TMI Blog1979 (3) TMI 95X X X X Extracts X X X X X X X X Extracts X X X X ..... f partnership in this firm, which was manufacturing handloom sarees, and as such this figure was represented the capital employed by the assessee in the said firm should be exempted under the above provision of law. The WTO, however, negatived this claim of the appellant, following the decision of the AAC, in the earlier years, wherein it was held that the firm did not own looms and in such, the assets did not form part of the Industrial undertaking eligible for exemption under s. 5(1) (xxxii) of the Act. 2. Aggrieved by this order of the WTO the assessee preferred an appeal to the AAC, who following the order of the Tribunal, Madras Bench 'A' for the earlier asst. years, allowed the assessee's appeal. It is from this order of the AAC tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed Chartered Accountant submitted that all the contentions urged by the Department were considered in the earlier years by the order of the Tribunal Madras Bench 'A' in WTA No. 319/MDS/75-76 and WTA No. 267/Mds/76-77 dt. 19th Jan.,1977 and that since the facts were identical, there was no merit in the Department's appeal. He further pointed out that the decision in 115 ITR 73 relied on by the Revenue was clearly distinguishable on facts and was hence inapplicable to the present case. He pointed out that in the case of the present assessee his partnership firm purchased art silk cones, which were cleaned by removing the cotton contents mixed in them and that this process was done by the assessee's own employees. He next urged that the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal for the earlier asst. yrs and submitted that the order of the AAC for the year under appeal should be upheld. He further relied on the decision of the Madras High Court in the case of CIT vs. Commercial Laws of India P. Ltd(4). Sri Santhanakrishnan pointed out that the High Court held in the case said that though the printing of the sheets was done by a different concern and therefore, there was no question of the assessee carrying on any 'manufacture' the folding and stitching of the printed sheets would constitute 'processing of goods' so as to fall within the scope of s. 2(6) (d) of the Finance Act. 1968 and that as the assessee was engaged in such processing, it would be liable to pay income-tax only as an industrial company. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clusion that they constitute business of manufacturing. The Tribunal ultimately held that the partnership firm in which the appellant is a partner is an industrial undertaking and the interest of the appellant in the assets forming part of the industrial undertaking and belonging to the partnership should be worked out in the manner provided under r. 2-1 of the WT Rules Following the above order of the Tribunal we set aside the order of the A.A.C and remit the case back to the file of the WTO to work out the value of the interest of the appellant in the manner provided under r.2-1 of the WT Rules." In our view, this decision completely answers all the arguments urged on behalf of the Revenue. 6. The decision in Addl. CIT vs. Chillies Ex ..... X X X X Extracts X X X X X X X X Extracts X X X X
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