Law:

Section:

Section 2(6)(d) of the finance act, 1968 and section 2(6)(c) of the finance act, 1969-Industrial company-Assessment years 1968-69 and 1969-70-Assessee-company engaged in business of cold storage-Whether assessee-company was engaged, in processing of goods and was, accordingly, industrial company within the meaning of section 2(6)(d) of the Finance Act, 1968 and section 2(6)(d) of the finance act, 1969-Held, on facts, yes Facts The assessee-company had been engaged in the business of running a cold storage plant. Its income consisted of charges collected from the growers of the potato for allowing them to store their products inside the assessee's plant in order to preserve these from perishing and keeping them in marketable condition. For the assessment years 1968-69 and 1969-70, the ITO levied tax at 65 per cent on the basis that the assessee was not an industrial company within the meaning of section 2(6)(d ) of the Finance Act, 1968 and section 2(6)(c) of the Finance Act, 1969. On appeal, the AAC observed that the assessee's activity fell within the meaning of processing of goods and, by relying on section 80J(1) and (4), directed the ITO to treat the assessee-company as an industrial company engaged in the processing of goods and charge income-tax at the rate of 55 per cent. The Tribunal dismissed the revenue's appeal, holding (i ) that the AAC had erred in seeking support from section 80J in construing the provisions of the relevant Finance Acts in view of the fact that the Finance Acts contained their own definition; (ii) that, although there was no merit in the assessee's contention that it came within the definition of an "industrial company" because it generated power in the act of cold storage, the assessee-company was engaged in the activity of processing of goods by preventing food products from natural decay by storing them in cold storage, and, as such, came within the definition of an "industrial company" under the relevant Finance Acts. On reference: Held 1. Under the Finance Acts, 1968 and 1969, the Legislature has advisedly used different expressions, namely, manufacture, processing or mining. Therefore, it is apparent that the Legislature was…

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