MUDDEERESWARA MINING INDUSTRIES Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) IN these references, we are required to answer the following two questions referred under section 256(1) of the INcome-tax Act, 1961 ("the Act" for short) :

(2.) THOUGH one more question has been referred in I.T.R.Cs. Nos. 135 and 136 of 1992, pertaining to a claim towards business expenditure, no argument was addressed on the said question. Hence, we proceed on the basis that we are required to consider only the above two questions which are in substance the same question worded differently. A detailed reference to the facts is unnecessary. Admittedly, the assessee has been exporting granites. The question is whether the income earned from the export of granites is covered by section 80HHC of the Act. There is also no dispute that granite is covered by the terms "goods or merchandise" and, therefore, the business of the assessee in exporting granite would normally be covered by the beneficial provisions of section 80HHC of the Act. The Revenue has relied on sub-section (2)(B) of section 80HHC to contend that granite is a mineral and, therefore, the main provision of the said section is not attracted. As per clause (b) of sub-section (2), the main section is not applicable to "minerals and ores". We are concerned here with the assessment years 1985-86, 1987-88 and 1988-89.

(3.) THERE can be no dispute about the proposition that the terms used in a fiscal legislation describing the subjects of taxation are to be normally understood in their popular sense unless the law itself indicates a different approach. Scientific and technical meanings are to be attributed to those words only when the context requires such meanings to be given. The normal rule is to give that meaning which the parsons engaged in dealing with that subject-matter, attribute to that term, describing the subject. It is also true that a beneficial provision in a fiscal statute should be liberally construed to advance the purpose behind the legislation. But, in many of the cases, the problem is to find out the real purpose behind a particular provision.