9911796707
TMI Blog2009 (1) TMI 831X X X X Extracts X X X X X X X X Extracts X X X X ..... ely, the General Manager, District Industries Centre, Palakkad, rejected the application. The petitioner preferred an appeal to the second respondent, State Level Committee for exemption of sales tax. The appeal was allowed and the matter was remitted back to the fifth respondent. The fifth respondent again rejected the application. Thereafter, the petitioner preferred exhibit P1 appeal which has been rejected by exhibit P10 by the second respondent. The petitioner is a company incorporated under the Companies Act, 1956, for the purpose of establishing, operating LPG bottling plants and sale of LPG cylinders and other functions. It is the case of the petitioner that hearing of exhibit P1 appeal was scheduled on March 6, 2006 and the petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'manufacture' for the purpose of this notification:- (a) Crushing copra and producing coconut oil and coconut oil cake. (b) Converting timber logs into timber sizes. (c) Crushing rubble into small metal pieces. (d) Converting sodium silicate into liquid silicate. (e) Tyre-retreading. (f) Cutting granite or marble slabs into smaller pieces and/or polishing them. (g) Such other processes as may be notified by Government in this behalf." The process "manufacture" has been detailed in the appeal memorandum. Paragraphs 6 and 7 would appear to be devoted to the process involved and it is extracted as hereunder: "6. Without prejudice to the above submissions, it is submitted that the process of bottling LPG is not mere packing. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deemed as packing of LPG under the KGST Act. Entry 91 of the First Schedule to the KGST Act and SRO No. 405 of 1994 which gives details of various packing materials for commodities does not include the steel cylinder for LPG in the said list. LPG is listed under item 97(vi) of the First Schedule. As no packing is specified in LPG under item 97(vi) or item 91 of the First Schedule, it can only be presumed that LPG under the First Schedule is the commercial product LPG and not the bulk LPG. Bulk LPG has to be processed and bottled to make it suitable for domestic and commercial use. Hence by no means is a product substantially different from LPG obtained in the process of refining of petroleum. It has been held by the honourable Supreme Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... word "manufacture" in the notification. On a perusal of the definition, there are three crucial elements involved in "manufacture" as defined. In the first place, there must be raw materials. Secondly, there must be production and lastly, what is produced must be a commercially different product. Applying these three tests to the process undertaken in the petitioner's factory, I am of the firm view that it cannot be said that there is any manufacture involved. It is not in dispute that what was LPG continues to be LPG. In other words, the product which was present in bulk form is put into smaller form and thereafter it is sold to the end consumer. In this process, what is involved is stated by the petitioner itself in its appeal memora ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Sales Tax (Law), Board of Revenue (Taxes), Ernakulam v. Coco Fibres [1991] 80 STC 249 (SC); [1992] Supp. 1 SCC 290. Therein, the apex court was considering whether making of coconut fibre from husk involves any manufacturing process. The court proceeded to hold as follows: "In view of the admitted position that green husk is soaked into saltish sea water for days together and after decomposition, on being subjected to beating either by manual or mechanical process, fibre is produced in the process, which is a distinct commodity known in the commercial parlance. No one in the market would sell or supply husk when fibre is asked for. Accordingly, it must be held that the coconut fibre is commercially a different identifiable commodity know ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
