1. The only question for consideration in this appeal is whether the assessee-company is entitled to depreciation under Section 32(1)(vi) of the Income-tax Act, 1961 ('the Act').
2. The assessee-company is engaged in the business of laying down pipelines for the Municipal Corporation. It maintains its accounts on mercantile basis. For the assessment year 1976-77, it claimed initial depreciation under Section 32(1)(vi), for the machinery purchased and used by it in its business. The ITO rejected the claim of the assessce on the ground that the assessee was not engaged in the business of 'manufacture' or 'production' of any of the articles specified in the Ninth Schedule to the Act. On appeal, the AAC confirmed the order of the ITO. The assessee has, therefore, filed the present appeal.
3. Before me, the learned representative of the assessee contended that the laying down of pipes, after joining them together, tantamoimted to 'manufacture' or 'production' of articles within the meaning of Section 32(1)(vi). According to him, the long joint pipes resulting from the joining of the smaller pipes were different from their components and since a new product emerged out of the original constituents, the process involved 'manufacture' or 'production' of articles. In support of his contention, he referred to the decision of the Bombay High Court in the case of CIT v. Tata Locomotive and Engineering Co. Ltd.  68 ITR 325 and also to the decision of the Tribunal in the case of ABC v. ITO [IT Appeal Nos. 3261 to 3263 (Bom) of 1979].
4. The learned representative of the department on the other hand, contended that the assessee was only engaged in the business of joining together the small pipes and laying down the same, that the original 'pipes' still remained 'pipes' even afterwards and as such, the assessee was not engaged in the 'manufacture' or 'production' of any article. According to him, therefore, the assessee was not entitled to initial depreciation under Section 32(1)(vi). In support of his case, he relied upon the decision of the Kerala High Court in the case of CIT v. Casino (P.) Ltd.  91 ITR 289.
5. After going through the record and hearing the learned representatives of the parties, I do not find any merit in this appeal.
The assessee-company is entitled to depreciation on new machinery under Section 32(1)(vi) only if it is engaged in the 'manufacture' or 'production' of any of the articles mentioned in (the Ninth Schedule to the Act. Now, the term 'manufacture' or 'production' has not been defined in the Act. The Corpus Juris Secundum defines 'manufacture' as "the production of articles for use from raw or prepared materials by giving these materials new forms, qualities or combinations by hand, labour or machinery". According to Webster's Dictionary 'to manufacture' means "to work as raw or partly wrought materials into suitable forms for use". Thus, the expression 'manufacture' means the transformation or change of raw material into a changed form for use.
It has been held by the Kerala High Court in the case of Casino (P.) Ltd. (supra) that the expression 'manufacture', in its ordinary meaning, is a process which results in an alteration or change in the good which are subject to manufacture. According to this authority, the real test is whether a commodity which, in commercial sense, is different from the raw material has resulted due to the manufacture.
Now, in the present case, the assessee does not 'manufacture' or 'produce' pipes as such. All that the assessee does is to join the pipes together and lay them as 'pipes'. The pipes remain pipes and no new article, different from its components, comes into existence. In my opinion, therefore, the assessee is not engaged in the business of 'manufacture' or 'production' of any article within the meaning of Section 32(1)(vi). This view derives support from various other authorities. In the case of CIT v. Hindusthan Metal Refining Works (P.) Ltd.  128 ITR 472 (Cal.), galvanising or coating iron and steel with zinc to protect it from rust did not result in the manufacture of new goods. Again, it has been held in the case of Ramesh Chemical Industries v. Union of India 1980 Tax LR 2327 (MP) that buying glucose in bulk and re-packing the same in small quantities for sale does not amount to manufacture. Further, according to the decision in the case of Mohanlal v. CST  24 STC 100 the activity of felling timber and converting the same into 'ballis' does not amount to manufacture.
Similarly, the making of garlands and bonquets from flowers does not amount to 'manufacture' as held in the case of Sudhir Ch. Mukherjee v.Addl. GST  37 STC 554 (Cal).
6. The authorities cited by the learned representative of the assessee are distinguishable. In the case of TELCO (supra) it was held that the assembling of automotive bus and truck chassis from imported parts in a 'knocked down' condition would give rise to an article which was totally different from the parts and would amount to manufacture.
Evidently, the component parts which were assembled brought into existence a new and different article, i.e., an automobile which had its own entity. In the present case, the position is different. The component parts, i.e., pipes remain pipes even after being joined together. Thus, the authority cited by the assessee does not help the assessee. Similarly, the decision of the Tribunal in the case of ABC (supra) is of no avail to the assessee. In that case, the process of making sweet-meats from raw materials was held to be 'manufacture' of goods. There too, the new article which came into existence had its own identity, different from its components. As stated above, this is not so in the present case. I am, therefore, of the opinion that the authorities cited on behalf of the assessee do not advance its case.
7. In view of the above discussion, I conclude that the authorities below have rightly disallowed the claim of the assessee under Section 32(1)(vi). The impugned order is, accordingly, confirmed.