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TMI Blog2016 (7) TMI 287X X X X Extracts X X X X X X X X Extracts X X X X ..... the reasons aforesaid the judgment of the Tribunal cannot be faulted and once it is held that no manufacture was involved in the alleged process, the benefit of Section 13(1)(a) read with Explanation 3 could not be extended to the revisionist. - Decided against the assessee. - TRADE TAX REVISION No. - 52 of 2016 - - - Dated:- 4-7-2016 - Hon'ble Rajan Roy, J. For the Applicant : Om Kumar, Jairam Srivastava For the Opposite Party : C.S.C. ORDER Heard. This is a revision filed by a businessman under Section 58 of the U.P. Value Added Tax Act of 2008 (hereinafter referred as 'Act of 2008') which lies 'on any question of law involved'. The revisionist herein carries on a business of sale and purchase of Eucalyptus wood and bamboo within the State. The revisionist filed a return claiming benefit of Input Tax Credit (I.T.C.) under Section 13 of the Act of 2008 relating to the year 2009-10, which was disallowed by the Assessing Authority. In the first appeal which was partly allowed the claim to I.T.C. carried forwarded was accepted, but the claim of I.T.C. to the extent of ₹ 33,73,939/- was disallowed against which a second appeal was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is also placed on the provisions contained in Section 13(3)(b) to contend that as a consequence of the processing undertaken the waste product or by-product which are produced and are exempt from tax, therefore, it is entitled to full I.T.C. in view of the said provision. The revisionist placed reliance upon the judgment of the Supreme Court reported in (2014)68 VST 498 (SC), Mamta Surgical Cotton Industries v. Assistant (Anti-Evasion), Bhilwara, Rajasthan, and A.I.T. 2015 180 SC, M/s Gujrat Industries ors. V. Commissioner of Central Excise-I, Ahmedabad. It also relies upon the definition of processing as contained in English Dictionaries. Based on the aforesaid it is contended that the learned Tribunal has erred in law in misinterpreting the provisions of Section 13 and Rule 21(1)(a)(f) of the V.A.T. Rules. In view of the above decisions it ought to have affirmed the reversal of I.T.C. where waste products were exempt from Tax, but the main products were liable to tax. Learned Tribunal has affirmed the finding of the first appellate authority that the alleged process of debarking and cutting of wood and bamboo does not result in any new finished commercial item totally d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d is never sold in square meter or cubic meter. The question of applicability of Section 13(1)(a) to Sl.2(ii) of the Table arises only if the taxable goods except non-vat goods purchased are used in manufacture. The term Manufacture has been defined in Section 2(t) of the Act of 2008 as under: 2(t) manufacture means producing, making, mining, collecting, extracting, mixing, blending, altering, ornamenting, finishing, or otherwise processing, treating or adapting any goods; but does not include such manufacture or manufacturing processes as may be prescribed. Except for the inclusion of the words 'mixing' and 'blending' the definition of 'manufacture' under the Act of 2008 is similar to the definition of 'manufacture' contained in Section 2(e-i) of the U.P. Trade Tax Act 1948 which reads as under: 2(e-i). manufacture means producing, making, mining, collecting, extracting, altering, ornamenting, finishing, or otherwise processing, treating or adapting any goods, but does not include such manufactures or manufacturing processes as may be prescribed. The meaning of the word 'manufacture' as it appears in the Trade Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tling. 9. It was also observed : ..... there is hardly less difference between cotton in the field and cotton at the gin or in the bale or between cotton-seed in the field and cotton-seed at the gin, than between a chicken in the pen and one that is dressed. The ginned and baled cotton and the cotton-seed, as well as the dressed chicken, have gone through a processing stage. But neither has been manufactured in the normal sense of the word. 10. Referring to Anheuser-Busch Brewing Assn. v. United States, 52 L Ed 336-338, the court said : Manufacture implies a change, but every change is not manufacture, and yet every change in an article is the result of treatment, labour and manipulation. But something more is necessary ...... There must be transformation; a new and different article must emerge, having a distinctive name, character or use . 11. And further : At some point processing and manufacturing will merge. But where the commodity retains a continuing substantial identity through the processing stage we cannot say that it has been manufactured . Thus, though 'manufacture' implies a change but every change is not a manufacture. Ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of goods would not amount to manufacture unless it results in emergence of a new commercial commodity, therefore, the contention of the petitioner herein that debarking and cutting of wood, removing of roots involve processing of the original product wood and bamboo resulting in a new item, is unacceptable, as, the new item is nothing but wood and bamboo which do not have an identity totally different from the original product nor does it result in emergence of a new commercial commodity. It is not out of place to refer to one of the conclusions drawn by the Supreme Court in the State of Orissa v. Titaghur Paper Mills co. Ltd. ors., 1985 (Supp.) SCC 280 - timber and sized or dressed logs are one and the same commercial commodity. Beams, rafters and planks would also be timber . In the case of sterling Foods v. State of Karnataka, (1986) 3 SCC 469, the Supreme Court states that frozen shrim/s, prawns and lobsters are not new and distinct commodity, but they retain the same character and identity as the raw shrim/s, prawns and lobsters. As far as reliance placed by the revisionist upon the judgment of the Supreme Court in Mamta Surgical Cotton Industries Rajasthan v. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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