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Satyanarayana Publishing House Vs. Commissioner of Income-tax - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtAndhra Pradesh High Court
Decided On
Case NumberCase Referred No. 201 of 1976
Judge
Reported in[1979]118ITR519(AP)
ActsIncome Tax Act, 1961 - Sections 80QQ
AppellantSatyanarayana Publishing House
RespondentCommissioner of Income-tax
Appellant AdvocateY.V. Anjaneyulu and ;K. Lakshminarayana, Advs.
Respondent AdvocateP. Rama Rao, Adv.
Excerpt:
.....- question involved that whether assessee a publishing house entitled to have 20% deduction on books printed by it - respondent contended that guide books printed by assessee not covered within term 'book' mentioned in section 80qq - high court observed that main object of section 80qq is to encourage publishing of books in india - in view of above object and precedent decided guide books printed and published by assessee come within meaning of 'books' mentioned in section 80qq - held, assessee entitled to get deduction. - all india services act, 1951. sections 32(c) (as amended by section 3 of amendment act, 2005] & 10 & general clauses act, 1897, section 6: [g.s. singhvi, cj, dr.g. yethirajulu, ramesh ranganathan, g.bhavani prasad, c.v. nagarjuna reddy, jj] exemption of building..........printing and publication of books. the ito disallowed the deduction claimed on the ground that the books published by him are not of the type of books which are entitled to deduction under the provisions of section 80qq. that view of the ito was not upheld by the aac. hence, the revenue preferred an appeal to the tribunal and the tribunal, on the ground that the books printed and published by the assessee were not of enduring value, reversed the order of the aac and restored the order of the ito. the assessee, therefore, had the case referred to this court under section 256(f) of the i.t. act. the short question, therefore, is whether the assessee is entitled to the benefit of section 80qq of the act which is, to the extent relevant, in these terms :'(1) where in the case of an assessee.....
Judgment:

S. Obul Reddy, C.J.

1. The question referred for our opinion is as under :

'Whether, on the facts and in the circumstances of the case, the assessee is entitled to deduction of 20% of the income derived from printing and publishing books for school and college under Section 80QQ of the Income-tax Act, 1961 ?'

2. The facts necessary for answering the question are these : The assessee is a firm known as Messrs. Sri Satyanarayana Publishing House, Rajahmundry. For the assessment year 1971-72 the assessee claimed a deduction of 20% of the income under Section 80QQ of the Act on the sales, printing and publication of books. The ITO disallowed the deduction claimed on the ground that the books published by him are not of the type of books which are entitled to deduction under the provisions of Section 80QQ. That view of the ITO was not upheld by the AAC. Hence, the revenue preferred an appeal to the Tribunal and the Tribunal, on the ground that the books printed and published by the assessee were not of enduring value, reversed the order of the AAC and restored the order of the ITO. The assessee, therefore, had the case referred to this court under Section 256(f) of the I.T. Act. The short question, therefore, is whether the assessee is entitled to the benefit of Section 80QQ of the Act which is, to the extent relevant, in these terms :

'(1) Where in the case of an assessee the gross total income of the previous year relevant to the assessment year commencing on the 1st day of April, 1971, or to any one of the nine assessment years next following that assessment year, includes any profits and gains derived from a business carried on in India of printing and publication of books, or publication of books, there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the total income of the assessee, a deduction from such profits and gains of an amount equal to twenty per cent. thereof......

(3) For the purposes of this section, 'books' shall not include newspapers, journals, magazines, diaries, brochures, tracts, pamphlets and other publications of a similar nature, by whatever name called.'

3. The expression 'book' is not defined in the Act. We have, therefore, to interpret that expression having regard to the context in which that word occurs in Section 80QQ. It is not the case of the revenue that the guide books printed and published by the assessee come within any of the categories of journals, brochures, tracts or pamphlets. Obviously, the Tribunal has put the books published by the assessee in the category of 'other publications of a similar nature by whatever name called'. The other publications referred to in Section 80QQ are referable only to newspapers, journals, magazines, diaries, brochures, tracts, pamphlets and not to books. The books printed are not short printed works of a few leaves stitched together to be included in the category of brochures, nor do they relate to any particular topic or treatise or a printed discourse to be classified as coming within the expression 'tract'. The fact that the legislature has used the words 'other publications of a similar nature, by whatever name called' will not by itself take the guide books within the sweep of other publications of similar nature. Books are placed in a special category in Section 80QQ. All that is required for deduction under Section 80QQ is that the assessee must have derived profits and gains from the business of printing and publication of books or publication of books. The expression 'book' as defined in Webster's Third New International Dictionary (Unabridged) 1966 means 'a collection of written, printed or blank sheets fastened together along one edge and usually trimmed at the other edges to form a single series of uniform leaves ; specifically a collection of folded sheets bearing printing or writing that have been cut and sewn and usually bound between covers into a volume ; a stack of sheets of paper interleaved alternatively with the material whose finish the paper acquires after it passes through the plater; the printed but unfolded and uncut sheets for a Book ; a longsystematic literary composition ; a major division of a treatise or literary work ; any of the records (as the day book, cash book, sales book, journal, ledger) in which a systematic record of business transactions may be kept'. The dictionary meaning of the word 'book' is no doubt comprehensive enough to take even journals and treatises which are taken out of the category of books by the Legislature in Sub-section (3) of Section 80QQ. While interpreting the word 'books' we have to bear in mind the meaning of the expression as understood in common parlance. This court, in Govindaswamy Binding Works v. State of Andhra Pradesh [1972] 29 STC 219 (AP), had occasion to consider the meaning of the expression ' book ' and it held that the expression 'book' is comprehensive enough to take in all kinds of books. In view of the fact that certain other categories which are defined in dictionaries are not included in the expression 'books', it is clear that the word 'books' has a definite meaning. The guide books are printed and published by the assessee for the benefit of the students and as may be seen from the facts stated in the order of the Tribunal there are several reprints of these guides. These guides are printed for the subjects like Mathematics, English, Science, Telugu, etc. The question is not whether the books printed are of enduring value, but whether they answer the description of 'books'. In re Tomline's Will Trusts: Pretyman v. Pretyman [1931] 1 Ch 521 (Ch D) Maugham J. held that manuscripts would also come within the meaning of the word 'books'. The reasons given by him for coming to that conclusion are :

'The volumes are in book form ; to the outward eye they look like books, and in the ordinary course they can be, and are, handled like books. Next, I observe that they can be used like books, in the sense that, as one turns over the sheets, one can, if able to decipher the handwriting, read the various letters as a collection of letters bound up in the books. I observe further that they are not detachable letters in the ordinary sense, but they have been so inserted in the sheets that they are in substance permanent parts of the volumes, unless, indeed, they should be cut out or removed by some forcible effort.'

4. The guide books printed by the assessee are priced and sold at bookstalls and are purchased by the school and college going students. It is not necessary that, to answer the description of a book, a book should have wide sales or should be in circulation all over the country. All that we have to see is whether they are printed and published and whether they answer the description of 'book'. These guides, though they may contain summaries of text-books or may be in the form of questions and answers, the printed sheets are bound and sold in volumes and they undergo several reprints. Therefore, it cannot be said that the guide books sold by the assessee to the student community do not answerthe description of books in Section 80QQ. Nowhere do we get from the language of Section 80QQ, as understood by the ITO, that the object of granting concession under the provision was to encourage a publication of books in India which would replace the books which have been imported from foreign countries. The question is also not whether these books are useful for a period of four or five years, but whether they are, in fact, books. The question how long they are useful is not relevant. Having regard to the opinion expressed by this court earlier in Govindaswamy Binding Works v. State of Andhra Pradesh [1972] 29 STC 219 (AP), we hold that the guide books published by the assessee come within the meaning of the term 'books' in Section 80QQ of the Act. We, therefore, answer the question in the affirmative and in favour of the assessee with costs. Advocate's fee Rs. 250.


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