JUDGMENT
DR. B.P. Saraf, J.
1. By this reference under section 256(1) of the Income-tax Act, 1961, the Income-tax Appellate Tribunal has referred the following question of law to this court at the instance of the Revenue :
“Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the assessee, a foreign technician, was entitled to the relief under section 10(6)(viia)(I)(B) for the assessment year 1975-76 ?”
2. The controversy in this case is in a narrow compass. The assessee is a foreign technician. He came to India in February, 1972, to work with Ivan Milutinovic PIM (hereinafter referred to as “the company”). The said company carried on the business of construction of ports and harbours, dredging and reclamation and marine construction. The head office of the said company was situated in Yugoslavia with a branch in India. The assessee is an experienced technician with practical knowledge of electrical installation. The probable duration of his employment was three years. His place of duty was at Naval Dockyard Expansion Project. On March 11, 1972, the employer of the assessee wrote to the Director-General of the Naval Dockyard Expansion Scheme requesting them to forward an application for exemption from payment of income-tax for the employee under section 10(6)(viia)(I)(B) of the Act to the Central Government. The approval was granted by the Central Government by its letter dated May 26, 1972, for a period of two years. On March 25, 1974, the employer of the assessee applied for extension of the exemption. There was some delay on the part of the Central Government in communicating the approval to the employer of the assessee. The approval was granted on October 4, 1975. There is no dispute about the eligibility of the assessee to get the exemption from income nor is there any dispute that the assessee as entitled to the benefit if the approval had been accorded by the Central Government on or before October 1, 1975. The dispute has arisen on account of approval being accorded on October 4, 1975, i.e., beyond October 1, 1975. The sole controversy is whether the three days’ delay on the part of the Central Government in according approval on the application of the employer which had been made well within time can be fatal to the right of the assessee to get the benefit of exemption which he is entitled to under section 10(6)(viia)(I)(B) of the Act.
3. The Tribunal was of the opinion that everything was done by the employer of the assessee well within time. The delay in granting approval was for no fault of theirs. The approval, once accorded, should relate back to the date of application. The Tribunal, therefore, held that the assessee was entitled to the benefit. The assessee cannot be denied the benefit on account of delay on the part of the Central Government in according approval when the employer had done everything necessary.
4. We have heard counsel for the parties. We have carefully considered the facts of the case. We are of the clear opinion that the assessee being eligible to get the benefit of exemption under section 10(6)(viia)(I)(B) of the Act and the employer of the assessee having complied with all the requirements laid down in the Act for that purpose, the benefit cannot be denied to him because of delay on the part of the Central Government in according approval. In such cases the approval, once accorded, has to relate back to the date of the application. It is the only just and reasonable interpretation that can be given to such a provision.
5. We are, therefore, of the clear opinion that the Tribunal was justified in holding that the assessee was entitled to relief under section 10(6)(viia)(I)(B) of the Act for the assessment year 1975-76. We, therefore, answer the question in the affirmative, i.e., in favour of the assessee and against the Revenue.
6. Under the facts and circumstances of the case, we make no order as to costs.