( 1 ) THE facts found and/or admitted in these proceedings are shortly as follows : bestobell (India) Ltd. , Calcutta, is the Indian subsidiary of M/s. Bells' Asbestos and Engineering (Holdings) Ltd. , a non-resident company incorporated in the United Kingdom. At the material period the assesses was engaged in executing a contract awarded by Barauni Oil Refinery, a Government of India undertaking. In executing the said contract the funds of the assessee to the extent of over Rs. 24 lakhs became blocked. In the circumstances, the assessee approached its parent company for a loan of 37,500 being about Rs. 5 lakhs in Indian currency at that time. The foreign principal company agreed to advance the amount to the assessee and in its letter dated the 14th January, 1965, wrote to the assessee as follows :"with reference to your application for financial assistance, we conefirm that this company would agree to make you an interest-free loan of Rs. 5 lakhs ( 37,500) for a period of one" year, to enable you to finance the large Government contracts on which you are currently engaged. No doubt you will obtain the necessary permission from the Indian Government to repay th