- (1.) Aggrieved by the judgment/order of the High Court, the assessee-appellant has come up in appeal. By the impugned judgment, the High Court in a reference made under Section 256(1) of the Income-tax Act, 1961 (for short, 'the Act') by the Income-tax Appellate Tribunal, Cochin (for short 'the Tribunal') has answered the following question of law in the negative. "Whether, on the facts and the circumstances of the case, the Tribunal is right in law and fact in holding that the assessee's activity of curing coffee amounts to manufacturing and the assessee is entitled to relief under Section 32-A of the Income-tax Act - i.e. against the assessee and in favour of the Revenue.
(2.) The High Court opined that the assessee is not entitled to the investment allowance under Section 32-A of the Act in respect of the machinery used for curing coffee and its sale.
(3.) The relevant facts giving rise to the above question of law are :- The Assessment Years in question are 1980-1981 and 1983-1984. The assessee is a public limited company. It is engaged in the export of coir products, distribution of insecticides and pesticides, running and managing of estates on service contracts. In addition, the assessee has coffee curing plants. For the machinery installed for curing of the coffee, the assessee claimed investment allowance under Section 32-A for both the Assessment Years. The Income-tax Officer held that the assessee was not entitled to the investment allowance. Assessee preferred appeal before the Commissioner of Income-tax (Appeals) [for short'C.I.T. (Appeals)] who allowed the appeals and held that the assessee was entitled to the investment allowance as provided under Section 32-A of the Act.;