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TMI Blog1984 (10) TMI 82X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 5(1)(xxxii) of the Act should have been allowed on the authority of the decision of the Calcutta High Court in the case of Addl. CIT v. A. Mukherjee Co. (P.) Ltd. [1978] 113 ITR 718. 4. The assessee is a partner of a firm, styled, Balharsah Timber Depot, whose business activities consisted of purchasing logs and converting them with the help of sawing machines, planks and sized boards as per the specifications of its clients. The case of the assessee was that the firm was engaged in the processing of goods and so it came under the Explanation to section 5(1)(xxxii), so that it becomes entitled to the relief under section 5(1)(xxxii). The WTO did not agree with the claim of the assessee and rejected the same. 5. The assessee appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5(1)(xxxi) defines 'industrial undertaking' as an undertaking engaged in processing of goods (apart from other activities). The short question that is raised in this appeal is as to whether the activities carried on by the assessee before us can be said to be processing of goods. The term 'process' has not been defined in the Act. However, it is well settled that 'processing' has a wider meaning than the term 'manufacture'. At some point 'processing' and 'manufacturing' may merge, but a certain activity may amount to 'processing' even though it may not amount to 'manufacture' vide the decision in the case of Mahabirprasad Birhiwala v. State of West Bengal [1973] 31 STC 628 (Cal.), wherein the powdering of 'whole' black pepper and turmeric ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ber and other forest produce by leasing out forests would be entitled to deductions under sections 80HH and 80J [of the Income-tax Act, 1961]. 2. The matter was considered by the Board in consultation with the Ministry of Law which had given an opinion that the answer to the question posed would depend on the nature of the activity of the forest lessees ; however, if the process involved is not merely conversion of standing trees into fire-wood but also manufacture of new saleable commodities, the benefit of deduction under sections 80J and 80HH would be available. " It is clear that the circular issued says that mere conversion of standing trees into fire-wood will not amount to 'manufacture'. The circular is not concerned with the mea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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