COMMISSIONER OF INCOME TAX Vs. SARASWATHI V TMT

JUDGEMENT

(1.) AT the instance of the Department, the Tribunal referred the following question of law for the opinion of this Court under s. 256(2) of the IT Act, 1961 :

(2.) THE assessee, V. Saraswathi, was assessed to tax on the share income derived from Standard Appliances, Madurai, a firm carrying on the business in supply of gas cylinder processed by Indian Oil Company for domestic consumption. For the asst. yr. 1974-75, the assessee filed WT return claiming exemption under s. 5(1)(xxxii) of the WT Act (hereinafter referred to as "the Act") in respect of the share capital on the ground that the firm in which she is a partner has to be construed as an industrial company as defined in the Expln. 2 to s. 5(1)(xxxii) of the Act. THE WTO held that the firm in which the assessee is a partner is not an industrial undertaking engaged in the business of generation or distribution of electricity or any other form of power and that the firm is only carrying on a trading activity in purchasing and selling of gas cylinders and that, therefore, the assessee is not entitled to exemption.

(3.) WE have already stated, what is mentioned in Collins Cobuild English Language Dictionary. According to the Oxford Dictionary, "power" means vigour of energy, mechanical energy as opposed to hand labour, the capacity for exerting mechanical force. It is no doubt true that power would include any form of energy as commonly understood. But, power would not include source of power. Power can be generated through various sources. Coal, kerosene, oil and gas constitute source of power and they would not by themselves become power or energy. If it is power, it can be directly applied to get energy and if it is fuel, it should be oxidised for getting energy. Therefore, gas which is fuel cannot be considered as power as contended by the learned counsel for the assessee. Accordingly, we hold that the firm in which assessee is a partner, is not an industrial undertaking engaged in the distribution of power. In that view of the matter, the exemption under s. 5(1)(xxxii) of the Act cannot be granted to the assessee.