1. The Income Tax Appellate Tribunal has referred the following two questions of law arising out of its order dated December 26, 1991, in respect of the assessment year 1986-87 under Section 256(1) of the Income Tax Act, 1961.

"Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in coming to the conclusion that the original assessment which granted the relief under Sections 32A and 80-I to the assessee was not erroneous and the inference of the Commissioner of Income Tax under Section 263 was. not proper ?

Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in holding that extracting granite from quarry and cutting it to various sizes and polishing should be considered as manufacture or production of any article or thing and the assessee's business activity must be considered as industrial undertaking for the purpose of granting reliefs under Sections 32A and 80-I of the Income Tax Act, 1961 ?"

2. The assessee is a public limited company. The business of the assessee is extracting granite from quarry, converting the same to slabs, polishing and cutting before effecting the sale of the