JUDGMENT

Mohd. Azmi J:

This is an appeal by way of case stated against the decision of the Special Commissioners of Income Tax in holding that, in the ascertainment of the taxpayer company's income for the year of assessment 1971, the sum of RM247,838 paid by way of retrenchment benefits was not deductible under the provisions of s. 33(1) of the Income Tax Act 1967.

In accordance with the evidence and statement of agreed facts, the appellant taxpayer is a tin mining company which has gone into liquidation because of the exhaustion of its tin ore reserve. Mining operation ceased on 24 July 1970 and the company went into voluntary liquidation on 29 April 1971. (See AB19). Payments of retrenchment benefits were made to the various employees between July and November 1970 in accordance with the terms of two agreements between the Malayan Mining Employers' Association, of which the company was a member, and two trade unions representing the employees, entered into by the parties in 1967. The taxpayer company claims that for the assessment year 1971, it is entitled to deduct those 1970 payments from its gross income as being "outgoings and expenses wholly and exclusively incurred in the