TaxTMI 
TaxTMI 
1988 (4) TMI 40
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....7, is at the instance of the Commissioner of Wealth-tax, Jaipur, to decide the following question of law, namely: " Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that M/s. Vimal Gems and M/s. Jus Gems are industrial undertakings within the meaning of the Explanation to section 5(1)(xxxi) read with clause (xxxii) of the Wealth-tax Act, 1957, and the assessee being a partner is entitled to exemption under section 5(1)(xxxii) of the said Act in respect of his interest in the assets of these partnership firms ? " The relevant assessment year is 1977-78. The assessee claims to be an " industrial undertaking " within the meaning of the Explanation to clause (xxxi) of sub-section (1) of sec....
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....usiness of purchasing rough emerald from local market and then convert it into tawdda, potta and cut emerald by processing. It is said that in this process, rough emeralds are sorted out, converted into ghats and finally shaped, polished and coloured and that manufacturing is got done through skilled labourers who are paid on the basis of work done. The assessee contended that the firms of which he is a partner manufacture and process emerald and this activity make them " industrial undertakings " entitled to the benefit of section 5(1)(xxxii) read with the Explanation to section 5(1)(xxxi) of the Act. The Tribunal has held in the assessee's favour on these findings alone. Learned counsel for the Revenue contended that there is no findin....
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....ings of fact recorded by the Tribunal in all the connected matters is similar and, therefore, our decision in all of them is the same. It is obvious that for getting the benefit of section 5(1)(xxxii) of the Act and construing the expression " industrial undertaking " as defined in the Explanation to section 5(1)(xxxi), the existence of the ingredients of these provisions have to be proved by the assessee. It is equally obvious that the corresponding finding of the existence of these ingredients had to be given by the Tribunal before it gave the assessee this benefit. The Tribunal's decision to give this benefit without recording the requisite findings of fact which attract the applicability of the provision cannot, therefore, be justifi....
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....facture or processing of these gems beginning with the point where the same was purchased in the local market and ending with the point where it was made marketable and sold by the assessee's firms. It has then to be further found as to which, if any, of the various steps or stages of this manufacture or processing activity between these two end points is performed by the assessee's firms directly so as to be treated as being done by the assessee's firms themselves and also whether the activity got done through the skilled labourers who are paid on the basis of work done is an activity of the firms themselves and not of an outside agency. For this purpose, the jural relationship between the assessee's firms and these skilled labourers has t....
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....cessing activity. Without these findings of fact, it is not possible to decide the question of applicability of the statutory provision, of which the assessee has claimed the benefit. In view of the above, we consider it appropriate to require the Tribunal to decide the matter afresh with advertence to the observations contained herein. Merely calling for an additional statement of case will not solve the difficulty because the entire matter is required to be re-examined and in the circumstances of the case, the parties have also to be given an opportunity to produce further material, if they so desire to enable the Tribunal to record its findings. It is clear that as a result of misapprehension of the requirements of these statutory pro....