Law:

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Section 32A of the Income-tax Act, 1961 - Investment allowance - Whether mere preservation of an existing article in cold storage does not amount to any production - Held, yes - Whether, therefore, preservation of potatoes in cold storage plant did not amount to production of an article for purposes of section 32A(2)(b)(ii) and as such assessee was not entitled to investment allowance - Held, yes FACTS The assessee-company claimed that the preservation of potatoes in the cold storage plant amounted to production of an article for the purposes of section 32A(2)(b)(ii ), and as such the assessee was entitled to the investment allowance. The High Court negatived the assessee's claim. On application for leave to appeal to the Supreme Court: HELD Mere preservation of an existing article by subjecting it to a process of cold storage does not amount to any production. The law in regard to same is settled by the Supreme Court in Chrestien Mica Industries Ltd. v. State of Bihar [1961] 12 STC 150 and Empire Industries Ltd.v. Union of India [1986] 162 ITR 846, which were followed by High Court. Therefore, it was to be held that the assessee was not entitled to benefit of section 32A. The application was, therefore, rejected. Note : The decision is against the assessee. CASES REFERRED TO Chrestien Mica Industries Ltd. v. State of Bihar [1961] 12 STC 150 (SC) , Empire Industries Ltd. v. Union of India [1986] 162 ITR 846 (SC) and S.B. Storage Industries (P.) Ltd. v. CIT [1987] 166 ITR 646 (Cal.). Dr. D. Pal and Manisha Seal for the Applicant. A.C. Moitra and Sunil Mukherjee for the Respondent. JUDGMENT Dipak Kumar Sen, J.-S.B. Cold Storage Industries Pvt. Ltd., the applicant, seeks a certificate from us that substantial questions of law of public importance arise from the judgment of this court dated August 26, 1986 (see.[1987] 166 ITR 646), delivered in the above income-tax reference and that this is a fit case for appeal to the Supreme Court. Such questions of law are stated to be as follows: "1.What should be the true scope and ambit of the expression 'production of any one or more of the articles', appearing in section…

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