H. R. KHANNA, C. J.

( 1 ) THIS judgment would dispose of two Income-tax References Nos. I and 17 of 1967 in each of which the following identical question has been referred to this Court by the Income-tax Appellate Tribunal under section 66 (1) of the Indian Income-tax Act, 1922, (hereinafter referred to as the Act) at the instance of the Revenue :-

"whether, on the facts and in the circumstances of the case, the assessee company is entitled to exemption from tax on the profits or gains derived from the plant and machinery installed by it at a cost of Rs. l,10,00,000. 00 under section 15c of the Income-tax Act, 1922?"

( 2 ) REFERENCE No. 1 relates to assessment year 1959-60 whereas Reference No. 17 pertains to assessment years 1960-61, 1961-62 and 1957-58 The assessee in these References is Ganga Sugar Corporation Ltd. and the learned counsel for the parties are agreed that the decision in Reference No. 1 of 1967 would also cover the question which is the subject matter of the other Reference. In the circumstances, we may deal with the facts as given in Reference No. 1.

( 3 ) THE assessee company carles on the business of manufacturing sugar. At the time of its incorporation in 1934

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