M. N. CHANDURKAR C. J.


At the instance of the Revenue, the following three questions have been referred to this court under section 256(1) of the Income-tax Act

"1. Whether, on the facts and in the circumstances of the case, Rs. 34, 008, being 50% of the expenditure incurred by the assessee for providing carpets and screens in the two cinema theatres is to be allowed as revenue expenditure for the assessment year 1972-73 ?


2. Whether, on the facts and in the circumstances of the case, the assessee is entitled to depreciation at 15% of Rs. 4, 27, 967, being the cost of the partition works and false ceilings for the assessment year 1972-73 ?


3. Whether, on the facts and in the circumstances of the case, the assessee is entitled to deduction of Rs. 9, 680, being provision made for gratuity payable to its employees ?" *


Counsel for the Revenue fairly concedes that, in view of the decision of this court in CIT v. Indian Metal and Metallurgical Corporation 1983 (141) ITR 40, 1983 (35) CTR 103, 1983 (13) TAXMAN 383, 35 CTR(Mad) 103 for the earlier assessment year 1971-72, questions Nos. 1 and 2 have to be answered in favour of the assessee. In so far as question No. 3 is concerned, learned counsel for the Revenue also fairly concedes that that question has also to be answered in favour of the assessee in view of the decision of this court in CIT v. Andhra Prabha (P.) Ltd. 1980 (123) ITR 760, 1980 (14) CTR 269, 1980 (4) TAXMAN 314, 1980 (14) CTR(Mad) 269 which view is now confirmed by the Supreme Court in the decision in CIT v. Andhra Prabha (P.) Ltd. 1986 (158) ITR 416, 1986 (54) CTR 313, 1986 (54) CTR(SC) 313Accordingly, the three questions are answered as follows:


Question No. 1 In the affirmative and in favour of the asse

ssee Question No. 2 In the affirmative and in favour of the assessee Question No. 3 In the affirmative and in favour of the assessee No order as to costs.