M.R.Sharma, J.

1. The assessee is a registered firm deriving income from the manufacture and sale of shoddy yarn. It agreed to purchase one woollen card, one woollen ring spinning frame and one willow machine with spares from a Japanese company. The payment was to be made in foreign currency and on instalment basis. For the assessment year 1969-70, the assessee claimed development rebate on a sum of Rs. 9,89,017 spent towards the price of the machinery acquired during the relevant accounting period. The ITO while framing the assessment deducted a sum of Rs. 2,63,688 from this amount representing the cost of the machinery on account of devaluation and allowed the rebate on a sum of Rs. 7,25,329 only. The plea raised by the assessee that under Section 43A(2) of the I.T. Act, 1961 (hereinafter referred to as "the Act"), the increase in price on account of devaluation should be taken into consideration for development rebate, was negatived by the ITO and the AAC. It, however, prevailed with the Income-tax Appellate Tribunal, Amritsar Bench (hereinafter referred to as "the Tribunal"), which gave the assessee the necessary relief.

2. At the instance of the revenue, the following