TMI Blog1996 (2) TMI 131X X X X Extracts X X X X X X X X Extracts X X X X ..... of the First Schedule. Item No. 2 in clause (c) is "fertilisers", the same as in item No. 18 of the First Schedule. Similarly, item No. 3 in clause (c) is "photographic raw film and paper", the same as item No. 20 in the First Schedule. Item No. 4 in clause (c), however, refers only to sub-item (2) of item No. 23 in the First Schedule but not to other sub-items. Item No. 4 in clause (c) reads : " Textiles (including those dyed, printed or otherwise processed) made wholly or in part of jute including jute twine and rope." Similarly, item No. 5 in clause (c) refers to sub-item No. (2) of item No. 24 of the First Schedule and item No. 6 in clause (c) refers to sub-item (5) of item No. 24. In all cases, however, the description of articles is i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce Act, 1967, read with item No. 28 of the First Schedule to the Industries (Development and Regulation) Act, 1951, for the assessment year 1967-68 ?" With a view to encourage export of industrial goods, the Finance Acts of 1966 and 1967 provided an additional incentive. A person engaged in the manufacture of any articles in an industry specified in the First Schedule to the Industries (Development and Regulation) Act, 1951 ("I. D. R. Act"), and who has exported such articles out of India or has sold the said articles to an exporter was entitled to an additional deduction specified in sub-clauses (ii) and (iii) of clause (a) of section 2(5) of the Finance Act, 1966, and section 2(4) of the Finance (No. 2) Act, 1967. The relevant provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... les in an industry specified in the said First Schedule and has, during the previous year, sold such articles to any other person in India who himself has exported them out of India, and evidence is produced before the Income-tax Officer of such articles having been so exported, the assessee shall be entitled to a deduction, from the amount of income-tax with which he is chargeable for the assessment year, of an amount equal to the income-tax calculated at the average rate of income-tax on a sum equal to two per cent. of the sale proceeds receivable by him in respect of such articles from the exporter.... (c) Nothing contained in sub-clause (ii) or sub-clause (iii) of clause (a) shall apply in relation to-- (1) fuels, (2) fertilise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and not to industries and since de-oiled cake is not mentioned in clause (c), the assessee is entitled to additional deduction. The Tribunal affirmed the said view in appeal. At the instance of the Revenue, the Tribunal referred the aforesaid two questions under section 256(1). The only question that arises in these appeals is whether clause (c) refers to articles mentioned therein or whether it refers to industries engaged in the manufacture of those articles. For answering this question, we have to turn to the scheme underlying the provisions aforementioned. Sub-clauses (ii) and (iii), which provide the additional deduction, speak of the articles manufactured in "an industry specified in the First Schedule to the I. D. R. Act", which h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e like)." Now, clause (c) adheres to the said pattern. Where it seeks to refer to the entire item in the First Schedule, it does so and where it seeks to refer only to a particular sub-item of an item in the First Schedule, it says so--and the description is identical. To wit, item No. 1 in clause (c) is "fuels", the same as the heading of item No. 2 of the First Schedule. Item No. 2 in clause (c) is "fertilisers", the same as in item No. 18 of the First Schedule. Similarly, item No. 3 in clause (c) is "photographic raw film and paper", the same as item No. 20 in the First Schedule. However, when it comes to item No. 4 in clause (c), it covers only a sub-item of item No. 23 in the First Schedule. Item No. 23 of the First Schedule "Textil ..... X X X X Extracts X X X X X X X X Extracts X X X X
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