9911796707
TMI Blog1988 (4) TMI 87X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s. Mansukhlal Jechand are to purchase kala-kapas directly from the agriculturists, to obtain cotton and cotton seeds from kala-kapas by manual labour, to gin and press cotton by outside ginning press and to sell cotton bales. 4. On the aforesaid facts, the assessee claimed exemption u/s 5(1)(xxxii) of the Act, in respect of their respective share of interest in the firm of M/s. Mansukhlal Jechand. The WTO rejected the claim made by the assessees on the ground that the firm was not an "industrial undertaking". 5. Before the AAC, relying on the decision in the case of CIT v. A. Mukherjee Co. (P.) Ltd. [1978] 113 ITR 718 (Cal.), it was submitted on behalf of the assessees that in order to claim exemption u/s 5(1)(xxxii) of the Act, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct which defines "industrial undertaking", which was considered by the Hon'ble High Court. He, therefore, urged that the orders of the AAC should be reversed. 7. The learned counsel for the assessees, on the other hand, supported the orders of the AAC by relying on the decision of the Hon'ble Madhya Pradesh High Court in the case of CWT v. Smt. Premlatabai [1982] 137 ITR 329. In that case also, the point involved was about exemption claimed u/s 5(1)(xxxii) of the Act. In this connection, the learned counsel for the assessees highlighted the fact that the facts obtaining in the case of the assessees are even stronger than that obtaining in the reported case. He further pointed out that the Hon'ble High Court has also considered the Explana ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot be disputed that the end manufacture may involve several processing. We are, therefore, of the opinion that if the assessee has done any processing, which ultimately brought about the product, he is entitled to avail of the above provision. We find support from the decision reported in CIT v. Commercial Laws of India Pvt. Ltd. [1977] 107 ITR 822 (Mad.). " In the instant case it is not in dispute that the assessee itself has got separated cotton and cotton-seeds from the kala-kapas purchased directly from the agriculturists. Further, we find from this decision that the Hon'ble High Court has disposed of twelve references by a common judgment and has decided certain cases in favour of the assessee. For example in paras (12) and (19), ..... X X X X Extracts X X X X X X X X Extracts X X X X
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