TaxTMI 
TaxTMI 
1990 (4) TMI 82
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.... not legally entitled to the said allowance. The assessee company purchased tin plates, processed those plates, cut them, varnished them, sorted them, slit them and subjected them to what is called lacquering process and then sold them to the customers according to their requirements. The machinery used by the assessee is called Slitting-line machine and Varnishing-line machine. According to the learned C.I.T., the machinery was not utilised for any type of manufacturing process in the case of the assessee. There was no evidence of any manufacture or production of articles. What the assessee was engaged in was process of the metal sheets or tin sheets. The end-product is only slightly different as a result of various processes carried out b....
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....e of the assessee has objected to the order of the learned C.I.T. and argued that the order passed by the learned C.I.T. is without jurisdiction and in excess of his jurisdiction and the order is, therefore, bad in law. It has further been submitted that the assessee company was engaged in manufacture of lacquered strips which were used in packing industry. This manufacture is quite different and is distinctly known in the market than the raw material which was used for manufacture. In support of the argument, the learned authorised representative has filed a Paper Book containing, inter alia, a letter dated 16-12-1985 from Rajendra & Co., Chartered Accountants to the CIT, Bombay City IV, Bombay in response to notice u/s. 263 of the Income-....
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....nt. It has also been argued that the learned CIT has clearly brought out the nature of business of the assessee to establish that it was not engaged in the manufacture or production of an article or thing. The assessee was only processing articles or things and such activity does not amount to manufacture or production of an article or a thing. The learned senior Departmental Representative has further argued that the CIT is perfectly justified in passing order u/s. 263 of the Act and cancelling the assessment order of the ITO. To this proposition, reliance was placed on the decision of Hon'ble Supreme Court in the case of Smt. Tara Devi Aggarwal v. CIT [1973] 88 ITR 323 and the decision of the Delhi High Court in the case of Gee Vee Enterp....
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....of the assessee as discussed at length by the learned CIT, it is clear that the assessee was engaged in processing metal sheets or tin sheets and the end-product remains almost the same as the raw material used. Further we find at Sl. No. 10 of the Auditors' Report for the year ended 30th November, 1982 that "the company is a processing company, so it has no by-products and for realisable scrap reasonable records for its sale and disposal has been maintained". It is, therefore, clear that the assessee is a processing company as can be seen from the Auditors' Report reproduced above. As regards the judicial decisions relied upon by the learned counsel, we find that the facts of the present case are different and distinguishable from the fact....