COMMISSIONER OF WEALTH TAX Vs. PANNA DEVI DALMIA

JUDGEMENT

(1.) THIS is a reference under Section 27(1) of the Wealth-tax Act, 1957 (hereinafter called "the Act"). The question referred for our opinion is whether a cold storage is "an industrial undertaking" and reads as follows :

(2.) IN this reference, we are concerned with the assessment year 1973-74, The assessee is an individual. She (for, the assessee is a lady) had invested large amount in a firm, M/s Vishnu Cold Storage. The value of her holdings was to the tune of Rs. 1,50,000. The Wealth-tax Officer intended to include the value of her holdings in the cold storage for the purpose of reckoning her liability under the Act. The assessee contended that her interest in the cold storage was not liable to be included in terms of Section 5(1)(xxxii) of the Act. The Wealth-tax Officer rejected her claim. She, however, succeeded before the Appellate Assistant Commissioner and the Appellate Tribunal. Hence, the reference at the instance of the Revenue.

(3.) THE very question which has fallen before us fell for consideration before a Bench of the Allahabad High Court in Addl. CIT v. Farrukhabad Cold Storage (P.) Ltd. [1977] 107 ITR 816. THE precise question raised there was whether a cold storage was an "industrial company". In that connection, the provisions of Section 2(7)(d) of the Finance Acts of 1966 and 1967, according to which the word "industrial company" means a company which is mainly engaged in the business of generation or distribution of electricity or any other form of power or in the construction of ships or in the manufacture or Processing of goods or in mining fell for consideration. THE expanse of the word "processing" thus had to be considered. In that connection, their Lordships referred to the observations of Lord Cameron in the case of Kilmarnock Equitable Co-operative Society Ltd. v. IRC [1966] 42 TC 675 (C. Sess), where it had been observed at page 685: