2001 (11) TMI 18 - HC - Income Tax

Whether the assessee would be entitled to investment allowance under section 32A of the Income tax Act, 1961, with respect to the additions to plant and machinery on the basis that its business of warping, sizing and bleaching of unbleached cloth would amount to manufacture. - the question referred to us is answered in favour of the assessee and against the Revenue.

Summary

The High Court of Madras ruled in favor of the assessee, stating that their business activities qualified for investment allowance under section 32A of the Income Tax Act, 1961. The court cited a similar case where processing unbleached grey cloth was considered manufacturing, entitling the assessee to investment allowance and relief under section 80J of the Act.