1968 (4) TMI 19

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....tax Act, 1922, which is allowable to a newly established industrial undertaking. The same claim had also been made by the assessee in respect of the assessment of the immediately preceding year, 1959-60, and such claim had been refused originally by the Income-tax Officer on the ground that rice milling is not an industrial undertaking within the meaning of section 15C of the said Act. The assessee had preferred an appeal against the said order to the Appellate Assistant Commissioner in respect of the said assessment for 1959-60. The Appellate Assistant Commissioner had directed that the Income-tax Officer should allow the benefit under section 15C to the assessee provided the requisite conditions as laid down in that section were fulfilled....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....fore the Appellate Assistant Commissioner who upheld the order of the Income-tax Officer ; The assessee preferred an appeal before the Income-tax Appellate Tribunal. The Tribunal accepted the position that under section 15C(2) of the Income-tax Act of 1922, if an industrial undertaking had been formed by the transfer to the new business of such machinery or plant which had already been used in a business which was being carried on before the 1st April, 1948, the exemption would not be applicable, but at the same time the Tribunal interpreted the word "transfer" to be a transfer of a going concern by one to the other and not purchase in the open market. The Tribunal was, therefore, of the opinion that the assessee was entitled to the benef....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....of power, or employs twenty or more workers in a manufacturing process carried on without the aid of power ..........." The only question that requires consideration is whether purchase of one second-hand steam engine by this industrial undertaking disentitles it to exemption under clause (i) of sub-section (2) of section 15C of the said Act. The scheme of this section is to encourage new industrial undertakings provided they fulfill the conditions mentioned in the various clauses of the sub-section. It is true that in order to be entitled to exemption an assessee must strictly come within the terms of the provision under which such exemption is being claimed, but in construing the provisions of this section one must construe the said sect....