Judgment :- R. JAYASIMHA BABU, J. The assessee, which is a Bank, maintained a branch at Bangkok. At that branch, it received deposits from its customers and paid interest to those depositors. The interest so paid during the asst. yr. 1981-82 aggregated to Rs. 99, 57, 721. The assessee claimed the benefit of weighted deduction in respect of the sum by placing reliance on s. 35B(1)(b)(iv) of the IT Act. Sec. 35B bears the heading, 'Export markets development allowance'. By sub-s. (1)(a), deduction is allowed to the assessee on a sum equal to one and one-third times the amount of expenditure incurred on the items specified in s. 35B(1)(b) of the Act. Sec. 35B(1)(b) of the Act as it stood prior to the amendments by Finance (No. 2) Act, 1980, contained ten clauses. Clause (i) of s. 35B(1)(b) referred to expenditure on advertisement or publicity outside India; cl. (ii) to expenditure on obtaining information regarding markets outside India; cl. (iii) to expenditure on distribution, supply or provision outside India excluding certain items of expenditure mentioned in that provision; cl. (iv) referred to expenditure on maintenance outside India of a branch, office or agency for promotion; cl. (v) referred to expenditure on preparation and submission of tenders and activities incidental thereto; cl. (vi) to expenditure of furnishing to a person outside India samples or technical information for the promotion of the sale of the goods, services or facilities dealt with by the assessee; cl. (vii) to expenditure of travelling outside India for the promotion of the sale outside India of the goods, services or facilities; cl. (viii) to performance of services outside India in connection with, or incidental to, the execution of any contract for the supply outside India of goods, services or facilities; and (ix) to expenditure on other activities for the promotion of the sale outside India of goods, services or facilities as may be prescribed. All the sub-clauses refer to the goods, services or facilities dealt with by the assessee in the normal course of its businessThe term "promotion" is used in cl. (iv), as also in cl. (ix). Advertisement and publicity outside India which in the normal course would be regarded as part of promotional activity is independently provided for in cl. (i). Distribution, supply or provision outside India of goods, services or facilities is separately provided for in cl. (iii). (iv), as also in cl. (ix). Advertisement and publicity outside India which in the normal course would be regarded as part of promotional activity is independently provided for in cl. (i). Distribution, supply or provision outside India of goods, services or facilities is separately provided for in cl. (iii). The scheme of s. 35(1)(b) of the Act thus discloses legislative intention of regarding the provision, supply or distribution of goods, services or facilities outside India, as being distinct from the promotion of the sale outside India of such goods, services or facilities. The scheme also indicates the legislative intent of making a distinction between maintenance outside India of a branch, office or agency for promotion, and other activities for the promotion of sale of goods services or facilities outside India. 'Other activities' are specifically referred to in cl. (ix). Sec. 35B(1)(b)(iv) which refers to, "maintenance outside India of a branch, office or agency for the promotion of the sale outside India of such goods, services or facilities" is meant to cover the expenditure incurred by the assessee on the maintenance of the branch, office or agency, if such branch, office or agency is maintained by the assessee outside India, and the purpose of maintaining such a branch, office or agency is the promotion of sale outside India of the goods, services or facilities, dealt with by the assessee. The expenditure incurred on promotion as such does not fall within cl. (iv), unless such expenditure is capable of being regarded as part of the expenditure incurred on maintenance of the branch, office or agency. The fact that expenditure on advertisement or publicity outside India is specifically provided for in cl. (i) would also indicate that the legislative intent was not to allow expenditure on promotion under cl. (iv). The provision in cl. (ix) for expenditure on other activities for promotion would also indicate that the expenditure incurred on promotion as such is not meant to be covered by cl. (iv)By the Finance (No. 2) Act of 1980, cls. (ii), (iii), (v), (vi) and (viii) were deleted. (iv). The provision in cl. (ix) for expenditure on other activities for promotion would also indicate that the expenditure incurred on promotion as such is not meant to be covered by cl. (iv)By the Finance (No. 2) Act of 1980, cls. (ii), (iii), (v), (vi) and (viii) were deleted. The deletion of those clauses clearly indicates the legislative intention to discontinue the allowance that had been provided for under those clauses viz., expenditure incurred on distribution, supply or provision outside India of the goods, services or facilities dealt with by the assessee, the expenditure on preparation and submission of tenders for the supply or provision outside India on goods, services or facilities and activities incidental thereto, expenditure on furnishing to a person outside India, samples of technical information for the promotion of the sale of such goods, services or facilities; and expenditure incurred by the assessee on the performance of services outside India in connection with or incidental to the execution of any contract for the supply outside India of such goods, services or facilities. Amounts which were being claimed as deduction under cls. (ii), (iii), (v), (vi) and (vii) can no longer be claimed after the amendment. The expenditure incurred by the assessee here by way of payment of interest to the customers, who had made deposits with its branch at Bangkok was being allowed in earlier years under s. 35B(1)(b)(iii) of the Act, as it covered the expenditure on the provision of services or facilities outside India by the assessee. The assessee's attempt in the year 1981-82 to claim weighted deduction for that expenditure even after the deletion of sub-cl. (iii) of s. 35B(1)(b) succeeded before the Tribunal, though it had initially been rejected by the ITO, as also by the CIT(A) in appeal. The Tribunal took the view that the amount claimed was allowable, as the assessee was required to raise resources outside India, and was to maintain the bank from out of the amounts so raised outside India by way of borrowing. The Tribunal took the view that the amount claimed was allowable, as the assessee was required to raise resources outside India, and was to maintain the bank from out of the amounts so raised outside India by way of borrowing. It characterized the deposits made by the bank's customers as amounts borrowed by the bank, and the interest paid to those customers was regarded by it as expenditure incurred by the assessee on the promotion of its services outside India, as also as being part of the expenditure on maintenance outside India of it's branchThe Tribunal, in our view, has misconceived the scope of s. 35B(1)(b)(iv) of the Act. That provision, as pointed out by us earlier, is not meant to cover the cost of provision of services outside India for which an independent clause existed in cl. (iii) till its deletion w.e.f. 1st April, 1981. All that s. 35B(1)(b)(iv) of the Act provides for is the expenditure incurred by the assessee on maintenance of the branch, office or agency outside India, provided such branch, office or agency is established, run or constituted for the promotion of the sale outside India of the goods, services and facilities by the assessee. The interest paid to the depositors by the bank to its customers at its branch outside India can by no means be regarded as constituting part of the expenditure on the maintenance of the branch. A branch which merely carries on business in the normal course cannot also be regarded as a branch established for the promotion of the sale outside India of goods, services or facilities. Even if it is assumed that some of the activities of the branch outside India dealt with the promotion of its services and facilities, as distinct from the provision of such facilities to all those willing to avail of it, the assessee could at best claim the cost of maintaining the branch. Maintenance here would only cover such items of expenditure on obtaining the space in which the branch is maintained, the cost of maintenance of the office in terms of maintaining the physical facilities, salary required to be paid to it's employees, and things incidental to such items of expenditure. Maintenance here would only cover such items of expenditure on obtaining the space in which the branch is maintained, the cost of maintenance of the office in terms of maintaining the physical facilities, salary required to be paid to it's employees, and things incidental to such items of expenditure. The assessee's claim was not for any such expenditure, but for the interest that it had paid to its customers who in the normal course had availed the banking facilities of the assessee-bank. Such expenditure could only come under cl. (iii) which was unavailable to the assessee in the asst. yr. 1981-82, as that clause was deleted w.e.f. 1st April, 1981There is a clear distinction in the scheme of the section as between promotion and provision of services and facilities. Even though if a very broad view were to be taken of the term "promotion", it may include to some extent the provision of services, the term "promotion" cannot be a substitute for 'provision' or vice versa. Whenever service is provided, to some extent, there is an element of promotion insofar as the person who receive the service may by reason of the quality of the service received may be willing to avail of such service again in the future, and the possibility of his appreciation for the service conveyed by him to other potential customers resulting in increased business for the assessee. But, any such promotional benefit would only be incidental. Similarly, for promoting the services, it may be necessary to demonstrate the quality of the service by actually providing it. But, the provision of the service in that context would only be incidental to the primary object of promotion. Carrying on the normal business of a bank by providing banking facilities to customers cannot be regarded as promotional activity by the bank, for the purposes of s. 35B(1)(b)(iv) of the Act. Even if a liberal view is taken of the term "promotion", all that the assessee can claim is the cost of maintaining the branch on the ground that such branch is maintained for the promotion of the services and facilities provided by it. In this context, it is necessary to refer to the observation of the Supreme Court in the case of Aravinda Paramila Works vs. CIT. In this context, it is necessary to refer to the observation of the Supreme Court in the case of Aravinda Paramila Works vs. CIT. The Court therein dealt with the differing views of the High Courts in the country on the scope of this provision, and after analysing the provision stated thus, "The expenditure referred to in s. 35B(1)(b)(iv) of the IT Act, 1961, has to be incurred on the maintenance outside India of a branch, office or agency for the promotion of sales outside India of the assessee's goods, services or facilities. Therefore, what is requisite is that the assessee should have maintained the branch, office or agency outside India. It is also requisite that such branch, office or agency should be for the promotion of sales outside India of the assessee's goods, services or facilities." That the branch established by the assessee outside India should be for the promotion of the assessee's goods and services, and that the expenditure which qualifies for deduction is the expenditure on the maintenance of such branch has been made amply clear by the apex Court. The observation of the Court that expenditure has to be incurred on the promotion of sales of the assessee's goods outside India does not signify that all expenditure on the promotion of sale of the goods outside India would qualify for deduction in the context in which that observation is made. It is clear that it is only meant to underscore the requirement that branch outside India should have been maintained for the purpose of promoting the goods, services or facilities of the assessee outside India, and that the expenditure must have been actually incurred on such promotional activity. The incurring of such expenditure on promotional activity by the branch outside would demonstrate that the branch has been maintained for the purpose of promoting the sale of the goods, services or facilities. The assessee in this case is clearly not entitled to any weighted deduction on the interest paid by its customers at its foreign branch, as the expenditure so incurred is not expenditure on the maintenance of the branch which had been maintained for the purpose of promoting its goods, services and facilities outside India. The assessee in this case is clearly not entitled to any weighted deduction on the interest paid by its customers at its foreign branch, as the expenditure so incurred is not expenditure on the maintenance of the branch which had been maintained for the purpose of promoting its goods, services and facilities outside India. We, therefore, answer the question referred to us, viz, "Whether on the facts and in the circumstances of the case, the assessee-bank is entitled to weighted deduction under s. 35B(1)(b)(iv) of the IT Act, 1961, in respect of the interest payments amounting to Rs. 99, 57, 721 of its foreign branch at Bangkok, Thailand ?" in favour of the Revenue, and against the assessee. The Revenue shall be entitled to costs in the sum of Rs. 2, 000.