TMI Blog1989 (2) TMI 178X X X X Extracts X X X X X X X X Extracts X X X X ..... e business of manufacture or production of frozen sea foods from shrimps obtained from the sea. The catch obtained from the sea was cleaned, beheaded, deskinned, sorted, frozen and was converted or produced into frozen sea foods which were exported in packs to foreign countries. Thus, the assessee's case was that the assessee was an industrial undertaking engaged in the business of manufacture or production of frozen sea food. The assessee claimed deduction under section 80HH of the I.T. Act, 1961. The I.T.O. allowed the said deduction in the original assessments. The CIT scrutinised the records of the ITO and came to a tentative conclusion to the effect that deduction under section 80HH had been wrongly allowed because the business of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion" the natural produce, i.e., the shrimps caught from the deep seas were converted into frozen fish and fish products and that by result of process carried on by the assessee, the commercial product came into existence. According to the learned CIT the real question was not considered in its proper perspective by the High Court and that the real question to be answered was whether the shrimps caught in the sea loses its identity after the processing by the assessee or still it continues to be called by the name of shrimps and since the answer was that even the final product was known as shrimp the finding that should have been recorded was that no new commercial article had come into existence as a result of processing by the assessee. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned CIT in his order. 5. We have considered the rival submissions. We find that sec. 80HH of the I.T. Act, 1961 allows deduction in respect of profits and gains from a new industrial undertaking in backward areas. The legislative intent is to encourage the industries in backward areas with a view to the progress of those areas. In sec. 80HH the words "manufacture" or "produce" appear. The same words appear in sec. 33 of the Act which relates to grant of relief of development rebate to the assessee. In sec. 33(1)(b)(B)(i) it is mentioned that development rebate at higher rates would be available in case of machinery or plant which are installed for the purposes of business of manufacture or production of any one or more of the article ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Calcutta and Kerala High Courts referred to above and also from the decision of the Special Bench of the Tribunal mentioned above. There is no decision of any High Court taking a contrary view as far as the provisions of sec. 80HH were concerned. Consequently, we are bound by the decisions referred to above. We cannot take a contrary view on the basis of the decision of the Supreme Court of United States of America referred to by the C.I.T. in his order. The Supreme Court of America was concerned with the dressed and frozen chicken and the view expressed was that the said article was not commercially distinct article from the original chicken. We have not to express our view in the abstract. We have to express our view in the context o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was necessary that the goods which were purchased by the assessee for the purposes of complying with the agreement or order for or in relation to such export, must be the same goods which were extracted out of the territory of India and that goods purchased by the assessee and the goods exported by him must be the same. The question which, therefore, arose for consideration of the Supreme Court was whether shrimps, prawns and lobsters purchased by the assessee could be regarded as the same articles when they are subjected to the process of cutting of heads and tails, peeling, deveining, cleaning and freezing before export. Thus, the context was entirely different. Consequently, the interpretation given on the question whether shrimps contin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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