1. Through this application filed under section 256(2) of the Income-tax Act, the Commissioner of Income-tax seeks a direction to the Income-tax Appellate Tribunal to refer the following two questions to the High Court:
“1. Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding that the expenditure incurred by the assessee for purchasing dinner sets for distribution among selected purchasers was not for advertisement, publicity or sales promotion and, therefore, rule 6B has no role to play and the same was allowable expenditure?
2. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that interest paid by the assessee-firm on the deposits of a sister concern was allowable expenditure especially when the deposit was out of funds transferred to the sister concern by the partners?”
2. On the first question, the finding recorded by the Tribunal was that the assessee incurred expenditure in distribution of the articles intended for its purchasers, depending on their performance and in the opinion of the Tribunal and rightly so, the amount spent was neither an amount spent in publicity nor for advertisement.
3. This amount was spent under an incentive scheme and, therefore, rule 6B did not apply. In our view, no different view was possible in the circumstances of the case.
4. So far as the second question is concerned, this question is concluded by finding of fact against the Department.
5. The reference application is rejected.