TMI Blog2000 (10) TMI 944X X X X Extracts X X X X X X X X Extracts X X X X ..... short, "the KST Act") and KTEG Act. The respondent is engaged in the activity of mixing fertilisers and selling fertiliser mixtures. 2. The respondent causes entry of several chemical fertilisers (urea, ammonium sulphate, calcium nitrate, ammonium nitrate, etc.,) into various local areas in Karnataka and mixes them in the proportions prescribed in the Fertiliser (Control) Order, 1985 and sells the mixtures known as 'NPK mixture' (i.e., nitro-phosphate with potash mixture). The respondent caused the entry of raw materials of the value of Rs. 1,00,20,794.00, during the period August 1, 1992 to March 31, 1993 and raw materials of the value of Rs. 1,49,79,141.00 during the period April 1, 1993 to March 31, 1994. The assessing authority, b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om the several fertilisers which form the component parts of the fertiliser mixtures and therefore the fertiliser mixture should be treated as an article different and distinct from the several component fertilisers that go into making of the fertiliser mixture. 5.. Feeling aggrieved, respondent herein filed appeals before the Karnataka Appellate Tribunal in KTEG Appeal Nos. 31 and 32 of 1999 under section 14 of the KTEG Act. The Tribunal by its common order dated December 10, 1999, allowed the appeals, holding that there is no manufacture of a different commodity by mixing different kinds of fertilisers, and therefore the fertilisers, which are purchased and used in the fertilisers mixture; and as there is no manufacturing of a new produ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2) read with item No. 21 of the First Schedule to the said Act, the fertiliser mixture could not be taxed again. The High Court disallowed the appellant's claim. On appeal, the Supreme Court confirmed the decision of the High Court, holding (i) that it was only when a chemical fertiliser specified in sub-items (1) to (15) of item No. 21 of the First Schedule was sold in the same condition, in which it was purchased, that it was not subject to a fresh levy; and (ii) that the question whether there was any manufacturing process involved in the preparation of any fertiliser mixture or whether shovel mixing of the chemical fertilisers amounted to manufacture or not was wholly irrelevant for the purpose of the determination of the question arisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f India [1981] 47 STC 124. The Supreme Court held as follows: "The point which arises for consideration under the first question is as to whether blending of ore in the course of loading it into the ship through the mechanical ore handling plant constituted manufacture or processing of ore. Now it is well-settled as a result of several decisions of this Court, the latest being the decision given on 9th May, 1980, in Civil Appeal No. 2398 of 1978, Deputy Commissioner of Sales Tax v. Pio Food Packers reported in [1980] 46 STC 63 (SC); AIR 1980 SC 1227, that the test for determining whether manufacture can be said to have taken place is whether the commodity which is subjected to the process of manufacture can no longer be regarded as the or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is blended and hence it cannot be said that any process of manufacture is involved in blending of ore." 10.. The principles laid down in Chowgule's case [1981] 47 STC 124 (SC) apply to this case. Several fertilisers are mixed to produce a fertiliser mixture. The end-product of mixing several chemical fertilisers is also a chemical fertiliser. In fact, it does not have a different commercial name but is called as NPK (nitrophosphate with potash) mixture. The Fertiliser (Control) Order, 1985 specifies different maximum prices for different blends or mixtures of chemical fertilisers, which are used for different types of soils or for growing different kinds of agricultural produce. But the products which go into mixture, and the mixture, are ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
