COMMISSIONER OF INCOME-TAX Vs. SESA GOA LTD

JUDGEMENT

(1.) ALL these appeals are being disposed of by a common order as the same question of law arises in them, except for the amounts. The question of law as formulated by the Department reads as under :

(2.) IT is not necessary to refer to all the previous orders, except that the Income-tax Appellate Tribunal in appeal filed by the Deputy Commissioner of Income-tax against M/s. D. B. Bandodkar and Brothers on the issue of investment allowance had relied on the judgment of the Karnataka High Court in the case of CIT v. Gogte Minerals (No. 2) [1997] 225 ITR 60, wherein a Division Bench of the Karnataka High Court had held that mining operations being carried out for excavating iron ore, amount to manufacture.

(3.) IT is the contention on behalf of the Revenue that extracting/raising of iron ore does not amount to manufacturing activity and, consequently, such an assessee would not be entitled to the benefit under Section 32a of the Income-tax Act, 1961 (hereinafter referred to as "the said Act" ). It is then contended that reliance placed on the judgment of the Division Bench of the Karnataka High Court, was misplaced as the apex court in the case of CIT v. N. C. Bud-haraja and Co. [1993] 204 ITR 412 has explained what is "manufacture" and "production". These tests as explained by the apex court had not been considered by the learned Division Bench of the Karnataka High Court in the case of CIT v. Gogte Minerals (No. 2) [1997] 225 ITR 60. It is further pointed out that the apex court in CIT v. Mysore Minerals Ltd. [2001] 247 ITR 301, has set aside the order therein and the High Court has been directed to refer the issue for decision. In those circumstances, it is set out that the issue does not stand concluded and, consequently, the issue is open for consideration. It is also pointed out that there are judgments of other High Courts, which judgments had not been taken into consideration and, in these circumstances, it is pointed out that the appeals filed by the Revenue should be allowed.