9911796707
TMI Blog1983 (9) TMI 172X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the assessee was not having any looms of its own and was doing manufacture outside on contract basis. In other words, the WTO rejected the claim of exemption for the reason that the assessee itself did not carry on the manufacturing or processing activity. 4. On appeal it was contended on behalf of the assessee that it was not necessary that the assessee should be the owner of looms to be eligible for exemption under s. 5(1)(xxxii) of the Act and even if the manufacturing of processing was done from outside agencies the assessee was nonetheless eligible for exemption. After due consideration of several decisions of the Tribunal and the decision of the Madhya Pradesh High Court in the case of CWT vs. Smt. Premlate Bai (1982) 31 CTR (MP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ors. vs. Smt. M. Annai Jayabarathi Ors. in W.T.A. Nos. 340 341 (Mds) asst. yrs. 1977-78 dt. 30th July, 1980 since (1980) TTJ 296 (Mad). Further he referred to the decision of the Supreme Court in the case of CST vs. Dr. Sukh Deo (1969) 23 STC 385 (SC) wherein the Supreme Court observed that the manufacturer is a person by whom or under whose direction or control the goods are manufactured and stated even the decision of the Madras High Court in the case of CWT vs. K. Lakshmi cited supra, which has been relied upon by the ld. Departmental Representative would support the assessee s case inasmuch as the assessee has carried out at least some processing by itself. Narrating the various activities he filed certain papers at the time of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ities involved in the manufacture of handloom sarees. According to the assessee following processes are involved in the manufacturing activity: (i) The assessee purchases art silk yarn supplied in cases of 50 Kg., 45 Kg., 90 Kg., etc ; (ii) The assessee gives the above yarn to outside agency for twisting and warping; (iii) Such warped yarn are again given to outside agency for dying giving specific instructions of colour; (iv) After receipt such coloured yarn is given to outside agency for making it stiff using vajram (an adhesive); (v) The assessee also purchases cotton yarn which is given to days giving specification of colour ; (vi) Thereafter the weavers are called to the assessee s place and the assessee with the assistance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of his staff: over the covers markings are made by the assessee to show size colour and design; (xiii) Thereafter, the assessee with the assistance of his staff put and tie yarn bands with knots on each wrapped saree so that folding may stay intact and not become loose; (xiv) Thereafter the packed sarees are despatched by the assessee mostly to places outside the State packing them in bales of 40s. 50s., etc., sarees in each pack, by nailing them. Some of the items, say item No. (iv) to (xiv), were done by the employees of the assessee especially darning cutting unwanted edges, affixing trade mark seal, labelling, ironing, calendering and wrapping. Therefore, it is clear that the assessee has carried out at least some processes whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eived from the Sangam government allotment of imported raw materials like viscose filament yarn etc. Evidence has also been produced by way of allotment letter from the Sangam in which the assessee has declared that the raw materials would be utilised only for manufacturing purposes. The Income-tax assessment order for the asst. yr. 1980-81 also describes the business of the assessee as that of manufacture and sale of handloom sarees and assessed the income under the head business . Thus on a consideration of the decisions of the Courts and also in view of the facts and circumstances of the case, we hold that the assessee is entitled to exemption under s. 5(1)(xxxii). Therefore, we set aside the orders of the authorities on this point and d ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
