JUDGMENT

OJHA, J.:—This appeal has been preferred on the basis of a certificate granted by the High Court of Gujarat under S. 261 of the Income-tax Act, 1961 (hereinafter referred to as the Act). The judgment appealed against is reported in Cellulose Products of India Ltd. v. Commr. of Income-tax, Gujarat, (1977) 110 ITR 151. The respondent is a public limited company incorporated on April 14, 1989 mainly for the purpose of carrying on business of manufacturing chemical products. The Memorandum of Association of the respondent company, as is apparent from the order of the Appellate Assistant Commissioner of Income-tax, inter alia, contains the following clause:-

"to carry on the business of manufacture of and dealer and importers and exporters in chemical products of any nature and kind whatsoever and particularly of Carboxy Methyl Cellulose (CMC), Cellulose Pulps and other chemical products."

The respondent was granted an industrial licence by the Central Government for the manufacture of Sodium Carboxy Methyl Cellulose for short (CMC). In pursuance of the said licence the respondent installed a Cellulose plant, in which was manufactured Cellulose pulp which in its turn was meant to