TMI Blog1997 (2) TMI 18X X X X Extracts X X X X X X X X Extracts X X X X ..... question of law under section 256(1) of the Income-tax Act, 1961, for the opinion of this court : "Whether, on the facts and in the circumstances of the case, the Tribunal's view that the assessee is an industrial company engaged in the manufacture of goods within the meaning of section 2(7)(c) of the Finance Act, 1979, and, consequently, entitled to lower rate of tax is sustainable in law ?" ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs were working under the direction of the assessee-company. He, therefore, came to the conclusion that there was a supervisory control or direction by the assessee over the weavers and so, the assessee should be regarded as an industrial company and eligible to lower rate of tax, which is applicable for an industrial company. The Revenue preferred a further appeal to the Tribunal, which following ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as merely dyeing the yarn and giving it to the weavers and, hence, the assessee cannot be considered to be engaged in the manufacture or processing of the goods. Mr. Janarthana Raja, learned counsel appearing for the assessee, on the other hand, brought to our notice the finding of the Tribunal where the Tribunal has held that after purchase of the yarn and chemicals by the assessee, the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has clearly found that the assessee purchased yarn, dyed it and gave it to the weavers, and the weavers, under the supervisory control and direction of the assessee, wove the bed sheets and towels and as such, the activity of the assessee would amount to "processing" attracting the provision of section 2(7)(c) of the Finance Act, 1979. Section 2(7)(c) of the Finance Act, 1979, makes a distinction ..... X X X X Extracts X X X X X X X X Extracts X X X X
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