TMI Blog1999 (4) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacture or production of any article or thing as envisaged by section 32A(2)(b)(iii) of the Income-tax Act, 1961, and is entitled to 'investment allowance' in the assessment year 1980-81 ?" The assessee is a private limited company and carries on the business of "business consultants". As a part of its consultancy business, the assessee-company undertakes data processing work with the help of electronic computers. For this purpose, in the previous year ending on September 30, 1979, relevant to the assessment year 1980-81, the assessee-company acquired a computer and claimed investment allowance under section 32A of the Income-tax Act, 1961 (the "Act"), in respect thereof. The Income-tax Officer rejected this claim of the assessee on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not an office appliance and that the assessee's activity as consultants of processing data and preparing sale registers and other statements for its clients constituted manufacturing activity. We have heard Mr. R. V. Desai, learned counsel for the Revenue, who submits that the Tribunal committed a manifest error of law in arriving at the above conclusions. According to him, neither the activity of the assessee amounted to manufacturing activity nor did the assessee manufacture any article or thing. The assessee, according to learned counsel, is not an industrial undertaking. Its consultancy business is purely business or professional activity and the computer is an office appliance. We have carefully considered the above submissions. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as a deduction (whether by way of depreciation or otherwise) in computing the income chargeable under the head 'Profits and gains of business or profession' of any one previous year. (2) The ship or aircraft or machinery or plant referred to in sub-section (1) shall be the following, namely :--- (a) a new ship or new aircraft acquired after the 31st day of March, 1976, by an assessee engaged in the business of operation of ships or aircraft; (b) any new machinery or plant installed after the 31st day of March, 1976--- (i) for the purposes of business of generation or distribution of electricity or any other form of power; or (ii) for the purposes of business of construction, manufacture or production of any one or more of the arti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the above submission of the assessee. Admittedly, the assessee-company, is engaged in the consultancy business and as a part of its consultancy business, it undertakes data processing work which is done with the help of electronic computers. We do not find how the assessee in such a case can claim itself to be an industrial undertaking. Only because it is using computers in its consultancy business, it cannot be regarded as in industrial undertaking. Moreover, no article or thing is manufactured or produced by the company. Preparation of statements on the basis of the data processed by the assessee cannot amount to manufacture or production of any article or thing. The word "article" came up for interpretation before the Supreme Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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