Janarthanam, J. - In this tax case, the question that falls for consideration is reflected as below :

"Whether, on the facts and in the circumstances of the case and having regard to the provisions of section 43A(2) of the Income-tax Act, 1961, the Appellate Tribunal was correct in holding that the assessee is entitled to development rebate under section 33 of the Income-tax Act, 1961, on the increased cost of the machinery of Rs. 1,41,185 due to devaluation of Indian currency on June 6, 1966 ?"

2. The assessee is an Indian company dealing in the manufacture and sale of electronic instruments, relays, fusegears, etc. For the assessment year 1967-68, the assessee furnished a return declaring a loss of Rs. 11,92,468 and the assessment was, however, completed on a total income of Rs. 29,06,220.

The assessee purchased certain machinery from foreign parties in August, 1965 at a cost of Rs. 2,45,540 and installed it in his factory during October and November, 1965. The actual payment for this machinery was made only in August, 1966, and in between this there was devaluation of Indian currency on 6-6-1966.

3. As a result of devaluation, the assessee had to pay the increase in value of