Law:

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Section 32A of the Income-tax Act, 1961 - Investment allowance - Whether definition of words 'manufacturing process' in Factories Act, 1948 can be imported in section 32A - Held, no - Whether assessee operating, a cold storage plant can be allowed investment allowance - Held, no Facts The assessee-firm was deriving its income by operating a cold storage plant. In the relevant assessment year, the assessee claimed investment allowance under section 32A which was rejected by the ITO. On appeal, the Tribunal upheld the ITO's order. The Tribunal further held that the definition of the words 'manufacturing process' in section 2K of the Factories Act, 1948 could not be imported in section 32A. On reference, the assessee contended, inter alia, that the operation of cold storage plant resulted in manufacture of cool air. Held It was held by the Supreme Court in Bam Narain v. State of U.P. AIR 1957 SC 18 that it is not a sound principle of construction to interpret expressions used in one Act with reference to their use in another Act. The Tribunal, in the instant case, was therefore, right in holding that the definition of the words 'manufacturing process' in the Factories Act could not be imported in section 32A of the 1961 Act. It is well settled that when any Act does not define a word used in that Act, the Legislature must be taken to have used that word in its ordinary dictionary meaning. In common parlance, the words 'make', 'manufacture' and 'produce' are all used as synonyms and they relate to the turning out of finished products by the shaping or combination of raw materials or parts. 'Make' is the most general and informal word and can apply to any process of construction. 'Manufacture' is narrower in scope while 'produce' approaches the generality of 'make' and stresses the neutral aspect of 'manufacture'. It emphasises the amount of a product turned out, without necessarily implying a process of mass production, as would be the case with 'manufacture'. As held by the Supreme Court in Ram Narain's case (supra), the meanings of words and expressions used in an Act must take their colour from the context in which they appear. Now these words occur in clause…

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