TMI Blog1971 (11) TMI 11X X X X Extracts X X X X X X X X Extracts X X X X ..... h was deleted by the Finance (No. 2) Act, 1967, with effect from the 1st April, 1968. At the instance of the assessee, Chembra Peak Estates Ltd Coimbatore, the Income-tax Appellate Tribunal, Cochin Bench. referred under section 256(1) of the Income-tax Act, 1961, the following question : " Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee was not entitled to relief under section 84 of the Income-tax Act, 1961 ? " The assessee is a public limited company owning tea and coffee plantations in Wynad District. During the previous year ending March 31, 1964, relevant to the assessment year 1964-65, the assessee claimed rebate under section 84(1) of the Income-tax Act, 1961, on a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence depends on the interpretation of section 84 of the Income-tax Act, 1961, it will be appropriate to extract the relevant portions of the provision. It reads : " Income of newly established industrial undertakings or hotels.- (1) Save as otherwise hereinafter provided, income-tax shall not be payable by an assessee on so much of the profits and gains derived from any industrial undertaking or business of a hotel or from any ship, to which this section applies, as does not exceed six per cent. per annum on the capital employed in such undertaking or business or ship, computed in the prescribed manner. (2) This section applies to any industrial undertaking which fulfils all the following conditions, namely : (i) it is not formed by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant for our discussion and they are not extracted. The controversy between the parties is about the meaning to be given to the expression "industrial undertaking" in the above section. According to the department, in the circumstances of this case, the establishment of a new factory at Elstone division cannot, be considered to be a new industrial undertaking within the meaning of section 84(1) of the Income-tax Act, 1961. Prior to the accounting year ending with 31st March, 1964 the assessee was having the factory for the manufacture of tea only in the Chembra Peak division. During the previous year ending with 31st March, 1964, the assessee established a new factory in Elstone division employing a new process known as C.T.C. process (c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 84 defines the nature of an industrial undertaking for which the concession can be claimed. An assessee to get the benefit has to clearly establish that the income sought to be taxed in his hands has its source from an industrial undertaking. It was ruled in Commissioner of Income-tax v. Standard Motor Products of India Ltd. a case dealing with section 15C of the Indian Income-tax Act, 1922, that the exemption under the said provision will have to be strictly construed. The marginal note or title of section 84(1) reads: "Income of newly established industrial undertakings or hotels." The words "newly established" are not in the section, but in our view, that cannot in any way affect the interpretation to be placed on the said pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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