- (1.) THE Tribunal has referred the following question of law arising out of its order dt. 30th June, 1983 in respect of the asst. year 1979 80 under S. 256(1) of the IT Act, 1961 : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the assessee firm is an industrial undertaking and consequently in directing to allow deduction under S. 35B(1)(a) of the IT Act, 1961?"
(2.) THE brief facts of the case are that the assessee firm is engaged in the business of processing and sale of precious stones, and Rs. 12,636 was claimed under S. 35 B(1)(a). The claim of the assessee is that he is a small scale exporter. The claim was not allowed by the ITO and it was observed that processing of stones cannot be considered as an industry at all, therefore the grant of weighted deduction is not allowable. The CIT(A) in an appeal preferred by the assessee came to the conclusion that the definition of small scale exporter has been given in the section, which means that a person who exports goods manufactured or produced in any small scale industrial undertaking or undertakings owned by him and came to the conclusion that assessee is not an industrial undertaking. The order of CIT(A) was challenged by the Revenue before the Tribunal and the Tribunal observed that the same issue came up for consideration before the Tribunal in the case of Dhandia Gems Corporation and on the basis of the said decision the appeal of Revenue was dismissed. The submission of Mr. Bapna counsel for the Revenue is that the decision of Dhandia Gems Corporation which has been relied upon by the Tribunal is different and, therefore, the view which has been taken by the Tribunal should be considered in accordance with law. Shri T.C. Jain for the assessee submitted that finding of facts has not been recorded and the ingredients which were necessary for the purpose of establishing the fact that assessee is a small scale industrial undertaking has also not come on record.
(3.) WE have considered over the matter. It was for the assessee to prove when the deduction is claimed that the goods produced or manufactured are in a small scale industrial undertaking. The facts which have been found by the Tribunal are similar to that of Dhandia Gems Corporation and therefore it is to be presumed that the case of assessee is similar to the case of Dhandia Gems Corporation as he himself placed reliance on the said decision before the Tribunal. The decision of the Tribunal in Dhandia Gems Corporation has already been considered by this Court in the case of CIT vs. Dhandia Gems Corpn. (1994) 121 CTR (Raj) 96 : (1994) 298 ITR 923 (Raj). In the said decision it was found that manufacture was done through labourers paid on the basis of work done. There was no document on the basis of which it could be said that the goods which were manufactured or produced were goods which were from a small scale industrial undertaking owned by the assessee. The assessee was not entitled to weighted deduction under S. 35B(1)(a) of the IT Act, 1961. Accordingly the reference is answered in favour of the Revenue and against the assessee. No order as to cost.;