SABYASACHI MUKHARJI, J.

( 1 ) IN this reference under Section 256 (1) of the I. T Act, 1961, a combined statement of case has been filed by the Tribunal dealing with the assessee's application as well as the Revenue's application for reference. The assessment relates to the assessment year 1972-73. The assessee is a limited company which is mainly engaged in the business of export sales of leaf tobacco purchased and cured in India. For the relevant assessment year, among the claims made by the assessee were, that the profit on exchange amounting to Rs. 1,40,329 was not liable to tax, the weighted deduction on account of agricultural development allowance should be allowed on the entire expenses claimed amounting to Rs. 18,20,670, which included depreciation of Rs. 64,732 and scientific research expenses in the field of agriculture amounting to Rs. 81,847. It was also claimed that the expenses on account of ex gratia payments to widows or dependants of the deceased employees as well as expenses on reimbursement of the medical expenses to the employees should be allowed as a deduction in working out the business income. The ITO, however, while allowing the weighted deduction on agri

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