Appeal Dismissed: Glass Polishing & Crystal Assembly Deemed Manufacturing

The Court dismissed the appeal filed by the revenue under Section 260-A of the Income Tax Act, 1961, upholding that the assessee's activities constituted manufacturing despite involving polishing crystals and assembling glass and crystals. The Court relied on a previous judgment where a similar question was addressed, ruling in favor of the assessee and against the revenue's contention that the process did not bring anything new into existence. The Court affirmed that the activities qualified as manufacturing under the Income Tax Act, 1961.

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Issues:
Interpretation of manufacturing activities under the Income Tax Act, 1961.

Analysis:
The appeal under Section 260-A of the Income Tax Act, 1961 was filed by the revenue, questioning whether the assessee's activities constituted manufacturing. The Tribunal had held that the assessee was engaged in manufacturing activities, despite the process involving only polishing crystals and assembling glass and crystals. The revenue contended that this process did not bring anything new into existence, citing a Supreme Court case that differentiated between processing and manufacturing. However, the matter was jointly submitted by the parties that the substantial question of law had already been answered in a previous judgment by the Court.

The Court referred to a previous judgment dated 19.01.2015 in a related case (ITA No.351/2009 c/w ITA No.352/2009), where the substantial question of law had been addressed. In line with the reasoning and decision provided in the previous judgment, the Court concluded that the substantial question of law in the present appeal was to be answered against the revenue and in favor of the assessee. Consequently, the appeal was dismissed, upholding the view that the assessee's activities could be considered as manufacturing under the Income Tax Act, 1961.

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