TMI Blog1962 (11) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... by that date, according to them their turnover had exceeded Rs. 25,000. The Sales Tax Officer in his order dated 11th July, 1955, took the view that the respondents were liable as dealers who processed goods with effect from Ist April when their turnover was taken to have exceeded Rs. 10,000. The matter went in appeal before the Assistant Collector of Sales Tax who set aside the assessment by his order dated 9th July, 1956. Thereafter the Additional Collector of Sales Tax in exercise of his powers of revision, by his order dated 19th May, 1958, held that the respondents were dealers who processed goods and restored the assessment order passed by the Sales Tax Officer. The matter was carried further before the Sales Tax Tribunal. The Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceeds- (i) * * * * (ii) in the case of a dealer who produces, collects, extracts, manufactures or processes any goods, Rs. 10,000, provided that the value of the goods produced, collected, extracted, manufactured or processed during the said period is not less than Rs. 2,500; shall be liable to pay the tax under this Act on his turnover of sales and his turnover of purchases made on or after the appointed day." The question that we have to determine is whether it could be said that the respondents in this case have processed any goods or produced or manufactured any goods. The term "process" has been used in the section as a transitive verb. In Webster's New World Dictionary, the meaning of the word "process" used as a transitive verb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bjecting it to some processing, is consumption within the meaning of the Explanation to Article 286 no less than the final act of user when no distinct commodity is being brought into existence but what was brought into existence is being used up." It is further stated as follows: "We think it proper and reasonable to say that whenever a commodity is so dealt with as to change it into another commercial commodity there is consumption of the first commodity within the meaning of the Explanation to Article 286." These observations of the Supreme Court do not much assist us in determining the meaning of the expression "who processes any goods" appearing in section 5(1)(b)(ii) of the Sales Tax Act, 1953. Another decision on which reliance w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It cannot be said in the present case that when parts of a motor-car are removed so that they may be sold as spare parts, goods have been subjected to a treatment or process. The act of dismantling some parts of a motor-car cannot be treated as the processing of any goods within the meaning of the said section. In the result, our answer to the first question is in the negative. That brings us to the second question whether it could be said that any goods are produced or manufactured when some parts from a car are taken out therefrom. The learned Advocate-General very fairly has not urged before us that any goods are manufactured when parts are taken out from a car. He has confined his case to the question of production of goods when parts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se to which reference has been made is the one reported in VI Sales Tax Cases, page 30 (State of Madhya Pradesh v. Wasudeo). In that case a person was convicted under section 24(1)(a) of the C.P. and Berar Sales Tax Act, 1947, for dealing in timber cut from Government forests without holding a registration certificate. It was urged that he only cut the trees and made them in a transportable form and that he could not be said to be a dealer, who manufactured or produced goods within the meaning of section 2(1)(a) of that Act. It was found that he had made the cut trees into logs or rafters and sold them as such. After referring to the dictionary meaning of the word "manufacture" as "the making of articles or material by physical labour or me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions do not very much help us in considering the case which is before us. We have to read the provisions of the section as a whole and having so read them consider whether in plain English language one can ever say that a person who removed a part from a car for use as a spare part could be said to have produced that part. In our view it would be straining the language used in the section if we were to say that the respondents in this case produced any goods when they removed them from a car. In the result our answer to question No. 2 is in the negative. The answer to question No. 3 is purely dependent upon our answer to earlier questions Nos. 1 and 2. Our answer to question No. 3 is that the respondents are not liable to pay tax under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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