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TMI Blog1981 (9) TMI 171X X X X Extracts X X X X X X X X Extracts X X X X ..... nting to Rs. 56,180, should be deducted from the value of plant and machinery, amounting to Rs. 10,29,524, as disclosed in the balance sheet as on 31-3-1977 and that if the value of the said two items was excluded, the value of the plant and machinery would be Rs. 9,73,344 only and that the appellant would be entitled to be treated as small-scale industrial undertaking to which the benefit of section 32A(1) would be admissible. It was the argument of the appellant that these two items "tensile tester" and "humidity control cabinet" should not be considered as plant and machinery, but should be considered as machine tools. 3. The ITO, however, did not accept these contentions of the appellant. He pointed out that these two items of machinery, namely, "tensile tester" and "humidity control cabinet" were considered by the appellant himself as part of its plant and machinery, as disclosed in its balance sheet, which also had a separate head for Tools and Equipments, the value of which was disclosed at Rs. 1,15,867 as on 31-3-1977. The ITO, therefore, rejected the appellant's claim that it was a small-scale industrial undertaking and held that it was not entitled to the deduction of in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 32A(2) defines what is a small-scale industrial undertakings and allows such undertaking the tax concession irrespective of what it produces, but proceeds to state that all other industrial undertakings would be eligible for the concession only if they produce the articles listed in the Ninth Schedule. The criterion fixed to determine whether an industrial undertaking is small-scale or not is the aggregate value of the machinery and plant (other than tools, jigs, dies and moulds) installed as on the last day of the previous year for the purposes of the business of the undertaking, and the line has been drawn at Rs. 10 lakhs. The expression "machinery and plant" in section 32A(2) is qualified only by the exclusion of tools, jigs, dies and moulds as clearly specified in the sub-section itself and I see no justification to exclude anything else, in the absence of either words to that effect in the provision or anything else repugnant to a plain interpretation of the provision. If the learned representative's contention were to be accepted, undertakings which are really not small-scale industrial undertakings, as the Legislature contemplated, would walk away with investment al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing within the meaning of section 32A(2)(b)(ii) read with its Explanation. He argued that the Commissioner (Appeals) was not justified in including the 10 items, the cost of which was Rs. 1,89,257, while excluding the cost of three items of tools amounting to Rs. 1,11,783. The learned counsel contended that what was contemplated in section 32A(2) for determining the nature of a small-scale industrial undertaking was only machinery and plant used in the actual manufacture or production of articles to determine their ceiling of Rs. 10 lakhs, specified in clause (2) of Explanation to section 32A(2). According to Mr. Aggarwal, this was the meaning of the words "for the purposes of business of manufacture or production of any article or thing", specified in section 32A(2)(b)(iii). Shri Aggarwal submitted that these words do not comprehend other activities in the business of appellant. He, therefore, argued that on the findings recorded in paragraphs 2.8 and 2.9 of his order, the Commissioner ought to have held that the appellant was a small-scale industrial undertaking and accordingly directed the ITO to allow investment allowance under section 32A(1). 6. On behalf of the revenue, Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th its Explanation for facility of reference: "(2) The ship or aircraft or machinery or plant referred to in sub-section (1) shall be the following, namely:--- (a) a new ship or new aircraft acquired after the 31st day of March, 1976 by an assessee engaged in the business of operation of ships or aircraft ; (b) any new machinery or plant installed after the 31st day of March, 1976--- (i) for the purposes of business of generation or distribution of electricity or any other form of power ; or (ii) in a small-scale industrial undertaking for the purposes of business of manufacture or production of any article or thing ; or (iii) in any other industrial undertaking for the purposes of business of construction, manufacture or production of any article or thing, not being an article or thing specified in the list in the Eleventh Schedule. Explanation: For the purposes of this sub-section and sub-sections (2B) and (4)--- (1) 'new ship' or 'new aircraft' or 'new machinery or plant' shall have the same meanings as in the Explanation to clause (vi) of sub-section on (1) of section 32 ; (2) an industrial undertaking shall be deemed to be a small-scale industrial undertaking, if the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dies and moulds". Apart from these four items, no other item of machinery or plant installed in a small-scale industrial undertaking should be excluded. Further, if the Parliament intended that only such of those items of machinery and plant which were actually used in the manufacture or production of any article or thing should be considered, the language of section 32A(2) and its Explanation would have been entirely different. We find that the emphasis is laid on the utilisation of the new machinery and plant installed for the purposes of four types of businesses, specified in section 32A(2). They are the following: (i) business of operation of ships or aircrafts; (ii) business of generation or distribution of electricity or any other form of power; (iii) business of manufacture or production of any article or thing in a small-scale industrial undertaking; (iv) business of construction, manufacture or production of any article or thing other than an article or thing specified in the list in the Eleventh Schedule, by any other industrial undertaking. We are unable to agree with the learned counsel that the Parliament has used the words "for purposes of business" in these vario ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... construction is the same for all statutes, whether fiscal or otherwise. The Supreme Court further held that the underlying principle is that the meaning and intention of a statute must be collected from the plain and unambiguous expression used therein, rather than from any notions, which may be entertained by the Court as to what is just or expedient and that the expressed intention must guide the Court. 12. Respectfully following these principles laid down by the Supreme Court, we hold that there is no warrant for omitting the two words "of business" in the expression "for the purposes of business of manufacture or production of any article or thing" in section 32A(2)(b)(ii). We, therefore, reject the submissions of the learned counsel and agree with the reasoning and conclusion of the Commissioner (Appeals) in paragraph 2.5 of his order, which we have extracted above. 13. At the same time, we are unable to accept the findings of the Commissioner (Appeals) for the exclusion of the three items of machinery, namely, "tensile tester", "humidity control cabinet" and "lathes" as tools within the meaning of that word appearing in clause (2) of Explanation to section 32A(2). In paragr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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