Assessee was engaged in the business of conversion of jumbo rolls of photographic films into small flats and rolls of desired sizes. Assessee claimed deduction under sections 32AB, 80HH and 80I of the Income-tax Act,\u00a0 1961 taking a stand that the aforesaidactivity amounted to manufacture or production.<\/p>\n
\u00a0<\/p>\n
What is the meaning of the term \u2018manufacture\u2019 and \u2018production\u2019 and whether conversion of jumbo rolls of photographic films into small flats and rolls amounts to manufacture or production<\/p>\n
\u00a0<\/p>\n
Supreme Court held that conversion of jumbo rolls of photographic films into small flats and rolls of desired sizes amounted to manufacture or production. Supreme Court took into account the dictionary meanings and earlier decisions\u00a0 and observed thatmanufacture implies a change but every change is not manufacture. Manufacture is a transformation of an article which is commercially different from the one which is converted. Supreme Court further took into account its decision in\u00a0 CIT v.\u00a0 SesaGoa (2004) 271 ITR 331 (SC) <\/em><\/strong>where it\u00a0 was held that the word \u2018production\u2019 had a wider connotation than the word\u2018manufacture\u2019 and that \u2018production\u2019 meant bringing into existence new goods by a process which may or may not amount to \u2018manufacture\u2019. Consequently, Supreme Court allowed the assessee\u2019s claim for deduction under sections 32AB, 80HH and 80I. (CA Nos3649-3650 of 2003\/, 6835-6836 of 2005\/, 1522 & 3720 of 2007 and<\/p>\n 451-452 of 2008 dt. 12-11-2008)<\/p>\n Editorial<\/em><\/strong>: Finance (No. 2) Act, 2009 introduced section 2(29BA) in the Act to define the term \u2018manufacture\u2019 to mean a change in a non-living physical object\u00a0\u00a0\u00a0 \u00a0or article or thing \u2013 (a) resulting in transformation of the object or article or\u00a0 thing into a new anddistinct object or article or thing having a different name,<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n character and use; or (b) bringing into existence of a new and distinct object or article or thing with a different chemical composition or integral structure. Though the term \u2018manufacture\u2019 is now defined in the Act the term \u2018production\u2019 remains undefined \u2013 and as held by several decisions, the term \u2018production\u2019 has a wider connotation than the term \u2018manufacture\u2019.<\/p>\n \u201cTo give pleasure to a single heart by<\/em><\/p>\n a single act is better than a thousand heads bowing in prayer.\u201d<\/em><\/p>\n – Mahatma Gandhi<\/p>\n","protected":false},"excerpt":{"rendered":" S. 80HH: Newly established industrial undertakings \u2013 Backward areas \u2013 Manufacture \u2013 Conversion of Jumbo rolls into small flat and rolls amounts to manufacture . [S. 2(29B), 32AB ,80I]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-13382","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-3tQ","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/13382","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=13382"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/13382\/revisions"}],"predecessor-version":[{"id":13383,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/13382\/revisions\/13383"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=13382"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=13382"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=13382"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}