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TMI Blog1984 (6) TMI 67X X X X Extracts X X X X X X X X Extracts X X X X ..... n. The assessee filed return of income and thereby made claims inter alia for investment allowance under s. 32A of the IT Act, 1961, hereinafter referred to as the Act on the assets of value of Rs. 82,276. 3. The ITO did not accept the claim of the assessee on the ground that the machinery or plant installed was not for the purpose of business of construction, manufacture or production of any article or thing; that the so called machinery installed was like water heater plant, ratio, kitchen equipments Elec. installation; that the functions of these equipments are not to manufacture any thing as provided in the Act and as such, investment allowance should not be admissible to the assessee. In appeal, the Commissioner(A) confirmed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (SC) 548. On the other hand, Shri Harne, the ld. Departmental representative contends that the assessee is engaged in hotel business and, therefore, it is trading concern; hence no question arises for allowing the investment claimed under s. 32A of the Act on the assets mentioned above, reliance is placed on the decisions in the case of CIT vs. Casino Pvt. Ltd. (1973) 91 ITR 289 (Ker), CIT vs. Buhari Sons Pvt. Ltd. (1983) 144 ITR 12 (Mad) and on the decision in the case of Saluja Cold Storage vs. ITO (1982) 1 ITD (1982) 1 ITD 751(All) 5. We have heard the rival contentions and gone through the record before us. Shri Shah, the ld. Counsel for the assessee contends that the case of the assessee falls under s. 32A(1)(b)(iii). Relying on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ey have nowhere held that hotel business is an industrial undertaking for the purpose of allowance under s. 32A of the Act. Furthermore, the contention of the ld. counsel for the assessee cannot be accepted on the ground that if a dispute is to be settled between the assessee and its workmen by the Industrial Tribunal under the Industrial Disputes Act, 1947, then the assessee should be an industrial undertaking for the purpose of investment allowance under s. 32A of the Act. It is settled law that the definition, description and meaning of the terms and words in one Act should not be the same or should be taken for the interpretation of the same words in another Act. The meanings of terms, phrases and words in the Act are to be taken which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aken to be manufacture of goods. The word 'goods' used in s. 2(7)(d)of the Finance Act, 1966, has been used in the sense of merchandise i.e. articles for sale, and so understood in a commercial sense, the expression 'goods' will not include eatables prepared in a hotel. Further, the expression "manufacture" does not connote a trading activity and an activity carried on in a hotel can only be taken to be a trading activity and not a manufacturing activity". In the case of CIT vs. Casino Pvt. Ltd. (1973) 91 ITR 289 (Ker), their Lordships of the Kerala High Court held that a hotel is mainly a trading concern. It would not be appropriate in the ordinary sense to refer to the production of food materials in a hotel as manufacture. The activity c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpanies which are included in the term are those mainly engaged in the business of generation or distribution of electricity or any other form of power, or mainly engaged in the construction of ships or similarly engaged in mining, or in the manufacture or processing of goods. This indicates that the reference is to manufacturing concerns as against trading concerns. A hotel is mainly a trading concerns. It would not be appropriate in the ordinary sense to refer to the production of food materials in a hotel as manufacture. The activity carried on in preparing articles of food from raw material in a hotel would not constitute "manufacture or processing of goods" within the meaning of s. 2(6)(d)of the Finance Act, 1968. A company which ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cold Storage vs. ITO, the issue for determination before the Tribunal was whether the plant and machinery used in cold storage can be treated as engaged in manufacture or production of articles or things; hence entitled to investment allowance under s. 32A of the Act. The Tribunal relying upon the decision of the Hon'ble Supreme Court in the case of Delhi Cloth General Mills Co. Ltd. vs. Union of India AIR 1963 (SC) 791 wherein their Lordships held that processing cannot be equated with manufacturing and that 'manufacture' means to being into existence a new substance and not merely produce some changes in the substance, however minor in consequence the change may be held. Accordingly, that while the business of cold storage may satisfy t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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