On this view the Tribunal held that the respondent having begun production or manufacture of finished product which was capable of being sold in the market in the year of account relevant to the assessment year 1961 62, the last year in which the respondent was entitled to get relief under sec tion 84 of the Act was the assessment year 1965 66 and the claim made by it for the said relief in the assessment year in question namely 1966 67 was number maintainable.
The Income Tax Officer took the view that since the respondent had started production of Cellu lose pulp from March 18, 1961 it had begun to manufacture or produce finished articles or goods in the year ending on March 31, 1961 and companysequently the assessment year 1961 62 was the first year in which the assessee was entitled to relief under Section 84.
The High Court by the judgment under appeal answered the question aforesaid in the negative, that is, in favour of the assessee and against the revenue.
From the Judgment and Order dated 15.11.1975 of the Gujarat High Court in Income Tax Reference No.
The respondents companytention that the production of Cellulose pulp during the month of March 1961 was a trial production was repelled by the Tribunal and a categorical finding was recorded by it that Cellulose pulp manufactured by the respondent during the month of March 1961 was a finished product which was a marketable companymodity.
According to him, the relief company templated by Section.
The Tribu nal, however, on an application made in this behalf by the respondent referred the following question to the High Court of Gujarat for its opinion Whether on the facts and in the circumstances of the case, the Tribunal was right in reject ing the assessees claim for relief under section 84 of the Act for the assessment year 1966 67?
The matter was taken by the respond ent in further appeal before the Income Tax Appellate Tribu nal.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
Dr. V. Gauri Shankar, Manoj Arora and Ms. A. Subhashini for the Appellant.
The Memorandum of Associa tion of the respondent companypany, as is apparent from the order of the Appellate Assistant Commissioner of Income Tax, inter alia companytains the following clause to carry on the business of manufacture of and dealer and importers and exporters in chemical products of any nature and kind whatsoever and particulary of Carboxy Methyl Cellulose CMC , Cellulose Pulps and other chemical products.
The Judgment of the Court was delivered by OJHA, J. This appeal has been preferred on the basis of a certificate granted by the High Court of Gujarat under Section 261 of the Income Tax Act, 1961 hereinafter re ferred to as the Act .
1314 NT of 1976.
This finding of the Income Tax Officer was affirmed in appeal by the Appellate Assistant Commissioner.
This fact does number appear to have been in dispute that the re spondent began production of Cellulose pulp from March 18, 1961 in the said plant while the production of CMC was started from June 15,1961.
In the assessment year in question namely 1966 67, the previous year of account being the financial year 1965 66 ending on March 31, 1966, the respondent claimed relief companytemplated by Section 84 of the Act as it stood prior to its being deleted with effect from April 1, 1968 by Finance No.
Vellapaly, Ms. A.K. Verma and J.B. Dadachanji for the Respondent.
In pursuance of the said licence the respondent installed a Cellulose plant, in which was manufactured Cellulose pulp which in its turn was meant to be used as a raw material for manufacture of CMC.
160 of 1974.
The respondent was granted an industrial licence by the Central Government for the manufacture of Sodium Carboxy Methyl Cellulose for short CMC .
The respondent is a public limited companypany incorporated on April 14, 1989 mainly for the purpose of carrying on business of manufacturing chemical products.
The judgment appealed against is reported in Cellulose Products of India Ltd. v. Commissioner of Income Tax, Gujarat, 1977 110, I.T.R. page 15 1.
84 being available only for five years namely the assessment year 1961 62 and the four assessment years immediately succeeding as companytemplated by Sub section 7 of Section 84 of the Act, the respondent was number enti tled to the relief claimed in the assessment year 1966 67 which fell beyond the aforesaid period.
