AJIT K. SENGUPTA, J. ( 1 ) IN this reference under Section 256 (1) of the Income-tax Act, 1961, for the assessment year 1976-77, the following question of law has been referred to this court :"whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in holding that the amount of Rs. 75,494 qualifies for deduction under Section 35b of the Income-tax Act, 1961. " ( 2 ) THE assessee claimed export markets development allowance in respect of expenditure of Rs. 8,16,274. According to the Income-tax Officer, these expenses included shipping expenses, bank commission, administrative expenses, salary, postage, etc. He held that except the expenditure of Rs. 1,30,500 incurred on account of foreign travelling, the assessee was not entitled to the allowance under Section 35b. ( 3 ) AGAINST the Income-tax Officer's decision, the assessee preferred an appeal to the Commissioner of Income-tax (Appeals ). Following the Special Bench order of the Tribunal on this issue, he held :"the first item of Rs. 97,942 relating to analysis, weighment, supervision charges, etc. , will be clearly inadmissible. Bank commission relating to the discounting of bills is connected with the early realisation of the price of the goods exported and it does not fall within the admissibility of the clause which disqualifies the amount of Rs. 51,963 for weighted deduction. The amount of Rs. 18,204 relates to Export Credit Guarantee Corporation for their service and will be covered by Sub-clause (ii) and hence includible in the computation for weighted deduction. The amounts of Rs. 3,51,299 and Rs. 58,776 relate to carriage, handling, clearing and forwarding charges which have to come under the specific exclusion by Sub-clause (iii) as elaborately discussed above. These two amounts, therefore, lose the claim for weighted deduction. Similar will be the fate of the amount of Rs. 3,290 relating to port expenses. The amount of Rs. 32,750 has been explained as premium paid on purchase of export quota. It is actually the cost of goods and not an expenditure covered by Section 35b. This will also not enter into the computation under Section 35b. As discussed above, the salary of the staff dealing with export matters has to be allowed on the basis of apportionment. In this regard, in my view, Rs. 40,000 out of the claim of Rs. 54,259, i. e. , about 75 per cent. This will also not enter into the computation under Section 35b. As discussed above, the salary of the staff dealing with export matters has to be allowed on the basis of apportionment. In this regard, in my view, Rs. 40,000 out of the claim of Rs. 54,259, i. e. , about 75 per cent. , should be taken into the computation for allowing weighted deduction. Foreign expenses of Rs. 1,30,500 have already been included by the Income-tax Officer for weighted deduction. The appellant states that the specific items of expenditure on postage, telephone and trunkcall relate to export business and foreign markets which come to Rs. 16,510. Since this apportionment itself has been specifically given from the total expenditure relating thereto which was before the Income-tax Officer right from the assessment stage, this amount of Rs. 16,510 will be included for purposes of weighted deduction. The last item of Rs. 780 relates to foreign periodicals which are subscribed to by the appellant. The amount of Rs. 780 will also be included for weighted deduction. The Income-tax Officer will please revise the calculation of weighted deduction under Section 35b in the light of the above directions in this order. Consequential relief will be available to the appellant. " ( 4 ) ON second appeal, the Tribunal held thus :"we have heard both sides on the issue. The items of expenditure in respect of which the assessee became dissatisfied with the order of the Commissioner of Income-tax (Appeals) have been enumerated hereinabove. The Revenue felt aggrieved with the items, namely, Rs. 18,204 being the fees paid to the Export Credit Guarantee Corporation, salary of Export Department, (sic) Rs. 16,510 being postage, telephone and trunk-call expenditure related to export business and Rs. 780 related to foreign periodicals. In view of the undisputed fact that the Commissioner of Income-tax (Appeals) followed the order of the Special Bench of the Appellate Tribunal, Bombay, and since we agree with him in this regard, his decision with reference to Section 35b of the Act in respect of the items of expenditure disputed before us from both sides is upheld. " ( 5 ) THE contention of Mr. " ( 5 ) THE contention of Mr. Bajoria is that since the Special Bench judgment of the Bombay Tribunal has been accepted by the Board, there is, therefore, no reason why the expenditure which has been allowed proportionately on the basis of the formula evolved by the Special Bench should not be sustained. It is also contended that most of the items are allowable in view of the decisions of several High Courts. We have already indicated the break-up of the claim made. The first amount of Rs. 18,204 relates to payment for services rendered by the Export Credit Guarantee Corporation. The Karnataka High Court, in CIT v. J. B. Advani and Co. (Mysore) (Pvt.) Ltd. [1987] 163 ITR 638, has held that the premium paid to the Export Credit Guarantee Corporation was incurred for obtaining information regarding the creditworthiness, reputation and fixing the limits of its buyers and the expenditure qualified for weighted deduction under Section 35b (1) (b ). ( 6 ) THE Andhra Pradesh High Court, in CIT v. Navabharat Enterprises (P.) Ltd. (No. 1) [1988] 170 ITR 326, has held that the expenditure claimed by the assessee for payment to the Export Credit Guarantee Corporation is for being apprised of the creditworthiness of the foreign buyer and for providing guarantee for the payment. Such payment is to ensure the financial capacity of the foreign buyer to fulfil the commitment of deferred payment and insulate the assessee against the risk of non-recovery from the foreign buyer. Accordingly, it is allowable under Section 35b (1) (b ). ( 7 ) WE respectfully agree with the views expressed by the Karnataka -and Andhra Pradesh High Courts and hold that the fees paid to the Export Credit Guarantee Corporation for services rendered by them in connection with export business will be eligible for weighted deduction under Section 35b. ( 8 ) ONE other item relates to expenditure being 75 per cent. of the salary of the staff of the Export Department amounting to Rs. 40,000. This was allowed on the basis of the decision of the Special Bench of the Tribunal. The decision of the Special Bench has been accepted by the Board. This fact will appear from the decision in CIT v. Novelty Trading Corporation [1984] 150 ITR 453. of the salary of the staff of the Export Department amounting to Rs. 40,000. This was allowed on the basis of the decision of the Special Bench of the Tribunal. The decision of the Special Bench has been accepted by the Board. This fact will appear from the decision in CIT v. Novelty Trading Corporation [1984] 150 ITR 453. There, the Allahabad High Court held as follows (at pages 453, 454) :"in this group of cases, the assessees are engaged in export business. The dispute is in regard to the assessees' claim for weighted deduction in respect of salary and other expenses under Section 35b of the Income-tax Act, 1961. So far as salary expenses are concerned, for the purposes of Section 35b of the Act, the claim has been accepted by the Income-tax Appellate Tribunal to the extent of 75 per cent. This has been done following the decision of the Special Bench of the Tribunal in the case of J. Hemchand and Co. v. Second ITO, B-Ward, Bombay (I. T. A. No. 3255 of 1976-77), dated June 17, 1978. A counter-affidavit has been filed on behalf of the respondent-assessee in I. T. A. No. 163 of 1981, in which it has been stated that the Central Board of Direct Taxes has accepted the correctness of the decision of the Special Bench of the Appellate Tribunal in the case of J. Hemchand and Co. v. Second ITO (I. T. A. No. 3255 of 1976-77) and further that several Commissioners of Income-tax have issued instructions that reference applications under Section 256 (1) or Section 256 (2) need not be filed or, if filed, need not be pressed to challenge the correctness of the law laid down by the Special Bench of the Appellate Tribunal in the aforesaid case. Learned counsel for the Department produced before us that circular. We find that the Central Board of Direct Taxes has, by its circular dated December 28, 1981, accepted the decision in so far as the question of allowability of weighted deduction under Section 35b of the Act is concerned. It has, however, not accepted the apportionment of the claim at 75 per cent. We find that the Central Board of Direct Taxes has, by its circular dated December 28, 1981, accepted the decision in so far as the question of allowability of weighted deduction under Section 35b of the Act is concerned. It has, however, not accepted the apportionment of the claim at 75 per cent. It is none the less conscious of the fact that this issue would be basically a finding of fact and it can be further contested, depending on the stakes of the Revenue involved, by seeking reference to the High Court by raising an appropriate question of law on the ground of perversity. " ( 9 ) IN this case also, we find that the Revenue has not disputed the allowability of the claim of weighted deduction in respect of salary expenses attributable to export business. It has only disputed the quantum which is basically a question of fact. We are, therefore, of the view that the Tribunal was justified in affirming the decision of the Commissioner of Income-tax (Appeals) restricting the allowances of salary of the Export Department to 75 per cent. of the claim. ( 10 ) THE sum of Rs. 16,510 incurred by the assessee being the postage, telephone and trunk-call expenses, admittedly related to export business. These expenses were concerned with the correspondence and communication with foreign buyers and work directly connected with exports and, accordingly, this amount was rightly allowed by the Tribunal. ( 11 ) THE other item relates to the expenditure of Rs. 780 for purchase of foreign periodicals. The assesses has to obtain information regarding the foreign markets from foreign trade journals and it cannot be said that such expenses do not relate to export promotion. As a matter of fact, in 1981, Rule 6aa was inserted in the Income-tax Rules, 1962, prescribing the activities for export markets development allowance under Sub-clause (ix) of Clause (b) of Sub-section (1) of Section 35b. One of the activities for promotion of sales would be purchase of foreign periodicals or journals relating to the export business of the assessee. Having regard to the facts and circumstances of this case, we are of the view that such expenditure is allowable under Section 35b which facilitates the carrying on of the export business. One of the activities for promotion of sales would be purchase of foreign periodicals or journals relating to the export business of the assessee. Having regard to the facts and circumstances of this case, we are of the view that such expenditure is allowable under Section 35b which facilitates the carrying on of the export business. ( 12 ) FOR the foregoing reasons, we answer the question in this reference in the affirmative and in favour of the assessee. There will be no order as to costs.