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TMI Blog2004 (6) TMI 605X X X X Extracts X X X X X X X X Extracts X X X X ..... has already been subjected to tax. However, its claim was rejected by the assessing authority vide assessment order dated March 31, 1999 (annexure 1). Being aggrieved, the revisionist/assessee preferred the appeal which was dismissed vide order dated July 19, 2001 (annexure 2) by the appellate authority. The assessee further preferred the second appeal before the Tribunal, wherein the matter was referred to the Larger Bench, i.e., the five-member Bench, which has been decided against the assessee vide impugned order dated March 16, 2004 (annexure 4). Hence this revision. Heard Shri C.L. Pandey, learned counsel for the revisionist and Shri S.M.A. Kazmi, learned Chief Standing Counsel with Shri S.P. Kesarwani, Advocate for the Revenue. It has been submitted by Shri Pandey that the assessee cannot be fastened with the liability of tax for the reason that the coal-briquettes is the same as the coal, though produced by moulding coal dust with multani mitti/molasses in coal coke form, certainly using certain machines. Notification No. ST-II-5782, dated September 7, 1981, issued under section 3-A of the Act provided that coal included coke in all its forms, but excluded charcoal. The s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en to the word "coal" in Blackies' Concise Dictionary, New Edition, page 134, reads as follows: "Coal: Kol: A piece of wood or other combustible substance burning or charred: charcoal; a cinder; now, usually a solid black substance found in the earth, largely employed as fuel, and formed from vast masses of vegetable matter deposited through the luxurious growth of plants in former epochs of the earth's history." The Shorter Oxford English Dictionary at pages 330 and 331 gives the meaning of coal as follows: "(1) A piece of carbon glowing without a flame. (2) A piece of burnt wood, etc., that is still capable of combustion without flame, cinder, ashes. (3) Charcoal. (4) A mineral, solid, hard, opaque, black or blackish, found in seams in the earth, and largely used as fuel; it consists of carbonised vegetable matter." At page 293, the said Dictionary gives the meaning of charcoal as follows: "The suggestion that Char-Chare v. or sb. As if turn-coal, i.e., wood turned into coal, lacks support. 1. The black porous residue, consisting (when pure) wholly of carbon, obtained from partly burnt wood, bones, etc. Hence specified as wood, vegetable, animal, etc." The Webster's N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ypes of coal. The tiklis are manufactured by compiling the hard coke breeze mechanically with the help of cinders which is complied with the help of clay, molasses or calex-powder. It is being used in the houses for cooking purpose. The term manufacture has been defined under section 2(e-1) of the Act as under: " 'Manufacture' means producing, making, mining, collecting, extracting, altering, ornamenting, finishing or otherwise processing, treating or adapting any goods; but does not include such manufacture or manufacturing processes as may be prescribed." The definition is very wide and the honourable apex Court explained the term "manufacture" in B.P. Oil Mills Ltd. v. Sales Tax Tribunal [1998] 111 STC 188; 1998 UPTC 1020; AIR 1998 SC 3055, observing that when the provisions of section 3(3)(b)(ii) and (iii) of the Act are read in juxtaposition, with the definition of "manufacture" in section 2(e-1) it becomes abundantly clear that a dealer will be liable to pay tax on sale of any goods he manufactures by processing the goods he purchased complying with the requirements of clause (ii) of sub-section (3) of section 3 of the Act. The said provision clearly provides that tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tatutes do not apply unless the definition of that word in the particular statute under consideration is similar to that construed in the decisions. The plain construction of the special definition of the word in a particular Act must prevail. In the special definition given in section 2(j) of the said Act 'manufacture' has been defined as including a process or manner of producing, collecting, extracting, preparing or making any goods. There can be no doubt whatsoever that 'collecting' goods does not result in the production of a new article. There is, therefore, inherent evidence in the definition itself that the narrow meaning of the word 'manufacture' was not intended to be applied in the said Act. Again, the definition speaks of 'the process of lopping the branches (of trees), cutting the trunks'. The lopping of branches and the cutting of trunks of trees also, self evidently, does not produce a new article. The clear words of the definition, therefore, must be given due weight and cannot be overlooked merely because in other contexts the word 'manufacture' has been judicially held to refer to the process of manufacture of new articles." In Deputy Commissioner of Sales Tax ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erent article. Processing essentially effectuates a change in form, contour, physical appearance or chemical combination or otherwise by artificial or natural means and in its more complicated form involves progressive action in performing, producing or making something (Vide Corn Products Refining Co. v. Federal Trade Commission 1994 CCA 7; 144 F 2d 211)," In Union of India v. Delhi Cloth and General Mills Co. Ltd. AIR 1963 SC 791, the honourable apex Court explained the word "manufacture" used as a verb which is generally understood to mean as bringing into existence of a new substance and does not mean merely to bring some change in a substance, however, minor in consequence the change may be. In a manufacture, there must be transformation and different article must emerge having a distinctive name, character or use. Similar view has been reiterated in Rajasthan State Electricity Board v. Associated Stone Industries [2000] 6 SCC 141. In State of Maharashtra v. Mahalaxmi Stores [2003] 129 STC 79 (SC); [2003] 1 SCC 70, the apex Court held that processing or variation of the goods or finishing of goods would not amount to manufacture unless it results in emergence of a new ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been carried on in respect of goods originally produced the ornamented goods will have to be treated as goods which have again been manufactured. It was emphasised that whether the commercial identity of the goods subjected to process of "manufacture" changes or not, does not appear to be very material. Had the Legislature intended that it would have contented itself by defining in section 2(e-1) of the Act the phrase "manufacture" to mean producing or making (in which case it might have been possible to urge that the goods produced or made should be commercially different from the goods from which they are produced or made) and it would not have included within its ambit, mixing, collecting, extracting, altering, ornamenting, finishing or otherwise processing, treating and adapting of goods in which cases generally the commercial identity of the concerned goods do not despite being subjected to such processes, undergo any change. Therefore, the artificial definition of the term "manufacture" as contained in the Act has to be considered in a different perspective as held by this court in Commissioner of Sales Tax v. Kanpur Glass House 1985 UPTC 1261 that if the Legislature has no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied by the Notification No. ST-II-1093/XI-7(42)-68-UP Act-XV/ 48-Order-90, dated July 27, 1991 and annexure II thereof provides list of industries not entitled to the facility of exemption from or reduction in rate of tax which includes, at serial No. 11, the coal powder, fire wood, coal briquettes and charcoal manufacturing units. A similar situation emerges from Notification No. TT-2-780/XI-9(226)/ 94 U.P. Act 15/48-Order-95, dated March 31, 1995 and annexure II thereof provides list of industries not entitled to the facility of exemption from or reduction in rate of tax which includes at serial No. 5, the coal powder, fire wood, coal briquettes and charcoal manufacturing units. In K.A.K. Anwar Co. v. State of Tamil Nadu [1998] 108 STC 258 (SC), the honourable Supreme Court considered the issue as to whether the turnover in respect of hides and skins, subjected to tax under the State Act on its purchase at the raw stage, could be taxed again on inter-State sales as tanned or dressed hides and skins. The apex Court after considering large number of its earlier judgments held that merely because different goods or commodities are listed together in the same sub-heading or sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State of U.P. [1996] 3 UPLBEC 1561, has been under challenge. The said case was in respect of levy of fee by the Mandi Samiti under the provisions of the U.P. Krishi Utpadan Mandi Adhiniyam, 1964 (hereinafter called "the Act, 1964") and the issue involved therein had been as to whether skin and hides even after going through the manufacturing process, remained the agricultural produce or not. The honourable apex Court held that the case was required to be interpreted under the provisions of section 2(a) of the Act, 1964 which defined "agricultural produce". As that was not the case under the Sales Tax Act, no assistance can be taken therefrom. In view of the above, the position can be summarised that the term "manufacture" generally means bringing into existence a new commercial commodity. However, it is not a formula of universal application. The artificial definition of the said term may be wide enough requiring no such condition. It may not always be necessary that after going through the process of manufacturing, a new commercial commodity comes into existence. It depends upon the language used by the Legislature in defining the term "manufacture ", as explained above. In cer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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