Law: Wealth Tax Act, 1957

Section: 5(1)(xxxii)

Wealth tax-----Exemption---Firm---Partner---Industrial undertaking---Condition precedent--- Manufacture of article---Firm purchasing silk yarn and getting cloth manufactured by weavers who on own machines wove the material supplied by assessee---Firm was not an industrial undertaking--­Partner not entitled to exemption under S.5(1)(xxxii)---Indian Wealth Tax Act, 1957, S.5(l)(xxxii). The relief unction 5(1)(xxxii) of the Wealth Tax Act, 1957, is required to be given in respect of industrial undertakings which includes manufacture processing. Unless such manufacture processing is done by the firm of which the assessee is a partner, the benefit under section 5(1)(xxxii) of the Act cannot be claimed. The assessee was a firm which purchased articles like silk yarn and got silk cloth manufactured through weavers and then sold the cloth on its own account. The firm made use of the facilities owned by the weavers who on their own machines wove the material supplied the assessee and received the consideration for that service from the assessee for making the finished products from the materials supplied by the assessee. The assessee had chosen to characterise these payments as wages to the weavers. The partners of the firm claimed exemption under section 5(1)(xxxii): Held, that the role of the assessee was limited to procuring the material and making it available to the weavers and thereafter, effecting sale of the finished product. The activity of manufacture was not done by the assessee. The partners of the firm were not entitled to exemption under section 5(1)(xxxii). JUDGMENT R. JAYASIMHA BABU, J.---The question referred to us at the instance of the Revenue is: "Whether, on the facts and circumstances of the case, the firm which gets the articles manufactured through others could be regarded as an industrial undertaking for the purpose of section 5(1)(xxxii) of the Wealth Tax Act, 1957?" The assessment years are 1973-74 to 1978-79. Section 5(1)(xxxii) of the Wealth Tax Act, 1957, refers to industrial undertaking which is defined in the Explanation to it as including, inter alia, the…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492