TMI Blog1962 (11) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... ference has been made at the instance of the applicants who are dealers in tobacco. No tax under the Act is payable on the sale of goods which are notified by the State Government in the Official Gazette. The State Government have issued a Notification No. S.T. 119-X-9281948, dated 7th June, 1948, notifying the goods which are exempt from the payment of sales tax, and item No. 9 of the notification is: "Tobacco leaves, whether green or dried, not having been subjected to any process of manufacture." The applicants deal in "crushed and sieved" tobacco. Crushing and sieving consists of crushing dried tobacco leaves and passing the crushed tobacco through a sieve. The applicants claim that crushed and sieved tobacco is covered by item No. 9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uniform size and weight: see rule 223 of the Central Excise Manual. The applicants contend that tobacco leaves are crushed and sieved in order that their storage is in conformity with the above rule. It is not possible to store tobacco leaves as such; they must be crushed and separated from dust through sieving. Because crushing and sieving is done in order to comply with the rule regarding storage, it is contended on their behalf, that it does not amount to subjecting the tobacco leaves to a manufacturing process. It was also contended that crushing and sieving tobacco leaves does not amount to manufacturing within the meaning of the Act, because crushing and sieving is not incidental or ancillary to the completion of a manufactured produ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s sweet as sugar) to a chemical process, the result of which was that in some cases "550 saccharin" and in some a mixture sweeter than 330, but not as sweet as 550 saccharin, and in a few cases a mixture less sweet than 330 saccharin were produced, and it was answered in the negative. What was stressed by Bray and Darling, JJ., was that it was saccharin before, and it was saccharin after, the so-called manufacturing process. The article began by being saccharin and remained saccharin; it was not converted into something else and, therefore, it was held that the process was not one of manufacturing. Darling, J., observed at page 361: "I think the essence of making or of manufacturing is that what is made shall be a different thing from tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er manufactures a box out of wood and a tailor manufactures a suit out of cloth; even though gold remains gold, leather remains leather, wood remains wood and cloth remains cloth, when the ornaments, the boots, the box and the suit are prepared, there is manufacturing, because the articles brought into existence are commercially different commodities. Cutting trees into logs or rafters which were sold as such was held to be manufacturing in State of Madhya Pradesh v. Wasudeo[1955] 6 S.T.C. 30.The reason given by Bhutt, J., was that the logs or rafters had a definite commercial value. He adopted the Century Dictionary meaning of the word "manufacture", e.g., "the production of articles for use from raw or prepared materials, by giving these ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 S.T.C. 294. Hidayatullah, C.J., and Chaturvedi, J., held that boulders themselves are a marketable commodity and if they had been sold as such it would not have been a sale of manufactured goods, but gitti is a different marketable commodity and the conversion of boulders into gitti amounted to manufacturing. The learned Judges observed at page 296: "The essence of manufacture is the changing of one object into another for the purposes of making it marketable," and that "when the boulders are broken into metal or gitti there is some process, manual though it may be, for the purpose of shaping the stones into another marketable commodity." The meaning that Narasimham, C.J., and Das, J., would give to the word "manufacture" in a Sales Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... slates. In order that the process to which an article is subjected should be a manufacturing process it is not essential that the article must change its nature; it is enough if it becomes a different commercial article. The question whether crushed and sieved tobacco is a commercially different article is a question essentially of fact and has been answered in the affirmative by the Judge (Revisions). In view of his finding that it is commercially a different article. I must hold that crushing and sieving is a manufacturing process. Only tobacco leaves not subjected to any process of manufacture are exempted under the notification issued by the State Government and Kampila dana, Dana or Chhora is an article commercially different from tob ..... X X X X Extracts X X X X X X X X Extracts X X X X
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