9911796707
TMI Blog1992 (2) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... m beverages. The assessee installed a generator in its factory to supply power to the main plant during the course of failure in the supply of electricity. The Assessee claimed investment allowance on the generator. The Inspecting Assistant Commissioner of Income-tax disallowed the claim on the ground that the generator at best gave indirect assistance for the manufacturing process during the period of power failure. The assessee did not manufacture or produce any article or thing as envisaged in section 32A of the Income-tax Act, 1961. Being aggrieved by the order of the Inspecting Assistant Commissioner of Income-tax, the assessee filed an appeal before the Commissioner of Income-tax (Appeals) who was of the view that, as per section 32 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence to the manufacturing process of the assessee. The manufacturing process of the assessee appears to be different from the manufacturing process given in item No. 5. Under the said circumstances, the assessee was entitled to investment allowance and, therefore, the finding of the Commissioner of Income-tax (Appeals) is maintained." At the hearing before us, our attention has been drawn to a decision of this court in CIT v. Peerless Consultancy Services (Pvt.) Ltd. [1990] 186 ITR 609, where it has been held that, because the assessee in that case was an industrial company within the meaning of section 2(7)(c) of the Finance Act, 1981, it was entitled to investment allowance in respect of the generator installed by the assessee even thou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m are used." It, however, appears that the assessee's learned counsel asserted before the Tribunal that the assessee was not manufacturing " aerated waters " in which blended flavouring concentrates were used. It is manufacturing aerated waters out of synthetics. This indicates that the assessee's manufacturing process involved use of synthetic elements. An Explanation below item No. 5 was inserted by the Finance Act, 1987, with effect from 1988 which clarified what the Legislature meant by the expression " blended flavouring concentrates." According to that Explanation, the concentrates referred to "shall include, and shall be deemed always to have included, synthetic essences in any form." Before the Tribunal, as is evident from the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see is manufacturing aerated waters out of synthetics. Therefore, if, by the statement, the assessee meant that it was using synthetic essences, the assessee would go out of the ambit of section 32A at the very threshold. The question whether generator was an integrated part of the process of manufacture would become redundant. We, therefore, remand the case to the Tribunal to go into the nature of the assessee's product to ascertain whether by " manufacture out of synthetics " means that the product involved the use of synthetic essences. The Explanation below item No. 5, though inserted by the Finance Act, 1987, with effect from April 1, 1988, has to be taken to be only clarificatory in nature and should be referable for the purpose of ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
