Processing activity in xerox-copy business qualified for wealth-tax exemption as supporting manufacturing-linked use of goods.

A partner in a firm making xerox copies was treated as entitled to exemption under section 5(1)(xxxii) of the Wealth-tax Act because the firm's activity was regarded as processing of goods. The work involved use of paper, machine, ink and chemicals to produce copies from photographs or originals, and on those facts it was held to fall within processing rather than a mere ancillary activity. The Gujarat High Court view treating similar printing activity as manufacture of goods was noted as supporting authority. On that basis, the claimed wealth-tax exemption was allowed.

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Issues: Whether the assessee, being a partner in a firm engaged in making xerox copies, was entitled to exemption under section 5(1)(xxxii) of the Wealth-tax Act on the ground that the firm was engaged in processing or manufacturing of goods.

Analysis: The activity carried on by the firm involved use of paper, machine, ink and chemicals to produce copies of photographs or originals. On these facts, the activity was held to fall within processing, and the decision of the Gujarat High Court treating similar printing activity as manufacture of goods was treated as supporting authority.

Conclusion: The assessee was entitled to the claimed exemption under section 5(1)(xxxii) of the Wealth-tax Act.

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