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TMI Blog1977 (4) TMI 32X X X X Extracts X X X X X X X X Extracts X X X X ..... any company engaged in the manufacture or production of any of the articles mentioned in the First Schedule to the Industries (Development and Regulation) Act, 1951 (LXV of 1951), is, in respect of its profits and gains attributable to such manufacture or production, (i) liable to pay any tax for the assessment year commencing on the 1st day of April, 1965 (hereinafter referred to as the base year), and for any one or more of the five assessment years next following that year ; or (ii) not liable to pay any tax for the base year but becomes so liable for any succeeding year (hereinafter referred to as the succeeding base year) and also for any one or more of the assessment years following that year, not being an assessment year commencing on the 1st day of April, 1971, or any subsequent assessment year, and the tax for any such succeeding year exceeds- (a) in the case referred to in clause (i), the tax payable for the base year ; (b) in the case referred to in clause (ii), the tax payable for the succeeding base year, then the company shall be granted a tax credit certificate for an amount equal to twenty per cent. of such excess, Provided that the amount of the tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of India had actually issued a licence for setting up a unit for manufacture of cellulose film. The Ministry of Commerce and Industry had by order dated March 4, 1954, granted a licence under rule 15(2) of the Registration and Licensing of Industrial Undertakings Rules, 1952, to effect a substantial expansion of the company's existing industrial undertaking for the manufacture of "transparent paper", which the company states is the goods in question. The petitioner-company also obtained and filed before the first respondent a confirmatory letter from the Ministry of Commerce, Government of India, to the effect the cellophane-cellulose film-industry is included in the First Schedule of the Industries (Development and Regulation) Act, 1951. But the first respondent passed orders dated February 28, 1973, withdrawing the excess relief in respect of the two assessment years-- Rs. 3,41,937 in regard to 1967-68 and Rs. 2,62,041 in regard to 1968-69. The respective order is marked as exhibit P-8 in each of the two cases. Appeals were filed from these orders to the second respondent in these writ petitions-the Commissioner of Income-tax, Kerala I, Ernakulam. Without going into the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... obvious, glaring or self-evident. Where the matter in issue is controversial or debatable and there are two views possible, the alleged mistake cannot be said to be a mistake apparent from the record. It is submitted by the petitioner that if two interpretations are possible in respect of a statutory provision, one most favourable to the assessee should be adopted. In regard to the appellate order, exhibit P-10, what is contended for is that the second respondent has not properly appreciated the scope and contents of paragraph 5 of the Scheme, which provides for a right of appeal. Paragraph 5(1) provides that any company aggrieved by the order of the Income-tax Officer passed under paragraph 4 may appeal to the Commissioner against such an order. Under paragraph 8 when an order is sought to be rectified, he shall proceed to make a fresh determination under paragraph 4. According to the petitioner, the effect of this provision is that the rectified order gets the attributes of an order under paragraph 4 and is, therefore, appealable under paragraph 5. The petitioner also takes up the plea that the second respondent in summarily dismissing the appeal acted in violation of the prin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Twentieth Century Dictionary gives the meaning is-- "a material made in thin sheets as an aqueous deposit from linen rags, esparto, wood-pulp, or other form of cellulose, used for writing and printing, wrapping and other purposes : sometimes extended to similar materials not so made, as papyrus, rice-paper, to the substance of which some wasps build their nests, to card-board, and even to tin-foil ('silver paper' )." Cellophane is really the transparent cellulose sheet. It is prepared as follows (as succintly stated in Organic Chemistry by Cram and Hammond--International Student edition-2nd edition, page 695) : "Perhaps the best known product from cellulose is cellophane, a clear sparkling film having approximately the same composition as cellulose. Cellophane is made by a complicated process that is understood in principle but not in detail. First the cellulose is dissolved in concentrated aqueous sodium hydroxide. Then the alkali cellulose is treated with carbon disulphide to produce cellulose xanthate. Finally, sulphuric acid is added to coagulate the cellulose. As coagulation occurs, the cellulose is stretched into a film. On paper the chemistry looks like simple diss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sumed to have used an ordinary term as coal according to the meaning ascribed to it in common parlance. Viewed from that angle both a merchant dealing in coal and a consumer wanting to purchase it would regard coal not in its geological sense but in the sense as ordinarily understood and would include 'charcoal' in the term 'coal'. It is only when the question of the kind or variety of coal would arise that a distinction would be made between coal and charcoal ; otherwise both of them would in, ordinary parlance as also in their commercial sense be spoken as coal." On the same principle in Sree Rama Trading Co. v. State of Kerala [1971] 28 STC 469 (Ker) this court held that cellophane-cellulose film-is not paper falling within entry 42 of the First Schedule in the Kerala General Sales Tax Act, 1963, which entry reads, "paper (other than newsprint), card boards, straw board and their products". The court said that though paper and cellophane are both manufactured from cellulose and that cellophane sheets are used as packing materials, that does not mean paper and cellophane are the same in commercial and popular sense. However, that does not mean that cellophane-cellulose film ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Blackburn said in Edinburgh Street Tramways Co. v. Torbain [1877] 3 App Cas 58 at 68 : " Words used with reference to one set of circumstances may convey an intention quite different from what the self-same set of words used in reference to another set of circumstances would or might have produced', and therefore it sometimes happens that, as Best C.J. said in Wynne v. Griffith [1825] 3 Bing 179 at 196, 'the same words receive a very different construction in different statutes.' " It might be noted in this connection that the Industries (Development and Regulation) Act, LXV of 1951, is an Act to provide for the development and regulation of certain industries. Provisions have been made in the Act for regulation of scheduled industries, procedure for grant of licences, power to cause investigation to be made, etc., under the Act. Petitioner was granted a licence for setting up a unit for the manufacture of cellulose film, the Commerce and Industries Department of the Union Government taking the view that the industry is included in the First Schedule to the Act. I am not referring to it as if the department's view in the matter is conclusive or should affect the court's decision ..... X X X X Extracts X X X X X X X X Extracts X X X X
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