Law:

Section:

Section 32a, read with item 1 of ninth schedule, of the income-tax act, 1961-Investment allowance-Assessee was engaged in business of purchasing tin sheets and converting them into containers-Manufacturing process involved use of iron and steel-Whether assessee could be treated as engaged in manufacture of iron and steel, so as to be entitled to investment allowance on its machinery-Held, on facts, no Facts The assessee was a company carrying on the business of purchasing tin sheets and converting the same into containers, both plain and printed, by a manufacturing process. It claimed investment allowance in respect of the machinery installed before 2-2-1977. The claim was rejected by the ITO on the ground that the assessee was not a manufacturer of iron and steel, but it merely used iron and steel manufactured by others in the process of manufacture of tin containers. In appeal, the assessee supported its claim by citing reference to (i) Indian Standard Institution Manual which denned the words 'tin plate' ; (ii) a certificate from the Tamil Nadu Industrial Investment Corporation to the effect that the item manufactured by the assessee should be classified under the head Iron and Steel (Metal); (iii) a similar certificate from the State Industries Promotion Corporation of Tamil Nadu Ltd.; (iv) a photostat copy of import licence issued to the assessee ; and (v) a certificate from the Central Excise Department classifying assessee's industry as 'Iron and Steel' (Metal). However, both the Commissioner (Appeals) and the Tribunal rejected the assessee's plea and confirmed the order of the ITO. The Tribunal also rejected the assessee's application for reference under section 256(1). On application under section 256(2) : Held It had been factually found by the Tribunal that the articles manufactured by the assessee were only metal containers made out of tin plates. Therefore, the assessee was not in fact manufacturing any iron and steel. Even assuming, as claimed by the assessee, that iron and steel was used for the manufacture of metal containers, the assessee could never claim to be a manufacturer of iron and steel. Therefore, the Tribunal was justified in…

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