Per Shri Ch. G. Krishnamurthy, Senior Vice-President - These are two cross-appeals relating to the Haryana Co-op. Sugar Mills Ltd., Rohtak arising out of income-tax assessment made for the assessment year 1977-78. For the sake of convenience these appeals are consolidated for disposal by a common order.

2. The first ground in the assessee’s appeal relates to the disallowance of a sum of Rs. 2 lakhs out of a total sum of Rs. 3.5 lakhs incurred by the assessee in widening and conversion of a kutcha circular road into a pucca road. The assessee as its name implies is a co-operative sugar factory situated at Rohtak. The assessee’s factory is in a place near Hissar connected by two kutcha roads. One kutcha road leads to Hissar and another kutcha road leads to Jhajjar. From the site plan showing the location of the mills given at page 17 of the paper book, it will be clear that the assessee’s mills were situated in between these two roads. As these roads leading to the assessee’s mills premises were kutcha roads, on account of the load of the sugarcane carts, the roads got further damaged. They were also very narrow. This condition of the road led to bottlenecks in the transport of s