to entitle them for deduction u/s 80-0 of the Act. On the question of training Nigerian personnel in India as provided in Article 4. 1 read

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