Judgment :- R. JAYASIMHA BABU, J. The question required to be considered by us in this reference is as to whether the processing of shrimps amounts to production or manufacture entitling the assessee to deduction under s. 80HH of the IT Act? The question arises out of the assessment of the income by the respondent, George Maijo (Cuddalore), Madras for the asst. yrs. 1979-80 and 1980-81. The reference is made at the instance of the Revenue. 2. The assessee is engaged in the business of processing and exporting shrimps. Its claim for deduction under s. 80HH of the Act was rejected by the ITO on the ground that such processing does not amount to production or manufacture. The CIT(A) however was of the view that it does amount to manufacture, and allowed the assessee's appeal. The Revenue carried the matter further in appeal to the Tribunal which agreed with the view of the CIT(A). The Tribunal relied upon the decision of the Karnataka High Court in the case of Sterling Foods vs. CIT, wherein the question could not arise for consideration and the decision of the Delhi High Court in the case of Delhi Cold Storage (P) Ltd. vs. CIT to hold that processing of shrimps amounts of manufacture. The Delhi High Court also in that case was not concerned with the question which arises for consideration here. The Court held in that case that keeping of goods in a cold storage plant does not bring about any change and that to characterise an operation as 'processing' that commodity must as a result of the operation, experience some change. 3. Learned counsel for the Revenue submitted that this view of the Tribunal is wholly erroneous in law and is clearly contrary to the law laid down by the Supreme Court in the case of Sterling Foods vs. The State of Karnataka & Anr. In heat decision rendered by a Bench of three learned Judges of the apex Court, it was held that the test which has to be applied for the purpose of determining whether a commodity subjected to processing retains its original character and identity, even after processing is as to whether the processed commodity is regarded in the trade by those who deal in it as distinct in identity from the original commodity or it is regarded, commercially and in the trade, the same as the original commodity. In so holding the apex Court followed the decision rendered by the apex Court in the case of Dy. CST vs. Pio Food Packers. 4. The commodity which was considered by the apex Court in the case of Sterling Foods (supra), was the same as the one processed by the assessee herein. The Court held that on the application of the test formulated in the case of Pio Food Packers, followed in the case of Sterling Foods, it was clear that the processed or frozen shrimps prawns, and lobsters are commercially regarded the same commodity as raw shrimps, prawns and lobsters. The Court observed, "When raw shrimps prawns, and lobsters are subjected to the process of cutting of heads and tails, peelig, deveining, cleaning and freezing, they do not cease to be shrimps, prawns and lobsters and become another distinct commodity. They are in common parlance known as shrimps, prawns and lobsters. There is no essential difference between the raw shrimps, prawns, and lobsters. The dealer and consumer regard both as shrimps, prawns and lobsters. The only difference is that the processed shrimps, prawns and lobsters are ready for the table, while raw shrimps, prawns and lobsters are not, but still both are in commercial parlance shrimps, prawns and lobsters. It is undoubtedly true that processed shrimps, prawns and lobsters are the result of subjecting raw shrimps, prawns and lobsters to a certain degree of processing but even so they continue to possess their original character and identity as shrimps, prawns and lobsters, notwithstanding the removal of heads and tails, peeling, deveining and cleaning which are necessary for making them fit for the table. Equally it makes no difference in character when shrimps, prawns and lobsters are frozen for the purpose of preservation and transfer to other places including far off countries in the world. There can therefore be no doubt that processed or frozen shrimps, prawns and lobsters are not a new/and distinct commodity but they retain the same character and identity as the original shrimps, prawns and lobsters." 5. The apex Court in the case of Sterling Foods, referred with approval to the decision of the Supreme Court of United States in the case of East Texes Motor Lines vs. Frozen Food Express 351 US 49 : 100 L.Ed. The apex Court in the case of Sterling Foods, referred with approval to the decision of the Supreme Court of United States in the case of East Texes Motor Lines vs. Frozen Food Express 351 US 49 : 100 L.Ed. 917 wherein the Supreme Court of US held that dressed and frozen chicken was not a commercially distinct commodity but was commercially and in common parlance the same article as chicken. 6. The enunciation made by the Supreme Court regarding the result of the processing of shrimps in such a lucid manner, one would have expected, could make any litigant realise the futility of any further argument on the question in issue here. However, counsel for the assessee made a valiant attempt to sustain the order of the Tribunal and referred to a number of decisions rendered by this Court and other High Courts on the question as to whether the processing of sea foods results in the manufacture of a new article, and relying on those decisions, sought to contend that processing of shrimps by the assessee would result in manufacture and production of a new article which was commercially a distinct and different article. 7. Learned counsel relied on the decision of this Court in the case of CIT vs. Orient Marine Products (P) Ltd., wherein it was held following the decision of the Calcutta High Court and the Kerala High Court that the processing of shrimps, frog legs and prawns would amount to manufacturing activity as contemplated under s. 80J(ii) of the Act. That decision was rendered by this Court without referring to the judgment of the Supreme Court in the case of Sterling Foods (supra) and applying the law laid down, therein and must be regarded as per incurium. Counsel also relied on the decisions of the Kerala High Court CIT vs. Poyilakkada Fisheries Ltd. and CIT vs. Marwell Sea Foods, wherein it was inter alia held that processing of prawns will amount to production of articles and the processor assessee is entitled to allowance under s. 80J and s. 32A of the IT Act, and the decision of the Calcutta High Court in CIT vs. Union Carbide India Ltd., wherein it was held by the Calcutta High Court that a new commercial product comes into being when raw shrimps is cleaned, peeled, packed and frozen. These decisions which run counter to the decision of the apex Court in the case of Sterling Foods (supra) must be held to have been incorrectly decided, and with great respect we must dissent from those rulings. 8. Learned counsel for the assessee relied on the decision of the apex Court in the case of CIT vs. N. C. Budharaja & Co. & Anr. in support of his submission that by the processing of shrimps they are 'produced' even if they are not manufactured. Counsel relied in particular on the following passage at p. 423 of the judgment, "The word 'production' or 'produce' when used in juxtaposition with the word 'manufacture' takes in bringing inter-existence new goods by a process which may or may not amount to manufacture. It also takes in all the bye-products, intermediate products and residual products which emerge in the course of manufacture of goods." The passage so relied on by the counsel is only a part of the judgment of the apex Court in the case of Dy. CST vs. Pio Foods Packers (supra) which case was considered by the apex Court in the case of Sterling Foods. It was only after considering the decision of the Court in the case of Pio Food Packers and after applying the tests laid down therein, the apex Court came to the definite conclusion that the processing of shrimps for the purpose of export by removing the heads and tails, peeling, deveining, cleaning and freezing, does not bring into existence a commercially new and different commodity and that the commodity remains the same before and after processing of the shrimps. As 'new' goods are not brought into existence by the processing of shrimps at any stage of the processing, frozen shrimps are neither produced nor manufactured by reason of such processing. 9. The only answer possible and the one which we record, to the question referred to us, is that the Tribunal was in error in holding that the processing of shrimps for export amounts to production or manufacture entitling the assessee to deduction under s. 80HH of the IT Act. The question referred to us is answered in the negative in favour of the Revenue and against the assessee. Revenue shall be entitled to costs in the sum of Rs. 1, 000 (Rs. One thousand only) payable in one set.