Criminal Appeal No 710 of 1991
From the Judgment and Order dated 291 1991 of the Delhi High Court in Cr
WP No 9 of 1991
BPajha and Manoj Prasad for the Appellant
VCMahajan SDSharma and SNTerde for the Respondents
The Judgment of the Court was delivered by SHARMA J
Special leave is granted
The appellant Havildar Ratan Singh was tried and convicted by Summary Court martial
He was reduced in rank and sentenced to suffer rigorous imprisonment for one year
He filed an application under Article 226 of the Constitu tion of India before the Delhi High Court which was dis missed by the impugned judgment
372 3
Although a number of questions were raised in the writ petition and the special leave petition the ground urged by the learned counsel for the appellant before us is confined to one point
It has been contended that having regard to the nature of the charge against the appellant the provisions of section 34 of the herein after referred to as the Act are attracted and in view of section 120 2 of the Act trial by summary not permitted
The learned counsel has placed the relevant provisions of the Act indicating that the appellant would have been enti tled to a qualitatively better right of defence before a court martial other than a summary court martial which was denied to him on a wrong assumption that the case was cov ered by section 36 and not by section 34
The question which arises in this case is whether the Summary Court Martial had jurisdiction to try the appellant in the facts as alleged in the present case
The charge sheet states that when fired upon by a group of terrorist militants during an armed operation against them the appellant quitted his place without orders from his superior officer
Section 120 of the Act states that subject to the provisions of sub section 2 of the section a summary court martial may try any offence punisha ble under the Act
Sub section 2 reads as follows  2 When there is no grave reason for immedi ate action and reference can without detriment to discipline be made to the officer empowered to convene a district court martial or on active service a summary general court martial for the trial of the alleged offender an officer holding a summary court martial shall not try without such reference any offence punishable under any of  the sections 34 37 and 69 or any offence against the officer holding the Court
 The position thus is that if the offence is covered by section 34 and immediate action for the specified reasons is not warranted the summary court martial shall not have jurisdiction to hold the trial
Section 34 states that any person subject to the Act who commits any of the offences enumerated thereunder shall on conviction by court martial be liable to suffer death or such less punishment as prescribed
The offences are detailed in 12 clauses and clauses a and h appear to be relevant in the present context
They are quoted below a shamefully abandons or delivers up any garrison fortress post place or guard committed to his charge or which it is his duty to defend or uses any means to compel or induce any 373 commanding officer or other person to commit any or the said acts or  h in time of action leaves his commanding officer or his postguard picquet patrol or party without being regularly relived or without leave or  6
The evidence in the case included in the paper book prepared by the appellant indicates that the appellant while engaged in an armed action against a group of mili tants is alleged to have run away when the militants opened fire and he thus in a cowardly manner left his post with out permission of his superior officer
The allegations included in the charge sheet on the basis of which the appellant was tried are also to the same effect
The appel lant is therefore right in his stand that if the prosecu tion case be assumed to be correct which he denies he was guilty of a more serious offence under clauses a and h of section 34 of the Act than under section 36
In reply it is contended on behalf of the respondents that the case is covered by section 36 and therefore the Summary Court Martial was fully authorised to try the appellant under section 120 1
There is no dispute that the appellant is governed by the provisions of the Act
It is also not suggested on behalf of the respondents that there was in existence any grave reason for immediate action so as to justify trial by an officer holding summary court martial
The Operation in which the appellant was engaged was directed against the militants who were undisputedly included in the expression enemy  within section 3x
The impugned order is attempted to be justified solely on the ground that section 36 covers the case
The argument overlooks the position that it is not the scope of section 36 which can answer the question raised in the present case
The issue is whether the offence is punishable under section 34 or not
Section 36 covers a wide range of offences and the scope of section 34 is limited to a smaller area where the offence is more serious attracting more severe punishments
If the allegations are assumed to be true then the appellant on the militants opening fire shamefully abandoned the place committed to his charge and which he was under a duty to defend
Both clauses a and h are therefore clearly attracted
The impugned trial by summary court martial and the decision thereby must be held to be without jurisdiction and have to be quashed
We do not find any merit in the other points men tioned in the writ petition or in the special leave peti tion
They are finally rejected
374 9
During the course of the hearing we drew the pointed attention of the learned counsel for the appellant that if he succeeded on the basis that the Summary Court Martial was without jurisdiction he the appellant may have to be retired and awarded a more severe punishment The learned counsel however decided to press the point even at the risk of a second trial of the
appellant
The learned coun sel for the respondents stated that a fresh proceeding may now be barred by the law of Limitation and in view of the fact that the appellant is guilty of a very serious charge this Court should decline to exercise its power under Arti cle 136
In reply the learned counsel for the appellant pointed out that the period of limitation for commencing a fresh proceeding against the appellant shall not expire before 050292 and the apprehension expressed on behalf of the respondents that the appellant even if guilty may escape a trial is misconceived
We hold that the appellant is correct
Accordingly we set aside the impugned judgment of the High Court as also the conviction and sentence passed against the appellant by the Summary Court Martial but allow the respondents authorities to proceed to hold a fresh trial of the appellant in accordance with law
The appeal is accordingly allowed
TNA Appeal allowed


Summary:
The respondents assessees were engaged in the manufacture of mild steel rods bars or rounds
They claimed that as the articles manufactured by them fell under item 1 of the list set out in the Fifth Schedule they were entitled to a higher rate of development rebate specified in section 331 b B i a and to relief under section 80 1 of the Income Tax Act 1961
The Income Tax Officer rejected the claim of the assessees whereas the Appellate As sistant Commissioner the Tribunal and High Court accepted their claim
Hence the Revenue filed appeals before this Court
The contentions of the appellant Revenue were that iron and steel ceased to be a metal when it came out of the furnace in the primary steel mills in the form of ingots
In the next stage the ingots became semi finished products in the shape of billets blooms and slabs
It was said to be the stage where the raw materi als were converted into
In different form or shape that the expression iron and steel metal meant the iron and steel as it emerged in the form of billets blooms and slabs from the steel mill and that all subse quent products whether in the form of rails rods including wire rods bars angles channels tees sees pipes tubes sheets strips plates and coils would constitute articles made of iron and steel and that rolling mills making bars and rods were not covered by item 1 of the Fifth Schedule
188 On the other hand the respondents asses sees contended that in the steel industry the manufacture of ingots billets blooms etc
represented only an intermediate stage at which the iron and steel metal became semi finished steel
When the semi finished steel was converted into plates bars or rods they became finished steel
The bars rods and rounds which were continued to be iron and steel in a finished form were used to manu facture the products of iron and steel by various processes such as rolling cutting shearing forging hammering etc
and that the products of iron and steel were different from that of iron and steel metal
Dismissing the appeals filed by the Revenue this court HELD 1
In interpreting the provisions in S331bBia S80 I of the Income Tax Act 1961 the Court would do well to keep in mind the background in which concessions to certain basic industries were introduced in the Income Tax Act
The historical background reflects the intention of the legislature to grant progressively certain exemptions re liefs and concessions for certain types of industries which were considered important for national development
The industry in iron and steel and other metals figured in all the lists
199 C 200 B 2
The incentive concession or relief granted under the provisions has to be con strued in a broad and comprehensive manner so as to cover all manufacturing activities legitimately pertaining to the specified core industry with no limitation save what may be called for by the wording of a particular entry
So far as items 1 and 2 are concerned the wording points to a distinction between the metal which is used as the base and other articles manufactured therefrom
Pig iron and iron scrap are fed into furnaces to produce ingots billets and blooms
But both are iron and steel in different forms the latter being referred to as semi finished steel
Like wise the bars rods rounds wire rods and the like constitute the second stage in which one gets only finished forms of iron and steel
Having regard to the nature and weight of the metal it has to be finished to assume these forms before manufacturers of iron and steel articles can take over and proceed to manufacture articles from them by drawing wires or converting them into rails or shaping them into tees zees pipes tubes and the like
200 C E 3
Whether the article produced is the raw material 01 an article made of iron and steel has to be decided on the basis of the 189 nature of the article and not the kind of mill which turns it out
It is significant that these items do not draw distinction between basic steel mills integrated steel mills and the various other types of mills that are used in the industry
200 G 4
The departmental instructions that machinery and plant in rolling mills will not be eligible for the higher development rebate would not seem to be justified if it intends to draw a distinction between the same machinery and plant when used in rolling mills and when used in other mills in the industry
If machinery and plant installed in steel mills where the process includes not merely the production of ingots billets and the like but also the production of bars and rods are eligible for the higher development rebate it is difficult to see why the same plant and machinery when installed in rolling mills which proceed from the stage of ingots or billets to manufacture bars and rods should not be eligible for the higher rate of devel opment rebate
200 G 201 B 5
In considering the issue the court should not be carried away be classifications of stages of manufacture that may be relevant for other purposes
What the court should examine is not the nature of the mill which yields the article but the nature of the article or thing that is manufactured and ask the question whether such articles or things can be considered as raw material for manufac ture of other articles made of the metal or is it itself an article made of the metal
201 B C 6
The goods in the present case fail in the former category
The mild steel rods bars or rounds which are manufactured by the asses sees are only finished forms of the metal and not articles made of iron and steel
They only constitute raw material for putting up arti cles of iron and steel such as grills or windows by applying to them processes such as cutting or turning
The rod or the wire rods are likewise not products of iron and steel but only certain finished or refined forms of the metal itself
201 C D 7
Forging and castings are not covered by item 1 being articles made of iron and steel but that since the legislature definite ly intended to give relief even in respect of such articles item 11 and also item 21 were introduced
Even if MS steel rods bars and rounds cannot be taken as iron and steel metal they would fail under the category of forgings and castings referred to in item 11
201 G H 190 8
The conclusion drawn by the High Court that the assessee was entitled to the higher development rebate though it produced arti cles only from iron scrap does not call for any interference
202 C D CI T vs Mittal Steel Re tolling and Allied Industries P Ltd  CI
West India Steel Co Ltd Kerala Addl
Commissioner of Income Tax vs Trichy Steel Rolling Mills Ltd  CITv
Krishna Copper Steel Roll ing Mills  Har yana CITv
Ludhiana Steel Rolling Mills  Haryana and Singh Engineering Works Pvt Ltd vs CIT  approved
Indian Steel and Wire Products Lid vs Commissioner of Income tax and Commissioner of Income Tax vs Kay Charan Pvt Ltd  over ruled
State of Madhya Bharat vs Hira Lal 1966 17 STC 313 SC Devi Dass Gopal Krishnan vs State of Punjab 1967 20 STC 430 SC Hindustan A1uminium Corporation Ltd vs State of UP 1981 48 STC 411 SC State of Tamil Nadu vs Pyarelal Malhotra 1976 37 STC 319 SC CITv
Rashtriya Metal Industries Co Ltd  Indian A1uminium Co Ltd vs
CIT Cal
and Cal Jeewanlal vs CIT  CIT vs Fitwell Caps P Ltd  Hindustan Wire Products vs CIT 1  Indian Steel and Wire Products Lid vs CIT  CITv
Tensile Steel Lid and CI
Ludhiana Steel Rolling Mills  H referred to
Speci fication and Glossary By Expert Products Sectional Committee of Bureau of India Standards New Encyclopedia Brittanica Macropaedia 15th Edn Vol21 Websters Third New International Dictionary Encyclopaedia of Chemical Technology By Kirk Othmer 3rd
Vol21 Book on Small Scale Steel Making By RDWalker The Budget Speech of the Finance Minister 1968 48 ITR Statutes 34 1965 55 ITR Statutes 57 and 122 referred to