TMI Blog1998 (6) TMI 113X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee-company's claim of deduction under sections 80HH and 80-I of the Income-tax Act, 1961 ignoring the fact that the assessee-company is engaged in construction activities and is not an Industrial company which makes it entitled to such claims.' 2. Relevant facts are like this that the assessee-company is engaged in business of excavating and breaking boulder stones from stone quarries and supplying the same to Hindustan Construction Company for their work at Kolab (Orissa). Besides this the company's proprietary unit Saket Marble Udyog is engaged in the business of sawing and processing marble at Makrana (Rajasthan). During the course of assessment proceedings it has been observed by the Assessing Officer that assessee-company has cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te order for the year under reference that dumpers being road vehicles similar type of claim was dealt with by her in the appeal for assessment year 1984-85 in which it was held that from the use of dumpers as made in the case of the assessee, the dumpers cannot be termed as road vehicle. So in view of appellate order rendered for the assessment years 1984-85 and 1885-86 it was held that the assessee is entitled to investment allowance in respect of dumpers used in the business and the Assessing Officer was directed to allow the same as well as to entertain the claim of assessee under sections 80HH and 80-I subject to fulfilling other conditions laid down. 3. The revenue has come up in appeal against this order of the first appellate auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e that the assessee is not directly engaged in the activity of construction of a dam or any structure of similar nature in the Kolab Project and it in fact is engaged in the activity of mining, quarrying and crushing stones and it was supplying such crushed stones to the construction site and this fact has duly been noted by the learned CIT(A) in her earlier order which was followed in the impugned order. So case law as 'cited by the learned DR is not applicable to the facts of this case. As the assessee is not engaged in the activity of construction of immovable structure but is engaged in the activity of manufacturing article or things, which has been supplied to the construction site, would be entitled to investment allowance as well as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal for following the same in subsequent years gets vanished. Moreover excavation and breaking boulders stones from stone quarries does not bring into existence any new thing or article as stone remains stone because there is no transformation of a new or different article having a different name, character or use after it is excavated from the ground (earth). It is same commodity as it was in the ground. Though labour has been applied in taking it out. Therefore, it was pleaded that assessee's contention has no force and same are liable to be rejected because the assessee is in no way engaged in any manufacturing activity. Therefore, his claim for investment allowance and entitlement of deduction under sections 80HH and 80-I of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the case of Dy. CST v. PioFood Packers [1980] 46 STC 63 among other decisions. In the said decision test involved for determining whether 'manufacture' can be said to have taken place is whether the commodity which is subjected to the process of manufacture can no longer be regarded as the original commodity but is recognised in the trade as a new and distinct commodity. The expression "manufacture' has in ordinary acceptance a wide connotation. It means making of articles, or material commercially different from the basic components, by physical labour or mechanical process. The word 'manufacture' has various shades of meaning and if the goods to which some labour is applied remain essentially the same commercial article, it cannot be sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... articles known as identifiable articles known in the market as goods and marketed or marketable as such Collector of Central Excise v. Eastern Paper Industries Ltd [1989] SCC (Tax) 602; Bhor Industries Ltd v. Collector of Central Excise [1989] SCC (Tax) 98; Star Paper Mills Ltd v. Collector of Central Excise [1990] 76 STC 312 (SC) and Union Carbide India Ltd v. Union of India AIR 1985 SC 1097 are referable decisions. In the case in hand the assessee had been excavating and breaking boulder stones from stone quarries and supplying the same to Hindustan Construction Co. Ltd. The word 'excavation" means to make hollow by removing the inside to take out leaving hollow and the activity of digging and removing earth for excavation of boulder in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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