Section 80J turns on who operates the undertaking, while seafood processing was not treated as manufacture for relief.

Deduction under section 80J depended on the factual finding that the assessee itself operated the cold storage undertaking through its own men and machinery under an agreement with a sister concern, and relief was sustained on that basis. Processing of sea foods was held not to amount to manufacture or production of articles for section 80HHA, following an earlier decision in the assessee's own case, so relief under that provision was denied. The reference was thus answered partly in favour of the assessee and partly in favour of the Revenue.

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Issues: (i) Whether the assessee was entitled to deduction under section 80J of the Income-tax Act, 1961 when the cold storage plant was operated with its men and machinery for a sister concern. (ii) Whether processing of sea foods amounted to manufacture or production of articles so as to entitle the assessee to relief under section 80HHA of the Income-tax Act, 1961.

Issue (i): Whether the assessee was entitled to deduction under section 80J of the Income-tax Act, 1961 when the cold storage plant was operated with its men and machinery for a sister concern.

Analysis: The Tribunal's finding was that the assessee itself operated the cold storage facility through its own men and machinery under an agreement with the sister concern, which paid for the work done. The issue turned on the factual finding as to who carried on the operation of the undertaking.

Conclusion: The assessee was entitled to relief under section 80J; the finding was in favour of the assessee and against the Revenue.

Issue (ii): Whether processing of sea foods amounted to manufacture or production of articles so as to entitle the assessee to relief under section 80HHA of the Income-tax Act, 1961.

Analysis: The issue was covered by an earlier decision of the same court in the assessee's own case for an earlier assessment year, wherein the court had held against the assessee on the question whether such processing constituted manufacture or production of articles.

Conclusion: The assessee was not entitled to relief under section 80HHA; the issue was decided in favour of the Revenue and against the assessee.

Final Conclusion: The reference was answered partly in favour of the assessee and partly in favour of the Revenue, with deduction sustained under section 80J and denied under section 80HHA.

Ratio Decidendi: Eligibility for deduction under section 80J depends on the factual finding that the assessee itself operated the industrial undertaking, while processing of sea foods was not treated as manufacture or production of articles for section 80HHA on the authority of the earlier binding decision.

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