COMMISSIONER OF WEALTH TAX Vs. ANNAI JAYABARATHI M

JUDGEMENT

(1.) AT the instance of the Department, the Tribunal referred the following question for the opinion of this Court under s. 27(1) of the WT Act, 1957 :

(2.) THESE tax cases arise out of the orders passed by the Tribunal in the wealth-tax assessments made on the assessee for the asst. yrs. 1975-76 and 1977-78. The assessee is a partner in the firm of M. M. Nagalinga Nadar, Virudhunagar. In filing the WT returns the assessee claimed exemption of the value of her interest in the said firm under s. 5(1)(xxxii) of the WT Act, 1957, claiming that the said firm was an industrial undertaking and that, therefore, the value of her interest in the said firm was exempt from the levy of wealth-tax. The claim was rejected by the WTO on the ground that the plant and machinery for crushing groundnut kernels were not owned by the firm nor did the firm carry on any crushing operation on its own for extracting oil; but the firm merely purchased groundnut kernels and after decortication got them crushed and the oil extracted by paying labour charges to other firms and as it did not carry on any manufacturing operation or processing, the firm could not be said to be an industrial undertaking within the meaning of s. 5(1)(xxxii) of the WT Act.

(3.) SEC. 5(1) of the WT Act states that :