This is appeal filed by assessee-company against order of Commissioner (Appeals), Bombay. 2. assessee is private limited company and appeal relates to assessment year 1978-79. Among claims before ITO in course of assessment proceedings, was that borrowed capital should not be excluded from capital employed for purpose of working out deduction under section 80J of Income-tax Act, 1961 (the Act). Another claim before ITO was claim of weighted deduction under section 35B of Act on expenses of Rs. 2,220 for export inspection fees. ITO, however, did not accept these claims made by assessee-company while completing assessment. When matter went up in appeal, Commissioner (Appeals) agreed with ITO on both of these issues and refused to interfere. assessee-company has, therefore, come up in present appeal before us. 3. assessees learned counsel, Dr. Shah, submitted to us that retrospective amendment of section 80J brought about by Finance (No. 2) Act, 1980 with retrospective effect from 1-4-1972 had been stayed by Honble Supreme Court. He further submitted that in these circumstances, it was not open to revenue authorities to act on retrospective amendment of section 35B. Alternatively, he submitted that revenue authorities ought to have waited for final judgment of Honble Supreme Court on validity of retrospective amendment. 4. Dr. Shah invited our attention to section 35B(1)(b)( ix) and rule 6AA of Income-tax Rules, 1962 (the Rules) inserted by Income-tax (Eighth Amendment) Rules, 1981, with effect from 1-8-1981 in order to point out that expenses on maintenance of laboratory or other facilities for quality control or inspection of goods also qualifies for weighted deduction under section 35B. Proceeding further, he argued that like rule 1BB, rule 6AA of Rules was applicable to all pending assessments and appeal proceedings and, therefore, notwithstanding that this rule was inserted with effect from 1-8-1981, this will apply to appellate proceedings under consideration before us even though they related to assessment year 1978-79. last argument of Dr. Shah was that section 35B was enacted with view to encourage exports and, therefore, provisions of section 35B should be liberally construed with view not to defeat very object of introduction of this section. He, therefore, very vehemently contended before us that assessee-company was entitled to weighted deduction on export inspection fees of Rs. 2,220. 5. On other hand, learned departmental representative, Shri Roongta, submitted to us that order of Honble Supreme Court staying retrospective operation of section 80J to extent to which borrowed capital was excluded from capital employed within meaning of section 80J was interim order and that too not in assessees case. He, therefore, submitted that on issue of whether borrowed capital should be included in capital employed for purpose of section 80J, matter should be decided in accordance with retrospective amendment of section 80J brought about by Finance (No. 2) Act, with effect from 1-4-1972. 6. Shri Roongta read to us clause (c) of rule 6AA in order to point out that even under activities prescribed under section 6AA by Income-tax (Eighth Amendment) Rules with effect from 1-8-1981, weighted deduction would have been admissible on maintenance of laboratory or other facilities for quality control or inspection of goods and this will not apply where assessee did not maintain any laboratory or other facilities for quality control or inspection. He, therefore, vehemently argued before us that even rule 6AA is not applicable to payment of Rs. 2,220 made by assessee on account of export inspection fees paid to others. Even otherwise, according to Shri Roongta, rule 6AA which allowed weighted deduction on activities prescribed under rule could not be said to be procedural and, therefore, will only apply to expenses incurred on or after 2-8-1981. 7. We have carefully considered rival submissions. Honble Supreme Court by order dated 10-9-1980 in case of Lohia Machines Ltd. v. Union of India [1985] has stayed retrospective amendment of section 80J to extent to which it seeks to exclude borrowed capital in computing capital employed, for purpose of section 80J. Considering this, arguments of both sides and totality of facts and circumstances on issue of whether borrowed capital should be included in capital employed for purpose of section 80J, we send matter back to Commissioner (Appeals) for decision afresh keeping in view not only retrospective amendment of section 80J brought about by Finance (No. 2) Act, with effect from 1-4-1972, but also final orders of Honble Supreme Court on validity of retrospective amendment. 8. Clause (c) of rule 6AA prescribing activities on which weighted deduction under section 35B(1)(b)(ix) will be admissible refers to maintenance of laboratory or other facility for quality control or inspection of goods. This will, therefore, only apply where assessee maintains laboratory or other facility and not to payment made to others for inspection, or quality control of goods. assessee is, therefore, not entitled even on plain reading of clause (c) of rule 6AA to weighted deduction on export inspection fees. It is, therefore, not necessary for us to deal with other submissions made before us whether this rule will apply only to expenses incurred on or after 1-8-1981 or to all assessments or appeal proceedings pending on 1-8-1981, i.e., date of notifications of rules. We have, therefore, no hesitation in coming to conclusion that weighted deduction on export inspection fees of Rs. 2,220 was rightly not allowed by revenue authorities. 9. appeal is partly allowed. *** Entremonde Polyecoaters (P.) Ltd. v. Ninth Income-tax Officer