JUDGMENT

Special leave granted.

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 industrial company as defined in S. 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 the meaning of industrial company. The question that was referred by the Incometax 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 S. 2(7)(c) of the Finance Act, 1973 and the First Schedule thereto?"

3. The Income-tax Officer had not accepted the claim of the appellant but the Appellate Assistant Commissioner conceded the claim and directed remission of the proceedings to the Income-tax Officer for recomputation of the tax by treating the appellant as an industrial company. The Tribunal accepted the appeal of the Revenue and held that the appellant was not an industrial company. The High Court has approved the conclusions reached by the Tribunal.

4. Industrial companyhas been defined in S. 2(7)(c) of the Finance Act, 1973 thus:

"Industrial company means a company which is mainly 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." (Underlining is ours)

5. The appellant had taken the stand that the activity carried on by it came within the words processing of goods. The short question for examination, therefore, is whether the cold storage of the appellant can be held to have been engaged in the processing of goods.

6. This question directly arose for consideration of a Division Bench of the Calcutta High Court in Commr. of Income-tax v. Radha Nagar Cold Storage (P) Ltd., 126 ITR 66. Sabyasachi Mukharji, J. (as he then was) spoke for the Court in this case. Certain English cases were taken into consideration to find out the difference between manufacturing and pyocessing and to find the true meaning of the word "processing". The word "processing" has not been defined in the Income-tax Act. The word process has various meanings, some wider than others. Lord Guthrie in Kilmarnock Equitable Co-operative Society Ltd. v. I.R.C. (1966) 42 Tax Cas 675 at p. 681 observed that the word does not have the widest significance of anything done to the goods or materials.The Division Bench of the Calcutta High Court looked for the meaning in the Oxford Dictionary, Websters New International Dictionary, Words and Phrases Legally Defined Vol. 4 and in Encyclopaedia Britannica Vol.9. The High Court was impressed by the statement in Encyclopaedia Britannica, Vol. 9 where it was said (at p. 1193 of Tax LR):

"The only method by which fresh foods may be preserved for a considerable period in the raw state is by subjecting them to as low a temperature as possible without causing damage by freezing. Storage at temperature above freezing, in the neighbourhood of 35 F/2C is known as cold storage. Storage at such temperature makes possible the holding in good condition of many fresh foods for considerable periods and their shipment to distant markets to consumers."

7. The High Court proceeded to State (at p. 1183 of 1980 Tax LR 1181):

"The act of cold storage appears to us to be an act whereby foods or products stored in the cold storage are prevented from their natural decay. The potatoes which are kept in the cold storage are preserved in the original state and their normal decay is prevented. That, in our opinion, would be processing the goods, that is to say, preservation applying a method to the goods where by the goods are prevented from taking its normal course. Therefore, looking from a broad point of vie