AJIT K. SENGUPTA, J.

( 1 ) IN this reference made at the instance of the Revenue, the following questions have been referred by the Tribunal for the opinion of this court under Section 256 (1) of the Income-tax Act, 1961:"1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that any expenditure incurred in the course of the assessee's business has to be treated as business expenditure and merits deduction ignoring the provisions of Section 37 (1) of the Income-tax Act, 1961, which provides that any business expenditure of capital nature is not allowable as a deduction"

( 2 ) WHETHER, on the facts and in the circumstances of the case and in view of the ratio of the decision of the Calcutta High Court in Chloride India Ltd. v. CIT [1981] 130 ITR 61, the Tribunal was justified in law in holding that the expenditure of Rs. 6,96,288 incurred for acquiring a right to vacant possession is an allowable business expenditure ?" 2. The facts as found by the Tribunal are as under : this reference relates to the income-tax assessment of the assessee-company for the previous year ending January 31, 1983, corresponding to the assessment year

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