9911796707
TMI Blog2008 (11) TMI 646X X X X Extracts X X X X X X X X Extracts X X X X ..... n not granting exemption on agricultural products of other States when such an issue is not at all existing in this case? 3.. Whether the Tribunal has erred in not considering the finding of the first appellate authority that in deciding the liability of tax upon the respondent the question whether the purchaser had paid tax or not is immaterial since coffee seeds are taxable at the point of first sale? 4. Whether the consequent deletion of penalty levied under section 16(2) of the Tamil Nadu General Sales Tax Act, 1959 (the TNGST Act) is valid in law?" The assessee is a dealer in coffee. They have estates in Karnataka. Their administrative office is in Coimbatore and they have registered as dealers under the TNGST Act with effect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Income-tax reported in [2002] 125 STC 101 (SC); [2001] 251 ITR 323 (SC). Mr. Inbarajan, the learned counsel for the assessee, filed a typed set of papers which contains the statement made by the power-of-attorney holder of the assessee, written submissions, purchase bills, etc. According to him, the sale of coffee seeds cannot be included in the taxable turnover in view of the definition of 2(r) and what was sold was only uncured coffee. The coffee seeds had not been subjected to any physical, chemical or other process and except for mere cleaning, sorting or drying it remains an agricultural or horticultural produce as it was grown by the assessee on lands belonging to himself and therefore, the same should be excluded from tax. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... specialised or skilful process as that of 'curing'. 21. In view of the above discussion, we are of the view that there is absolutely no material so as to interfere with the concurrent finding of fact that the activity of 'curing' of agricultural produce 'cardamom' cannot be considered as mere drying, but it could be considered as 'not only drying, but also preserving the aroma and flavour and also giving shining'. In such circumstances, the saving clause of mere cleaning, grading, sorting and drying in Explanation (1) to section 2(r) of the TNGST Act would not come to the rescue of the petitioner so as to conclude that the fresh green 'cardamom', which has been subjected to the process of 'curin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sheds, etc., are located. . . . 15. Adverting to the facts of the present case, the assessee, after plucking or receiving the raw coffee berries makes it undergo nine processes to give it the shape of coffee beans. The net product is absolutely different and separate from the input. The change made in the article results in a new and different article which is recognised in the trade as a new and distinct commodity. The coffee beans have an independent identity distinct from the raw material from which it was manufactured. A distinct change comes about in the finished product. 16. The submission of learned counsel for the Revenue that the assessee was doing only the processing work and was not involved in the manufacture and producing of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he lands in which the assessee had an interest whether as owner, usufructuary mortgagee or tenant, so that section 2(r) would apply. In fact, it is seen that the stand that coffee seeds are grown in the assessee's own lands is taken for the first time before us. In these circumstances, we cannot fault the Revenue for not dealing with the question whether uncured coffee was different from coffee seeds that are grown on the estates allegedly belonging to the assessee. We leave this issue open since there are no factual findings by the fact-finding authority for us to decide it. The Tribunal ought not to have gone into the question whether there was discrimination on the ground of exemption on agricultural products of other States and ag ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
