Law:

Section:

Section 80E, read with item 13 of Fifth Schedule to the Income-tax Act, 1961 - Deductions - Profits and gains from manufacture or production of articles or things - Assessment year 1966-67 - Whether expression 'namely' used after word 'fertilizers' in item 13 to Fifth Schedule restricts meaning of word 'fertilizers' to only those types of fertilizers that are enumerated in said item - Held, yes - Whether since bonemeal manufactured by assessee-company was not one of those items enumerated in item 13, assessee was not entitled to rebate claimed under section 80E - Held, yes FACTS The assessee-company purchased bones, hoofs and horns of animal. These were degreased and unnecessary substances like glue and tallow were eliminated and the residue, after dehydration was pulverised and converted into fertiliser know as bonemeal. The entire process was a mechanical one. The assessee claim rebate on the tax payable under section 80E, read with item 13 of the Fifth Schedule, on ground that it was engaged in the manufacture of fertilizers. The ITO did not give any rebate and also did not give any reason for not giving the rebate. But the AAC held that item 13 of the Fifth Schedule only enumerates certain types of the fertilisers and the benefit of rebate is available only to those industries which manufactured those enumerated items. Since the bonemeal is not one of the enumerated items of fertilizers, the assessee was not entitled to any rebate. The Tribunal considered that though item 13 uses the word 'namely' after the word fertilisers and enumerates the numbers of items, the enumerated items are only illustrations of the fertilisers and not restrictive of the meaning of the generic word 'fertiliser'. In that view, the claim for rebate was allowed by the Tribunal. On reference : HELD When the legislature used the expression "namely" after the word "fertilisers", the meaning given to the word should be restricted to those that are enumerated. The legislature has used both the words "namely" and "including" in the same Schedule V in items 13 and 18. Thus, the legislature clearly should have intended in using these different words in different entries to restrict or…

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