Case: Delhi Cold Storage Private Limited Vs. Commissioner of Income Tax, Delhi-I, New Delhi I.N. Delhi

2. The judgment of the High Court of Delhi is challenged by the assessee in this appeal. Assessee is a private limited company running a cold storage. The year of assessment is 1973-74. An ‘industrialas defined in Section 2(7)(c) of Finance Act, 1973 for the purposes of the First Schedule of that Act was entitled to certain concessions in the matter of taxation. The appellant laid claim to such benefits by contending that it came within theof ‘industrial company. The question that was referred by the Income-tax Appellate Tribunal to the High Court was:Whether on the facts and in the circumstances of the case the assessee company running a cold storage could be held to be an industrial company for purposes of Section 2(7)(c) of the Finance Act, 1973 and the First ScheduleThe Income-tax Officer had not accepted the claim of thebut the Appellate Assistant Commissioner conceded the claim and directed remission of the proceedings to the Income-tax Officer forof the tax by treating the appellant as an ‘industrialThe Tribunal accepted the appeal of the Revenue and held that the appellant an ‘industrialThe High Court has approved the conclusions reached by the Tribunal.4. Industrialhas been defined in Section 2(7)(c) of the Finance Act, 1973company means a company which is mainlyin 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(Underlining is ours).

Court's reasoning:
9. The meaning given to the wordand the test laid down to find out whether the operation amounts to processing by the three-Judge Bench of this Court runs counter to the conclusions reached by the Allahabad and Calcutta High Courts. As we have already pointed out, the two direct decisions on the point are the cases from Allahabad and Calcutta. The other cases that have been cited in the Calcutta judgment or at the Bar are cases not relating to the meaning or ambit of the relevant expression in theof Section 2(7)(c) of the Finance Act, 1973.In common parlanceis understood as an action which brings forth some change or alteration of the goods or material which isto the act of processing. The dictionary meaning of the term is not very different from this meaning in one sense while various other meanings of wider amplitude are also available. The view taken by Allahabad and Calcutta High Courts did not find favour with the three-Judge Bench of this Court and in clear terms the judgment indicates that processing involves bringing into existence a different substance from what the material was at theof the process.12. In a cold storage, vegetables, fruits and several other articles which require preservation by refrigeration are stored. While as a result of long storage, scientific examination might indicate loss of moisture content that is not sufficient for holding that the stored articles have undergone a process within the meaningof Section 2(7)(c) of the Finance Act, 1973.The Court referred with approval to a decision of the Allahabad High Court in Addl. Commissioner of Income tax, Kanpur v. Farrukhabad Cold Storage (P) Ltd., 107 ITR 816 . The Calcutta Highview directly supports the