TMI Blog1979 (8) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... rned counsel for the assessee and the departmental representative. To understand as to what exactly the assessee was doing, we asked the assessee that note be submitted to us to explain the activities of the assessee's coffee curing works. Accordingly, a note has been submitted which reads as follows: "We are agents of the Coffee Board. We receive coffee from the planters and it has to be cured as per the standard fixed by the Coffee Board. After the Coffee is received from the Planters, the Coffee should be taken for curing after it is properly dried as per standard weight fixed by the Coffee Board. The machinery used for curing will be about 20 in numbers from the initial stage to the final products. Even though the finished product ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the hearing, no challenge to the correctness of the statements made in this note was made by the learned departmental representative although a specific opportunity was given to the Department. We, therefore, take it as established that what is stated above is what is begin done by these in its curing works to the coffee received by it from the planters. The learned counsel for the assessee has relied on a number of ruling to establish his contention that it is engaged in the manufacture or production of goods. Reliance has been placed on State of Punjab Ors. vs. Chandulal Kishorilal etc.(1) wherein the Supreme Court has held that ginning process employed to separate cotton and seeds from the kapas or unginned cotton is a manufacturing pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t necessarily mean that the materials with which the commodity is to manufactured must lose their identity. Thus, both the words 'manufacture' and 'produce' apply to the bringing into existence of something which is different from its component. 4. Applying these rulings to the activity of the assessee, it is, in our opinion, quite clear that the assessee is engaged in the manufacturing or production of goods. If dehiscing the paddy for removing the husk is a process of manufacture, then the dehiscing coffee by removing the husk by peeler as is clear from the note extracted above would be a process of manufacturing. That apart, as is stated in the note, there are about 20 machines involved in the curing of coffee and what is done by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could be the business of the company to become an industrial company and it was necessary that he company itself must do the processing of goods. That case has no bearing because in the instant case, we are concerned wit the question whether the assessee is engaged in production or manufacturing of goods and not of processing. There can be little doubt that the assessee is engaged in processing of goods but that does not help the Department's case in any manner since we have held that it was engaged in the manufacturing or production of goods. We, therefore, hold that the assessee is engaged in production or manufacturing of goods and allow the appeal and direct allowance of initial depreciation under s. 32(1)(vi) of the IT Act, 1961. - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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