2000 (7) TMI 211

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....ook the following ground in this appeal: 'The learned Commissioner of Income-tax (Appeals) was not justified in directing the Assessing Officer to collect date to come to a finding whether the appellant-company did carry on Tea blending operation using the stipulated number of employees and thereby fulfil the requirement of section 80-I(2)(iv) when such business of Tea blending did not come under the expression manufacture or processing of goods to be able to enjoy the benefit of section 80-I'. 4. To start the argument, the ld. D.R. relied on the order of the Assessing Officer and mentioned that the assessee is claiming deduction in respect of profit and gains from industrial undertaking under section 80-I but the assessee is not enga....

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....tea blending activities. The word "blending' is not defined in the Income-tax Act. However, the dictionary meaning of the blending is the mixing or the mixture. As per Websters 'Dictionary, "process" means "to subject to some special process or treatment, to subject (especially raw material) to a process of manufacture development or preparation for the market, etc., to convert into marketable form as livestock by slaughtering, grain by milling, cotton by spinning, milk by pasteurizing, fruits and vegetable.$ by sorting and repacking.' Similarly, it is defined in section 2(m) of Oil Industries Development Act. The jurisdictional High Court in the case of G.A. Renderian Ltd. discussed the word "process" used in the definition of the industri....

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.... the purpose of export does not constitute manufacture of articles within the meaning of section 2(5)(a)(ii) of the Finance Acts, 1966 and 1967. Therefore, a company engaged in such activity is not an industrial company entitled to deduction as per provisions of section 2(5)(a)(ii)." 7. The jurisdictional Calcutta High Court dealt with section 80-I(4) specifically in the case of Appeejay (P.) Ltd v. CIT [1994] 206 ITR 367 where the words "manufacturing and productions" pertaining to blended tea were discussed. Finally, the Hon'ble High Court observed in that case that the assessee is merely mixing up and blending tea and sold them in the market. The processing of tea did not involve manufacturing of any article or thing. The input and ou....