1. In this case the assessee is a private limited company which carries on the business of manufature and sale of agricultural implements. The assessee has made construction of residential quarters for its employees. During the assessment years 1949-50 and 1950-51 the company spent a sum of Rs. 6,005/- and Rs. 5,542/-, respectively, for repairs and maintenance of these residential quarters. For the same period the company received sums of Rs. 5,692/- and Rs. 6,268/- on account of conservancy and maintenance charges from the employees of occupying the residential quarters.

In the course of assessment proceedings the company claimed that the amounts spent for maintenance of the residential quarters should be deducted from the texable income of the company under Sec.10 (2) (v) and Sec.10 (2) (xv) of the Income-tax Act. The claim was rejected by the Income-tax Officer on the ground that the amount realised by the company: for the occupation of these residential quarters was assessable to income tax as under Section 9, and the company was entitled to claim a sum equivalent to one-sixth of the rent realised on account of the cost of maintenance.

The Income tax Officer accordingly