9911796707
TMI Blog2017 (12) TMI 621X X X X Extracts X X X X X X X X Extracts X X X X ..... nversion of wet blue into finished leather. The Assessing Officer was of the view that there was no manufacturing activity involved in conversion of wet blue hides into finished leather and hence, the dealers were not eligible to purchase chemical against Form XVII at concessional rate. Therefore, the Assessing Officer levied differential rate of tax of 9% on Rs. 44,662/- and also surcharge. He also levied penalty under section 23 of the TNGST Act, 1959, at Rs. 2,110/-. 3. Aggrieved against the order of the Assessing Officer, the respondent filed an appeal before the Appellate Deputy Commissioner (CT), who allowed the appeal. Against which, the Joint Commissioner (CT), Chennai (Central) Division, Chennai, petitioner herein, has preferred appeal in S.T.A.No.120 of 2011, before the Tamil Nadu Sales Tax Appellate Tribunal (Main Bench), Chennai. Following the decision of this Court in Golden Leathers v. Secretary, TNSTAT reported in [2010] 35 VST 216 (Mad.), on 14.08.2012, the Appellate Tribunal, has passed the following orders, "Heard both sides. At the time of hearing, the learned State Representative (F AC) has argued that already similar issue has been decided by our Honourable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... il court Buildings, II Floor, Chennai-l04 and 3 others which was numbered as Writ petition of 3000/2008 has been disposed of by our Honourable Division Bench dated 22.04.2010. This judgment was relied on by the first appellate authority for allowing the appeal. In that judgment, our Honourable High Court has discussed this point as follows: "The Tribunal did not take note of the factual findings of the Appellate Assistant Commissioner (CT) who had not only referred to various stages, which the wet blue leather undergoes and becomes finished leather, but also the fact that each activity is known in the industry with different names. One is called the full-fledged unit, by which, the raw hides and skins get transformed into finished leather, but the other is called the wet unit and the third is called the dry unit. It is after discussion these facts the Appellate Assistant Commissioner (CT) came to the conclusion that a manufacturing activity takes place. The Tribunal appears to have been persuaded by the fact that in item 7B of schedule 11 to the Act, the two categories of leather that are mentioned in the entry are 'raw hides and skins' and 'dressed hides and skins&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reported in 15 STC 719 and in the case of State of Tamil Nadu v. Mahi Traders & Others reported in 73 STC 228, admittedly cited on behalf of the Revenue in para 6 of the impugned judgment ? 2) Whether the order of Tribunal is perverse in its factual finding that process involved in the conversion of wet blue leather (also known as tanned leather or semi finished leather) into finished leather amount to manufacture by overlooking the factual findings regarding the process underwent in the conversion of raw hides and skins into dressed hides and skins as approved in the case of Hajee Abdul Shukoor v. State of Madras reported in 15 STC 719 and in the case of State of Tamil Nadu v. Mahi Traders and Others reported in 73 STC 228 ? 3) Whether the Tribunal has corrected appreciated and applied the principles laid down by Supreme Court in the decisions relied upon in the impugned judgment to the facts of the present case inasmuch as wet blue leather does not admittedly constitute a raw material for manufacture of finished leather ? 4) Whether the order of the Tribunal is perverse inasmuch as the processes which the wet blue leather is subjected to would not alter but retain the esse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tanning is done, the leather becomes non putrescible and the leather attains its character, nature and use and therefore ready for use. In view of the above, it is submitted that hides and skins, after under going process including tanning become dressed hides and skins, which are also tanned leather after under going refining process, according to the needs of the leather industries. The Tribunal ought to have followed the aforesaid principles of law. (f) The Tribunal ought to have followed the principle laid down in the judgement of this Court in 73 STC 228 and 15 STC 719. (g) The Tribunal ought to have considered that manufacture implies a change, but every change is not manufacture and 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 distinct name character or use. Applying the above yardstick, mere process on wet blue leather does not bring out a new distinct commodity, since dressed hides and skins, are nothing but, making ready for multifarious users depending upon specific requirements, at same time, retaining the common bond of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, a manufacturing activity takes place. The change or series of changes take the wet blue to a point where it can no longer be regarded as wet blue but must be recognized as finisher leather. So there is a manufacture. This question must be decided on the facts and circumstances of each case that comes up for consideration, the processes that the particular goods pass through and whether they get converted or not and whether the inputs are used for such activity. In this case, we are satisfied that the activity amounts to a manufacturing activity."
6. In the case on hand, wet blue (semi-finished) leather has been converted into finished leather. Golden Leathers' case (cites supra) squarely applies to the case on hand and we have no hesitation to hold that the process of conversion of wet blue (semi-finished) leather into finished leather, amounts to an manufacturing activity.
7. Following Golden Leathers' case (cites supra), this Court is inclined to dismiss this tax case revision petition, as no question of law, much less substantial question of law, arises for consideration in the present revision.
8. In the result, the Tax Case Revision is dismissed. No Costs. X X X X Extracts X X X X X X X X Extracts X X X X
|
