COMMISSIONER OF INCOME TAX Vs. BARAKA OVERSEAS TRADERS

JUDGEMENT

(1.) UNDER s. 256(1) of the IT Act, 1961, ('the Act' for short) the following questions have been referred for our consideration in respect of the asst. yr. 1982-83 :

(2.) THE relevant facts are that the assessee deals in marine products for the purpose of exports. It processes the marine products, freezes and thereafter packs the same as per export specifications. THE assessee also buys meat in the market and subjects the same to several processes such as cleaning, removing bones and fat through chemical and scientific method; bifurcating chunks, trimming and finally packing the same in a fit condition for export market. THE assessee uses machineries for this purpose.

(3.) THE above decision is mainly concerned with the concept of consumption under the provisions of the Kerala General ST Act. Here we are concerned with the provisions of s. 80HH of the IT Act. THE question is whether the assessee is an industrial undertaking and employs 10 or more workers in a manufacturing process carried on with the aid of power, etc. This section came up before the Kerala High Court in almost similar circumstance in CIT vs. Marwell Sea Goods . Having regard to the purpose behind the provision the relevant terms were construed by the High Court so that its beneficial provision could be availed of by a deserving assessee. At page 627 the Bench observed :