Fixed capital investment under trade tax law includes bottles used in manufacture, but not crates used only for marketing finished goods.

Section 4-A of the U.P. Trade Tax Act was construed purposively to promote industrial investment, and "fixed capital investment" was read to include apparatus, equipment and components necessary for the establishment or running of the factory. Bottles used in bottling soft drinks were treated as an essential part of the manufacturing process and therefore includible in fixed capital investment for exemption purposes. Crates, however, were regarded as used only for storage, marketing and transport of finished goods after manufacture, and were not includible. The exemption was thus available for bottles but not for crates.

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Issues: Whether the value of bottles and crates used in the manufacture and marketing of soft drinks could be included in the assessee's fixed capital investment for the purpose of exemption under Section 4-A of the U.P. Trade Tax Act.

Analysis: The exemption scheme under Section 4-A was intended to promote industrial investment and production, and the expression "fixed capital investment" was to be construed in a purposive and liberal manner. Equipment, apparatus and components necessary for the establishment or running of the factory could fall within that expression. Bottles used for bottling the soft drinks were held to be an essential part of the manufacturing process and therefore an investment forming part of fixed capital investment. Crates, however, were treated as used only for marketing and transport of the sealed products after manufacture, and not for running the factory or for the manufacturing process itself.

Conclusion: The value of bottles was held includible in fixed capital investment and entitled to exemption, while the value of crates was held not includible.

Final Conclusion: The appeal succeeded only in part, with relief confined to exclusion of crates and confirmation of inclusion of bottles for exemption purposes.

Ratio Decidendi: Under Section 4-A, only those apparatus, equipment or components that are necessary for the establishment or running of the factory can be included in fixed capital investment; articles used merely for storage or marketing of finished goods cannot be so included.

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