S.S.Sandhawalia, J.

1. The following two questions have been referred by the Income-tax Appellate Tribunal (Delhi Bench "A") for the opinion of this court:

"(i) Whether the assessee-company was entitled to development rebate on the cost of mains, service-lines and switch gears ?

(ii) If the answer to the first question be in the affirmative then whether the development rebate was admissible to the company on the gross cost or on the net amount (gross expenditure less reimbursement) ?"

Learned counsel for the parties are both agreed that the answer to the first question is concluded by the decision of their Lordships of the Supreme Court in Commissioner of Income-tax v. Raju and Mannar, [1966] 60 I.T.R. 246 (S.C.). In accordance with that decision we return the answer to the first question in the affirmative and against the revenue.

2. It is, therefore, necessary to advert to matters relevant to the second question only. The assessee--The Ambala Cantt. Electric Supply Co. Ltd. --is a private limited company, carrying on the business of generation and distribution of electricity. The relevant assessment years are 1958-59 and 1959-60. During the years above-said there was expa