ARIJIT PASAYAT, J.

(1) AT the instance of Revenue, following question has been referred by the Income-tax Appellate Tribunal, Delhi Bench d, New Delhi (in short, the Tribunal) for opinion of this Court, under Section 256 (1) of the Income-tax Act, 1961 (in short, the).

"whether on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the assessee company had any profit attributable to the production of limestone on which relief under section 80-1 of the Income-tax Act, 1961 was admissible"

Dispute relates to the assessment year 1972-73.

(2). Factual position, in a nutshell, is as follows :-Assessee is a limited company engaged in manufacturing and sale of cement. For the assessment year in question, assessee claimed a deduction of Rs. 1,64,307. 00 under Section 80-1 of the in respect of limestone raised by it from its own quarries, taking the plea that limestone is an item included in Schedule VI of the as a priority industry. Assessing Officer rejected the claim on the ground that assessee was not engaged in the business of manufacturing or production of any of the articles mentioned in the Sixth Schedule. It was noted that up to the assessment year 1971-72, the Sixth Schedule specified both limestone as well as cement as priority industries amongst others, and therefore, benefit of Section 80-1 of the was available both for limestone and cement. The article cement was, however, omitted from the said Schedule with effect from the assessment year 1972- 73, but limestone was retained. On appeal by the assessee, the Appellate Assistant Commissioner (in short, aac) accepted assessees stand. It is to be noted that before the said authority, assessees stand was that it had maintained analytical accounts for limestone production, the language used in the relevant provisions speaks of business of production of limestone and not of business in or of limestone and that the benefit was attached to production of limestone, whether limestone so produced was sold to outside parties or utilized in the manufacture of other articles was immaterial for the purpose of Section 80-1 read with Section 80-B (7) of the. It was accordingly held by the AAC that the figure of Rs. 1,64,307. 00 as arrived at and determined was attributable to the business, and therefore, assessee was entitled to the relief claimed under Section 80-1 of the. In appeal by the Revenue, the Tribunal upheld the decision of AAC relying on a decision in another case, i. e. , Dalmia Dadri Cement Limited in I. T. A. No. 1899 of 1975-76 to which reference was also made by AAC.

(3). On being moved for reference, the question, as set out above, has been referred for opinion of this Court.

(4). We have heard learned counsel for the parties. According to learned counsel for the Revenue, AAC as well as the Tribunal lost sight of a fact that no profit was really attributable for the purpose of inclusion in the gross total income to any business carried on by a priority industry. Assessees business in quarrying the limestone was not covered by the activity envisaged under Section 80-1 of the. What is utilized in the manufacture of cement is lime and admittedly limestone is not the product, which goes into the composition of cement. Lime is different from limestone. In response, learned counsel for the assessee submitted that though lime is the article, which goes into the composition of the finished product, i. e. , cement, it is nothing but derivative of limestone and the language used in Section 80-1 of the act is not income derived/row , but income attributable to therefore, the view of aac as endorsed by the Tribunal is in order.

(5). In order to appreciate the rival submissions, it would be appropriate to quote the relevant provision, i. e. . Section 80-1 of the, which reads as follows:-

"80-1 : Deduction in respect of profit and gains from priority industries in the case of certain companies deduction in respect of profit and gains from priority industries in the case of certain companies - (1) in the case of a company to which this Section applies, where the gross total income includes any profits and gains attributable to any priority industry, there shall be allowed, in accordance with and subject to the provisions of this Section, a deduction from such profits and gains of an amount equal to five per cent thereof, in computing the total income of the company. (2) this Section applies to a domestic company, save in a case where such company is a company which is referred to in Section 108 and has a gross total income of fifty thousand rupees or less. (3) where a company to which this Section applies is entitled also to the deduction under Section 80-H, the deduction under sub-section (1) of this Section shall be allowed with reference to the amount of the profits and gains attributable to the priority industry or industries as reduced by the deduction under Section 80-H in relation to such profits and gains. "

Since Section 80-B (7) of the Act, which reads as follows, also throws some light on the issue, same is quoted. " (7) "priority industry" means the business of generation or distribution of electricity or any other form of power or of construction, manufacture or production of any one or more of the articles or things specified in the list in the Sixth Schedule or the business of any hotel where such business is carried on by an Indian company and the hotel for the time being approved in this behalf by the Central Government;"

(6). As has been rightly submitted by learned counsel for the assessee, the language used is income attributable to Meaning of the said expression was examined by the Apex Court in many cases and one of the earliest decisions is combay Electric Supply Industrial Co. Ltd v. C. I. T. (1978) 113 ITR 84 [LQ/SC/1978/133] it was held that the expression attributable to is certainly of wider import than the expression derived from. The former expression covers receipts from sources other than the actual conduct of the business of the priority industry. Profits and gains can be said to be attributable to the priority industry under Section 80-1 of the if there is a direct and proximate connection between the profits and gains and the business of the priority industry. See Vellore Electric Corporation Ltd. v. C. I. T. (1997) 227 itr 557 (SC) [LQ/SC/1997/918] ; India Leather Corporation Pvt. Ltd. v. C. I. T. (1997) 227 ITR 552 (SC) [LQ/SC/1997/777] ; and Ashok Leyland Ltd. v. C. I. T. (1997) 224 ITR 122. [LQ/SC/1996/2249] As observed in Walsh v. Pother District Council (1978) 1 All ER 510 (QB1), the connection need not be that of sole, dominant cause and effect; and a materially contributory connection is quite sufficient. Essential ingredients to bring in application of Section 8. 0-1 are as follows:-

" (1) An assessee must be a company; (2) It must have a gross total income; (3) Such gross total income includes any profits and gains attributable to any priority industry; (4) Said priority industry means the business of inter alia construction, manufacture or production of any one or more of the articles or things specified in the list in the Sixth Schedule (in terms of Section 80-B (7))".

(7). In India Leathers case (supra), the Apex Court observed as follows:-

"we have perused the said judgments of this court. It is no doubt true that the words attributable to have a wider meaning than the words derived from. But at the same time, it cannot be ignored that normally the word attributable to implies that "for a result to be attributable to anything it must be wholly, or in material part, caused by that thing". (See : strands Judicial Dictionary, 5th Edn. , Volume I, page 223). A casual connection is necessary. In order that income can be said to be attributable to manufacture or processing of goods for the purpose of the Explanation to Section 104 (4) of thethe earning of the income must be directly connected with manufacture or processing of goods. It is also necessary that a material part of the said income should have been earned by that activity. "

Though the decision was rendered in the background of Section 104 (1) of the Act, yet the principles are fully applicable and in fact there is no dispute on this score.

(8). In Vellore Electrics case (supra), the view was reiterated by the Apex Court in the following words:-

"the position that emerges from these decisions is that profits and gains can be said to be attributable to the priority industry under Section 80-1 if there is a direct and proximate connection between the profits and gains and the business of the priority industry. In this context, reference may be made to the recent decision in India Leather Corporation Pvt. Ltd. v. C. I. T. (1997) 227 ITR 552 (C. A. No. 292 of 1982 decided on 30/04/1997), and this Court, while construing the words "income attributable to any of the aforesaid activities" in Section 104 (4) of the Act, has said (page 556)"

"in order that income can be said to be attributable to manufacture or processing of goods for the purpose of Explanation to Section 104 (4) of the act the earning of the income must be directly connected with manufacture or processing of goods. "

"this would mean that it is not necessary that the income should have been earned from the actual conduct of the business of generation and distribution of electricity. What is required is that the activity from which the income is earned must have a direct and proximate connection with the priority industry of generation and distribution of electricity".

(9). Section 80-B (7) of the Act, as it stood at the relevant point of time, defines what is the priority industry. It means business of generation or distribution of electricity or any other form of power or of construction, manufacture or production of any or more of the articles or things specified in the list in the Sixth schedule or the business of any hotel, where such business is carried on by an Indian company and the hotel is for the time being approved in this behalf by the Central government.

(10). "gross total income" according to Section 80-B (5) for the purpose of chapter VI-A means the total income computed in accordance with the provisions of the without making any deduction under Chapter VI-A. computed in accordance with the provisions of the implies:-a) that deductions under appropriate computation sections have already been given; b) that any of other persons, if includible under sections 60 to 64, has been included; c) that intra-head and/or inter-head losses have been adjusted; and d) that unabsorbed business losses, etc. , unabsorbed depreciation, unabsorbed investment allowance, etc. have been set off. Whatever is arrived at in this manner can broadly be termed as gross total income as was observed by the Apex Court in Comhay Electrics case (supra). The view was reiterated in C. I. T. v. Kotagiri Industrial Co-operative Tea Factory ltd (1997) 224 ITR 604 [LQ/SC/1997/418] and Mettur Chemical and Industrial Corporation Ltd. v. C. LT. (1996) 217 ITR 768. [LQ/SC/1995/1150] Applying the legislative mandate as reflected in Section 80-B (7) of thecarrying on of a business activity of the priority industry is a must. Business is an organized activity. In the case at hand, assessees stand was one of the captive consumption of the product involved. It has, however, been fairly conceded that the product, which was utilized in the manufacture of cement was lime and not limestone. But thin distinction was sought to be made by submitting that lime is a derivative of limestone and merely because assessees activities were quarrying of limestone that does not take away the direct link necessary for bringing the relief within the umbrella of Section-1 of the. Strong reliance is placed on a decision of the calcutta High Court in C. LT. v. Satna Stone and Lime Co. Ltd. (1982) 138 ITR 37 (Cat). It is submitted that the said case related to lime and limestone, and therefore, fully applicable to this case. Though on a surfacial reading, the argument appears to be attractive, as the decision itself shows that the High Court took note of the factual conclusions recorded by the Tribunal and on the facts held that lime and limestone come out from the same process and if lime does come out of an integrated process or production or manufacture of limestone then the profits derived from such production of lime could be said to be attributable to the production of manufacture of the things or articles mentioned in item 3 of the Sixth Schedule. Item 3 of the sixth Schedule reads as follows :-THE SIXTH SCHEDULE csee Sections 80-BC7) and 80-1)"3. Coal, lignite, iron ore, bauxite, manganese ore, dolomite, limestone, magnesite, and, mineral oil". Cement industry was one of the articles and things mentioned in serial no. 12 in the Sixth Schedule. By an amendment Finance (No. 2) Act, 1971 with effect from 01. 04. 1972, item No. 12, i. e. , "cement and refractories", was omitted from the Sixth Schedule. In the third item, there was no change and limestone was one of the articles. It is to be noted that the undisputed factual position is that an estimated amount for the cost of limestone was reflected in the books of accounts. There was a transfer entry showing the estimated cost for the first time and in the assessment year in question, a new account under the head limestone was started and there was a solitary entry of estimate as a transfer entry in the credit side of the profit and loss account. business in the legal parlance in generic sense means any purposeful activity directed towards some end, an activity engaged in a normal, logical or inevitable and usually extending over a period of time. In the taxing statute, it is used in the sense of an occupation, or profession which occupies the time, attention and labour of a person, normally with the object of making profit. See State of Andhra Pradesh v. H. Ahdul Bakhi, AIR 1965 SC 531 [LQ/SC/1964/134] In the case at hand, there is no evidence of any business of priority industry. A single entry indicating estimated figures for limestone does not per so show conduct of business. Added to that transactions with self cannot be constituted to be a business. It has to be noted that in Lucky Minmat Pvt. Ltd. v. C. L T. (2000) 245 ITR 830 (SC), it was held by the Apex Court that the conversion into lime and lime dust or concrete by stone crushers could legitimately be considered to be a manufacturing process, while the mere mining of limestone and marble and cutting the same before it was sold could not be so considered.

(11). As indicated above, assessees activity was quarrying of the limestone. There is no material-on-record to show that there was some, integrated and/or continuous process from which both lime and limestone came out. That is the distinctive feature so far as the present case is concerned vis-a-vis facts involved in the case before the Calcutta High Court in Satna Stones case (supra). Therefore, factually it cannot be said that there was a direct and proximate link between the profits and gains and the business of the priority industry. Unfortunately neither the aac nor the Tribunal dealt with the factual aspects. Mere reference to an earlier decision of the Tribunal without indicating how the factual position was similar does not serve any purpose. It is the trite law that a decision is an authority for it what decides and not what inferentially may flow from it. Therefore, we have proceeded to decide the matter taking into account the admitted factual position, consequently, there was no income, which could be attributable to the priority industry. Additionally, as was indicated by the Apex Court in India Leathers case (supra), material or part of the income cannot be said to have been earned by that activity. Answer to the question referred is, therefore, in the negative, in favour of. the Revenue and against the assessee.

(12). This reference is accordingly disposed of.