TMI Blog2001 (3) TMI 981X X X X Extracts X X X X X X X X Extracts X X X X ..... application given to the decision will automatically follow. 2.. The petitioners' learned counsel submitted that in the milling process bran is a by-product. He demonstrated to us from samples which were produced that this wheat bran either emerges in the form of fine powder in which case it is called bran or, in a rougher form in small pieces when it is categorised by the traders as wheat flakes. The essential point that was emphasised by the learned counsel was that the distinction made by the department is wholly unwarranted and artificial because there is no dispute about the common user of these two products in so far as they are both marketed and used exclusively as cattle feed. We need to mention here that the learned Government Advocate was quick to point out that as far as the factual position goes, and he substantiated this by producing the relevant material from the record, that the petitioners themselves list the two items separately and not under a common head for billing purposes. Also, what the learned Government Advocate demonstrated, which is undisputed, is that the prices for the two items are slightly dissimilar. It is on this basis that, whereas the petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... court pointed out that it is essential for the deciding authority to find out as to how precisely the item is identified by the specialist class of people in the trade and the dealers because this is really the barometer for purposes of ascertaining whether the items in question are equitable or not. 3.. The learned counsel then placed very heavy reliance on a decision of the Supreme Court reported in [1978] 41 STC 394 (Alladi Venkateswarlu v. Government of Andhra Pradesh). This decision is of considerable importance because this was a case in which a distinction was made between rice and two products which conformed to the description of puffed rice. After carefully considering the items in question, the Supreme Court held that they are all exempt because they must be regarded as one and the same or in other words as different items of rice. While the court considered the aspect that both parched and puffed rice are edible, the important principle that was laid down was that even though they had undergone a process of heating and parching without any ingredients or appreciable changes in chemical composition since there were no separate entries covering each of these items that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and even though they alter their overall complexion and consistency retain their basic identities and can therefore not be categorised separately. Relying on this principle, learned counsel submitted that bran is at the highest a powdered form of flakes or rather that flakes are an unpondered form of barn and that no distinction can be made between the two. In order to further reinforce his submission, our attention was invited to another decision of the Supreme Court reported in Commissioner of Sales Tax U.P. v. Lal Kunwa Stone Crusher (P.) Ltd. [2000] 118 STC 287; (2000) 3 SCC 525 wherein the Supreme Court had occasion to point out that in the case of stone and crushed stone, the Legislature has made a conscious distinction between the two products even though the genesis of the item is the same and that consequently, where for certain valid reasons differing rates of tax are required to be applied that it would be necessary to categorise the items separately. The learned counsel for the petitioners laid heavy emphasis on the fact that if there was any intention on the part of the Legislature to categorise wheat flake as a separate product and tax it separately, that then it wou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder the Excise Act laid down an important principle which has been relied on in the present case. The Supreme Court was dealing with items of sea food such as prawns and shrimps. The department had contended that these products in their raw or virgin form do not bear any resemblance either descriptionwise or pricewise to the processed products. The court took cognizance of the fact that commercially these are regarded as the same commodity but the most important principle laid down by the Supreme Court on the basis of several foreign decisions was that the products retained their original character and identity and regardless of the process of transformation that no distinction is tenable. The learned counsel submitted before us that even in a case of this type where the difference in the product was very much appreciable that the court ultimately examined the question of basic characteristics and identity for purposes of the process of equation. 5.. On the basis of these principles the short submission canvassed was that even without entering into any elaborate analysis because the two items namely wheat bran and wheat flakes are so close to each other and so similar and have n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ler Flour Mills case wherein admittedly, the Supreme Court held that while dealing with wheat flour, maida and suji derived from wheat are not wheat within the meaning of item (iii) of section 14(i) of the Central Sales Tax Act, 1956 and they are different and distinct goods from wheat. The Supreme Court held that even though wheat is consumed for producing these items, the commodities obtained are different commodities from wheat, that wheat loses its identity but gets consumed and in its place new goods/commodities emerge. New goods so emerging have a higher utility than the commodity consumed, they are different goods commercially speaking. It is on the basis of these principles that the learned Government Advocate submitted that the department was fully and completely justified in having refused to equate wheat bran with flakes and the learned Government Advocate submitted that it is this decision which would cover the fate of the present case. He also submitted that the Supreme Court had occasion to consider the earlier decision reported in Alladi Venkateswarlu v. Government of Andhra Pradesh [1978] 41 STC 394 and to hold that the principles which apply to that case where the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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