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2023 (5) TMI 648 - HC - VAT and Sales TaxRebate on Input Tax paid on diesel - activity of crushing the boulders into gitti amounts to manufacturing (or not) and for this process, diesel is used as raw material - interpretation of Section 14(1AC) of MP VAT Act - HELD THAT:- The learned Appellate Tribunal has considered the first contention of the appellant about the activities of stone crushing is amount to manufacture or not. According to the Tribunal, the appellant is only changing the size of stones from boulder to gitti, hence, there is no change in its character by reducing the size. The manufacturing includes any activities that bring out a change in final product. The Apex court in the case of COMMISSIONER OF SALES TAX, UP. VERSUS LAL KUNWA STONE CRUSHER (P) LTD. [2000 (3) TMI 58 - SUPREME COURT] held that Even if gitti, kankar, stone ballast, etc. may all be looked upon as separate in commercial character from stone boulders offered for sale in the market, yet it cannot be presumed that Entry 40 of the notification is intended to describe the same as not stone at all. In fact the term “stone” is wide enough to include the various forms such as gitti, kankar, stone ballast. The above view has been affirmed in the case of STATE OF MAHARASHTRA VERSUS MAHALAXMI STORES [2002 (11) TMI 112 - SUPREME COURT] where it was held that From a perusal of the definition, extracted above, it is clear that the processes of producing, making, extracting, altering, ornamenting, finishing or otherwise processing, treating or adapting of any goods fall within the meaning of the term “manufacture”. But it may be pointed out that every type of variation of the goods or finishing of goods would not amount to manufacture unless it results in emergence of a new commercial commodity. In the instant case, the very nature of the activity does not result in manufacture because no new commercial commodity comes into existence. Claim of ITR for the purchase of diesel - HELD THAT:- The appellant used to purchase diesel to run the crusher machine and not as a raw material to manufacture the gitti. ITR can be allowed only to the registered dealers on the purchase of goods specified in Schedule – II within the State. The appellant is not a dealer engaged in the sale or purchase of diesel, therefore, the Tribunal has not committed any error in interpreting Sections 14 and 14(1AC) of the Act of 2002. Diesel is covered in Part – III – A of Schedule – II and Part – II of Schedule – II does not cover petrol and diesel. As such, there are no errors in the finding recorded by the Assessing Authority, First Appellate Authority as well as Tribunal. Appeal dismissed.
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