Bourne (Inspector of Taxes) v Norwich Crematorium Ltd [1967]
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Bourne (Inspector of Taxes) v Norwich Crematorium Ltd [1967] 2 All ER 576 revolves around the interpretation of tax law concerning the eligibility for an income tax allowance under the Income Tax Act, 1952. The taxpayer company, which operated a crematorium, sought an annual allowance for expenditure incurred in the construction of its furnace chamber and chimney tower. These structures, integral to the crematorium's operation, were built in 1936-37 at a cost of £2,157. The company argued that these facilities should qualify as an "industrial building or structure" under Section 271(1)(c) of the Income Tax Act 1952.
The core issue in the case was whether the process carried out within the crematorium, specifically the burning of human corpses, could be considered "the subjection of goods or materials to any process" as outlined in the relevant tax legislation. The taxpayer company contended that the furnace chamber and chimney tower were used in an industrial process and therefore should qualify for the allowance.
However, the court, presided over by Stamp J, held that the consumption by fire of a human body does not constitute "the subjection of goods or materials to any process" within the meaning of the statute. The court reasoned that a human corpse cannot be equated with goods or materials, and thus the activities carried out in the furnace chamber and chimney tower did not meet the criteria for the building or structure to be classified as industrial. As a result, the taxpayer company's claim for the allowance was denied.
This decision underscores the importance of precise statutory interpretation, particularly when it comes to tax law. The ruling clarified that certain processes, even those involving specialised equipment and facilities, do not necessarily meet the legal definition of industrial activity if they do not involve the treatment of goods or materials as understood in the context of the statute. The case serves as a significant reference point for the interpretation of tax allowances related to industrial buildings or structures.
The core issue in the case was whether the process carried out within the crematorium, specifically the burning of human corpses, could be considered "the subjection of goods or materials to any process" as outlined in the relevant tax legislation. The taxpayer company contended that the furnace chamber and chimney tower were used in an industrial process and therefore should qualify for the allowance.
However, the court, presided over by Stamp J, held that the consumption by fire of a human body does not constitute "the subjection of goods or materials to any process" within the meaning of the statute. The court reasoned that a human corpse cannot be equated with goods or materials, and thus the activities carried out in the furnace chamber and chimney tower did not meet the criteria for the building or structure to be classified as industrial. As a result, the taxpayer company's claim for the allowance was denied.
This decision underscores the importance of precise statutory interpretation, particularly when it comes to tax law. The ruling clarified that certain processes, even those involving specialised equipment and facilities, do not necessarily meet the legal definition of industrial activity if they do not involve the treatment of goods or materials as understood in the context of the statute. The case serves as a significant reference point for the interpretation of tax allowances related to industrial buildings or structures.
