TMI Blog1991 (10) TMI 304X X X X Extracts X X X X X X X X Extracts X X X X ..... ms which has assumed considerable importance and urgency in recent years as a result of increasing industrialisation and urbanisation. The Act is intended to ensure that the domestic and industrial affluence are not allowed to be discharged into water coarses without adequate treatment. This Act is now in force in almost all States and in all Union Territories. The Act provides for the constitution of a Central Board by the Central Government and State Boards by the State Governments concerned for the prevention and control of water pollution. There are also certain provisions relating to constitution of joint boards the details of which need not detain us. The Act sets out in detail the functions and powers of these Boards. Chapter VI of the Act requires the Central Government and the State Governments to provide funds to the Central Board and the State Boards respectively for implementing the provisions of the Act. The Cess Act 36 of 1977 provides for levy of cess on water consumed by persons carrying on certain industries and by the local authorities with a view to augment the resources of the Central Board and the State Boards constituted for the prevention and control of water ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 277 of 1984 to be dealt with along with this group of cases. The object of the Act is to control the water pollution and to ensure that industrial affluents are not allowed to be discharged into the water coarses without adequate treatment. The Cess Act is not an enactment to regulate and control pollution but a fiscal measure to raise revenue for augmenting the resources of the Pollution Control Boards. The levy and collection of cess provided under the Cess Act is on water consumed by persons carrying on the industries specified in the Schedule. The Cess is levied on the person carrying on the specified industry. The question is whether industries manufacturing sugar is covered by Entry 15 that is processing of vegetable product industry . From the botanic point of view vegetable may include any plant but in common parlance it is understood as referring to edible plants or parts of edible plants. The word vegetable has been defined in many ways. In the World Book it is defined as follows: In the usual sense, the word vegetable is applied to those plants whose leaves, stalks, roots or tubers are used for food, such as lettuce, asparagus, cabbage, beet and turni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. The question for consideration was whether manufacturing of rayon grade pulp a base material for manufacturing of synthetics or manmade fabrics is an industry as mentioned in Schedule I to the Cess Act. It was held: Whether a particular industry is an industry as covered in Schedule I of the Act, it has to be judged normally by what that industry produces mainly. Every industry carries out multifarious activities to reach its goal through various multifarious methods. Whether a particular industry falls within the realm of taxation, must be judged by the predominant purpose and process and not by any ancillary or incidental process carried on by a particular industry in running its business. This Court also observed: It has to be borne in mind that this Act with which we are concerned is an Act imposing liability for cess. The Act is fiscal in nature. The Act must, therefore, be strictly construed in order to find out whether a liability is fastened on a particular industry. The subject is not to be taxed without clear words for that purpose, and also that every Act of Parliament must be read according to its natural construction of words. See the observations In Re. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng retain its character as vegetable. Processing: Section 3(1), Marine Product Export Development Authority Act, 1972 defines processing in relation to marine products, as including the preservation of such products as canning, freezing, drying, salting, smoking, peeling or filleting or any other method of processing which the authority made by notification in the Gazette of India, specified in this behalf. Section 2(g) of the Agricultural and Processed Food Products Export Development Authority Act, 1985 defines processing in relation to scheduled products as including the process of preservation of such products such as canning, freezing, drying, salting, smoking, peeling or rilleting and any other methods of processing which the authority made by notification in the official Gazette specified in this behalf. Thus processing as generally understood in marine, agricultural and food products industries is an action, operation or method of treatment applying it to something. It is refining, development, preparation or converting of material especially that in a raw state into marketable form. It would be interesting to note that this Act contains a Schedule of the agricultural or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from that originally existed in the sense that the thing produced is by itself a commercially different commodity whereas in the case of processing it is not necessary to produce a commer- cially different article. Processing essentially effectuates a change in form, contour, physical appearance or chemical combination or otherwise by artificial or natural means and in its more complicated form involves progressive action in performing, producing or making something. Vide Com Products Refining 60. v. Federal Trade Commission, CCA. 7, 144 F.2d 211. In the decisions under appeal, the Allahabad High Court held that sugar mills will come within the meaning of processing vegetable products industry in Entry 15 on the ground that the word vegetable has been used in opposition to the expression animal and that it could not be given the meaning of vegetables which are kept on the dining tables for dinner purposes, and it has a wider amplitude. It was further of the view that in interpreting the word vegetable one has to keep in mind the object for which the Cess Act was made. The learned Judges then stated that sugar industry is one of the main source of causing water polluti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are not products of manufacture unless we say that agriculture is an industry for certain purposes and vegetables are products of that industry. In order to bring an industry within any of the entires in Schedule I it has to be seen what is the end product produced by that industry. Sugar cane is not a vegetable though it may be an agricultural product. If the botanic meaning of vegetable as referring to any and every kind of plant life is to be given then some of the industries listed in Schedule I like Paper Industry and Textile Industry and even chemical industry which are covered by other entries could also be brought within Entry 15. The word vegetable in the context does not attract the botanic meaning. The sugar manufacturing industry do not, therefore, come within Entry 15 of Schedule I of the Cess Act. In Civil Appeal (arising out of Special Leave Petition No. 814 of 1990) the appellant is Haryana Distillery who purchases molasses which is a by-product of the .manufacture of sugar and manufactures alcohol. Manufacture of alchohol was held by the High Court to come within Entry 15 of Schedule I as processing agricultural prOduct industry. We have held already that the i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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