Judgment 1. The Income-tax Appellate Tribunal has referred the following two questions of law arising out of its order dated September 17, 1982, in respect of assessment year 1976-77: 1. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is justified in law in holding that the firms engaged in the construction of darns, constituted an industrial undertaking within the meaning of Section 5(1)(xxxii)? 2. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is justified in holding that the interest of the assessee in the assets of the firms qualified for exemption under Section 5(1)(xxxii) ?“ 2. The brief facts of the case are that the assessee is a partner in the firms, M/s. Mittal and Co., Project Works, Dholpur, M/s. Mittal and Co., Dholpur and M/s. Mittal and Co., Bombay, and had credit balances. The firms were engaged in the construction of dams. It was claimed that the said three firms are industrial undertakings within the meaning of Section 5(1 )(xxxii) of the Wealth-tax Act, 1957, and the value of the assets forming part of such industrial undertakings belonging to the firms in which the assessee was a partner, was exempt under Section 5(1)(xxxii). The claim of the assessee was rejected by the Wealth-tax Officer. The matter was challenged before the Appellate Assistant Commissioner and reliance was placed on the decision of the Delhi High Court in the case of National Projects Construction Corporation Ltd. vs. CWT [1969] 74 ITR 465, wherein it was held that the company engaged in the construction of dams and barrages was an industrial company. 3. Thesubmission of learned Counsel for the Revenue is that in the following cases it was held that a construction company, is not an industrial company in accordance with the provisions of the Income-tax Act-CIT vs. Minocha Brothers P. Ltd. [1986] 160 ITR 134(Delhi), CIT vs. N.U.C. Pvt. Ltd. [1980] 126 ITR 377(Bom) and CIT vs. Oricon Pvt. Ltd. [1989] 176 ITR 407 (Bom). 4. Learned Counsel for the assessee has placed reliance on the Orissa High Court decision in CIT vs. N.C. Budharaja and Co. [1980] 121 ITR 212 wherein also the construction of dams was held to be an industrial undertaking. 4. Learned Counsel for the assessee has placed reliance on the Orissa High Court decision in CIT vs. N.C. Budharaja and Co. [1980] 121 ITR 212 wherein also the construction of dams was held to be an industrial undertaking. It was also brought to the notice of the appellate authority that in the case of another partner, Smt. Kanak Jain, who was a partner in the firm, M/s. Mittal and Co., Bombay, the benefit under Section 5(1) (xxxii) has already been allowed by the assessing authority. The order of the Appellate Assistant Commissioner was confirmed by the Income-tax Appellate Tribunal. 5. In CIT vs. Pressure Piling Co. (India) P. Ltd. [1980] 126 ITR 333, the Bombay High Court has held while interpreting the provisions of Section 84(1) of the Income-tax Act that by subjecting the concrete mixture which consisted of several articles to certain processes along with iron bars, something new was brought into being. By the piling process something new which ultimately formed part of the construction came into being and since the end-product of the piling process was something which had an independent existence and an independent entity and was described as a pile, it was an article for the purpose of Section 84(2)(iii) since it was brought into being by a special process of production and, therefore, the assessee was engaged in the “manufacture or production of articles” within the meaning of Section 84(2)(iii) and was entitled to relief under the section. 6. In Shankar Construction Co. vs. CIT [1991] 189 ITR 463, the matter before the Karnataka High Court was with regard to investment allowance under Section 32A and it was held that construction of a “dam” was an industrial undertaking entitled to investment allowance. It was held that where there is systematic activity, organised by co-operation between employer and employee, for the production and/or distribution of goods and services calculated to satisfy human wants and wishes, prima facie there is an industry within the purview of Section 32A. 7. We have considered the arguments of both the parties. It was held that where there is systematic activity, organised by co-operation between employer and employee, for the production and/or distribution of goods and services calculated to satisfy human wants and wishes, prima facie there is an industry within the purview of Section 32A. 7. We have considered the arguments of both the parties. In accordance with the provisions of Section 5(1)(xxxii), wealth-tax is not payable on the value as determined in the prescribed manner of the interest of the assessee in the assets (not being any land or building or any asset referred to in any other clause of this Sub-section) forming part of an industrial undertaking belonging to a firm or an association of persons of which the assessee is a partner or, as the case may be, a member. The industrial undertaking has been defined under Section 5(1)(xxxi) of the Act in the Explanation to mean an undertaking engaged in 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 mining. 8. In view of the Explanation to Section 5(1)(xxxi) read with Section 5(1)(xxxii) it has to be seen as to whether the various conditions of the Explanation are fulfilled. There must be an industrial undertaking which must be engaged in the business of generation or distribution of electricity or any other form of power or in the construction of ships or in mining besides the “manufacturing or processing of goods”. The manufacturing or processing of goods refers to movable property and there should be a manufacturing or processing of goods as end-products by the industrial undertaking. If an industrial undertaking is engaged in the manufacture or processing of any other item which does not fall in the category of “goods”, then the exemption cannot be claimed, What constitutes “goods” has not been defined in the Wealth-tax Act. But if the definition in the Sale of Goods Act is taken into consideration, which refers only to movable property, “dams” could not be considered goods. 9. In CIT vs. N.C. Budharaja and Co. But if the definition in the Sale of Goods Act is taken into consideration, which refers only to movable property, “dams” could not be considered goods. 9. In CIT vs. N.C. Budharaja and Co. [1980] 121 ITR 212(Orissa) the matter was with regard to the claim of the assessee under Section 8OHH of the Income-tax Act and it was held that the word “article” as used in Section 8OHH(2)(i) need not be confined to movable property and a “dam” is an article and since the assessee undertaking is manufacturing certain material which it ultimately used in the construction of the “dam” it worked for the ultimate production of a “dam”. 10. Thedecision of the Orissa High Court in N.C. Budharaja and Co. ‘s case [1980] 121 ITR 212 has been reversed by the apex Court as per judgment dated September 7, 1993, in C.A. Nos. 4238-4240 of 1983 (See CIT vs. N.C. Budharaja and Co. [1993] 204 ITR 412), The word “manufacture” and “production” were interpreted as under (at page 423) “The words ‘manufacture’ and ‘production’ have received extensive judicial attention both under this Act as well as the Central Excises Act and the various sales tax laws. The word ‘production’ has a wider connotation than the word ‘manufacture’. While every manufacture can be characterised as production, every production need not amount to manufacture. The meaning of the expression ‘manufacture’ was considered by this Court in Deputy CST vs. Pio Food Packers [1980] 46 STC 63 (SC) among other decisions. In the said decision, the test evolved for determining whether manufacture can be said to have taken place is, whether the commodity which is subjected to the process of manufacture can no longer be regarded as the original commodity but is recognised in the trade as a new and distinct commodity. . . . Theword ‘production’ or ‘produce’ when used in juxtaposition with the word ‘manufacture’ takes in bringing into existence new goods by a process which may or may not amount to manufacture. It also takes in all the by-products, intermediate products and residual products which emerge in the course of manufacture of goods.” 11. The word “article” was also interpreted as under: “The next word to be considered is ‘articles’ occurring in the said clause. What does it mean ? The word is not defined in the Act or the Rules. It also takes in all the by-products, intermediate products and residual products which emerge in the course of manufacture of goods.” 11. The word “article” was also interpreted as under: “The next word to be considered is ‘articles’ occurring in the said clause. What does it mean ? The word is not defined in the Act or the Rules. It must, therefore, be understood in its normal connotation--the sense in which it is understood in the commercial world. It is equally well to keep in mind the context since a word takes its colour from the context. The word ‘articles’ is preceded by the words ‘it has begun or begins to manufacture or produce’. Can we say that the word ‘articles’ in the said clause comprehends and takes within its ambit a dam, a bridge, a building, a road, a canal and so on ? We find it difficult to say so. Would any person who has constructed a dam say that he has manufactured an article or that he has produced an article? Obviously not. If a dam is an article, so would be a bridge, a road, an underground canal and a multi-storeyed building. To say that all of them fall within the meaning of the word ‘articles’ is to overstrain the language beyond its normal and ordinary meaning. It is equally difficult to say that the process of constructing a dam is a process of manufacture or a process of production. ... A dam is constructed ; it is not manufactured or produced. The expressions ‘manufacture’ and ‘produce’ are normally associated with movables-articles and goods, big and small--but they are never employed to denote a construction activity of the nature involved in the construction of a dam or for that matter a bridge, a road or a building.” 12. Itwas also observed that liberal construction does not mean that the Court can rewrite the section. It was observed (at page 426) : “The said principle, however, cannot be carried to the extent of doing violence to the plain and simple language used in the enactment. It would not be reasonable or permissible for the Court to rewrite the section or substitute words of its own for the actual words employed by the Legislature in the name of giving effect to the supposed underlying object”. 13. It would not be reasonable or permissible for the Court to rewrite the section or substitute words of its own for the actual words employed by the Legislature in the name of giving effect to the supposed underlying object”. 13. The difference between the provisions of Section 32A(2)(b)(iii) and Section 8OHH(2)(i) or Section 84(2)(iii) were also taken into consideration and it was observed that the word “manufacture or produce articles” in the last two sections are different from the provisions of Section 32A, where the word “construction”, manufacture or production of any article or thing has been mentioned. The word “construction” has been used under Section 32A only and it was also interpreted as under (at page 433): “Though at first sight, the use of the words ‘construction’ and ‘thing’ appear to lend some substance to the contention of learned Counsel for the assessee, a deeper scrutiny--and in particular, the legislative history of the relevant provisions--militates against the acceptance of this submission The association of words in former Sub-clause (ii) and the present Sub-clause (iii) is also not without significance. The words are; ‘construction, manufacture or production of any one or more of the articles and things. . .‘ and ‘construction, manufacture or production of any articles and things. . . .‘ respectively. It is equally evident that in these Sub-clauses as well as in the Ninth Schedule and in the Eleventh Schedule, the words ‘articles’ and ‘things’ are used interchangeably. In the scheme and context of the provision, it would not be right to isolate the word ‘thing’, ascertain its meaning with reference to law lexicons and attach to it a meaning which it was never intended to bear. A statute cannot always be construed with the dictionary in one hand and the statute in the other. Regard must also be had to the scheme, context and--as in this case--to the legislative history of the provision. We are, therefore, of the opinion that Sub-clause (iii) of Clause (b) of Sub-section (2) of Section 32A does not comprehend within its ambit construction of a dam, a bridge, a building, a road, a canal and other similar constructions.” 14. In view of the above decision of the apex Court the authorities relied on by learned Counsel for the assessee cannot be considered now as good law. 15. In view of the above decision of the apex Court the authorities relied on by learned Counsel for the assessee cannot be considered now as good law. 15. In the matter before the Delhi High Court in the case of National Projects Construction Corporation Ltd. vs. CWT [1969] 74 ITR 465, the claim of the assessee was under the provisions of Section 45(d) of the Wealth-tax Act, 1957, wherein the industrial undertaking was defined to mean an undertaking engaged in the manufacture, production, or processing of goods or articles or in mining or in the generation or distribution of electricity or any other form of power. Thus, Section 5(1 )(xxxii) refers to such industrial undertaking which is engaged in the manufacture or processing of goods while under Section 45(d) of the Act the undertaking could be engaged in the manufacture, production or processing of goods or articles. The word “article” is absent in the Explanation to Section 5(1)(xxxi) and is restricted only in respect of the manufacture or processing of goods. “Dams” cannot be considered to be “goods” not being movable property and, therefore, the judgments which have been relied on by learned Counsel for the assessee are not applicable. The Explanation to Section 5(1)(xxxi) cannot be extended beyond the specific language used therein and would not cover the manufacture or processing of “articles”. Since dams do not fall within the category of “goods”, we are of the opinion that the Income-tax Appellate Tribunal was not justified in coming to the conclusion that the interest of the assessee in the assets of the firm which is engaged in the construction of dams is qualified for exemption under Section 5(1)(xxxii). 16. The reference is accordingly answered in favour of the Revenue and against the assessee