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TMI Blog1992 (1) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... ll material times during the relevant previous years corresponding to the assessment years under reference, the assessee-firm was engaged in the business of constructing multi-storeyed buildings for sale of apartments contained therein. The assessee-firm claimed deduction in respect of profits and gains derived from its aforesaid activity under section 80J of the Income-tax Act, 1961. The assessee's claim for deduction under section 80J was negatived by the Assessing Officer on the ground that the construction of multi-storeyed buildings could not amount to manufacture or production of any "article". But the Commissioner of Income-tax (Appeals) for the assessment years 1978-79 to 1980-81 and the Appellate Assistant Commissioner of Income-tax for the assessment year 1975-76 allowed the said deduction treating the assessee as an industrial undertaking manufacturing or producing an "article" being the multi-storeyed building to qualify for the deduction. The Tribunal concurred with the view and allowed the relief to the assessee under section 80J of the Income-tax Act, 1961. The entire question hinges on the interpretation of clause (iii) of sub-section (4) of section 80J as the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a fundamental unity in that both the provisions confer benefit on industry of specified segments. In this decision of the Bombay High Court, a company engaged in construction works for buildings was not treated as an industrial company within the definition of the expression "industrial company" appearing in section 2(7) of the Finance Act. The decision is, as indicated, the reaffirmation of the same view taken by the Bombay High Court earlier in CIT v. N. U. C. (P.) Ltd. [1980] 126 ITR 377 (Bom). The definition of industrial undertaking in the Finance Act has been consistently as follows: " 'Industrial company' means a company which is mainly engaged in the business of generation or distribution of electricity or any other form of power or in the construction of ships or in the manufacture or processing of goods or in mining." What is of special note is the distinction maintained in the definition between the activities of "construction" and the activities of "manufacture or processing". The definition keeps the two parts in a discreet manner. The Bombay High Court held that the definition of industrial company covers only that construction company which is engaged in the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er to the question, whether constructing a building is equivalent to producing or manufacturing an "article". He urged that the definition of "industrial company" is on a different plane. It refers to manufacturing or processing of goods while clause (iii) of sub-section (4) of section 80J of the Income-tax Act, 1961, speaks of producing or manufacturing "articles". The use of the word "article" in contradistinction to the word "goods" makes all the difference and the decisions cited by the Revenue in the context of the definition of "industrial company" are contended to be of no relevance. According to him, the word. "article" is a word of more generic nature than the word "goods". He cites in support the statement of the meaning of the word "article" as appearing in the Shorter Oxford English Dictionary. According to it, "article" means "a commodity, a piece of goods or property". He lays the foundation for his case on the occurrence of the word "property" in the dictionary meaning. The fundamental point in his argument is that "article" being synonymous with "property" can embrace within its connotation all immovable properties including a building. He seeks to fortify his cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... " includes "a piece of property" has no impelling force to conclude that the word also denotes an immovable like a building. The meaning of a good many words has such variegation as lends them to obscurity unless viewed and construed in the proper light and in the context. "Property" is one such word whose meaning has a variety of shades. But the decision in CIT v. N. C. Budharaja and Co. [1980] 121 ITR 212 (Orissa) on the whole rests on this legal construction of the word "article". We shall address ourselves to this question later. The next case relied upon by learned counsel for the assessee is CIT v. Pressure Piling Co. (India) P. Ltd. [1980] 126 ITR 333 (Bom). This case is of a different strain. Here the assessee was not, in fact, constructing any building. It was making concrete mixture subject to certain process under pressure along with iron bars to serve as piles for the foundation on which the building to be constructed is to stand. Each pile was considered by the Bombay High Court as an object having independent existence to constitute an article. The mere fact that all the activities for manufacturing the piles had been carried on at the site of the construction works ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be ludicrous to suggest that an immovable property is an article. In common parlance article only refers to a movable property. It is no doubt true that when the word has not been statutorily defined or judicially interpreted, the court may take the aid of the dictionary to ascertain the meaning of a word, in common parlance, bearing in mind that a word is used in different senses according to the context and a dictionary gives all the meanings of a word and the court has, therefore, to select the particular meaning which is relevant to the context in which it has to interpret that word. When the Shorter Oxford English Dictionary defines "article" to include as one of its meanings "a piece of property", it merely implies movable property. The word 'a piece of property" cannot be generalised to connote any and every kind of property. But Webster's Third International Dictionary defines "article" as "piece of goods : commodity". Therefore, the view of the Orissa High Court that the word "article" does not preclude immovable property, with respect, is not the sense in which the word "article" is understood in popular parlance. Even the lawmakers have never associated immovable pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficial or partly natural, whether raw or partly or wholly processed or manufactured. In regard to designs, the term means any article of manufacture and any substance, artificial or natural or partly natural and partly artificial, vide section 2(2) of the Patents and Designs Act, 1911. We have referred to these statutes only to explain that the word "articles" of manufacture for trade, in its common acceptation, refers to goods and commodity. The word cannot but mean movables and excludes immovables. With respect, we differ from the view of the Orissa High Court wherein it includes in the meaning of the word immovable property like a building. Even abroad, the meaning of "articles" in the commercial sense is the same as the meaning of the word "goods". For example, the Constitution of the United States of America in the interests of the Federating States prohibits levy of tax or duty on inter-State movement of goods in the following words : "No tax or duty shall be laid on the articles exported from any State : vide article I, section 9". There could, of course, be some expansiveness in the expression "articles" in contrast to the word "goods". But in the context of manufac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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