Ajit K.Sengupta, J.

1. IN this reference made at the instance of the Revenue, the following question has been referred by the Tribunal for the opinion of this court under Section 256(1) of the Income-tax Act, 1961 :

"Whether, on the facts and in the circumstances of the case and on a correct interpretation of Sections 37(3A) and 37(3B) of the Income-tax Act, 1961, the Tribunal was justified in law in holding that the expenses incurred on special discount and foreign tour expenses are not hit by the said Sections 37(3A) and 37(3B) of the said Act and thereby directing to delete the consequential addition made in the assessment ?"

2. THE assessee is engaged in carrying on the business of dealers of Beltek T.Vs. This reference relates to the income-tax assessment of the assessee for the assessment year 1984-85. In the course of the assessment proceedings, the Assessing Officer found that the assessee incurred an expenditure of Rs. 2,16,025 debited under the head "Special discount" and another sum of Rs. 1,65,236 debited under the head "Foreign tour expenses". THE Assessing Officer noticed that the assessee in terms of its Circular No. 26 of 1983 dated January 10, 1983, introduce