TMI Blog2015 (5) TMI 293X X X X Extracts X X X X X X X X Extracts X X X X ..... 4) of the Act and, therefore, as such, no error has been committed by the learned Tribunal in holding that the process undertaken by the dealer to convert the NSS to HS can be said to be the process of ‘manufacture’ within the meaning of Section 2(14) of the Act and consequently, the dealer would be entitled to the input tax credit. As observed hereinabove, as such, by the process undertaken by the dealer, seeds which was initially not marketable and eatable, would become eatable and marketable and, therefore, there will be change in the form. - no reason to interfere with the impugned common judgment and order passed by the learned Tribunal - Decided against Revenue. - TAX APPEAL NO. 228, 229, 230, 231, 232, 233 of 2015, CIVIL APPLICATION (OJ) NO. 297, 298, 299, 300, 301, 302, of 2015 - - - Dated:- 16-4-2015 - MR. M.R. SHAH AND MR. S.H.VORA, JJ FOR THE APPELLANT : MS VACHA DESAI AGP JUDGMENT (PER : HONOURABLE MR.JUSTICE M.R. SHAH) 1. As common question of law and facts arises in this group of appeals and as such, the appeals arising out of the impugned common judgment and order passed by the learned Gujarat Value Added Tax Tribunal, Ahmedabad (hereinafter ref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ereby, the dealer would be entitled to the input tax credit or not? 4. The facts leading to the present appeals in nutshell are as under. For the sake of convenience, the facts in the case of dealer - M/s.Shyam Industries are considered which are as under:- 4.1. That, in all these cases but with respect to different assessment years, the Assessing Officer passed the reassessment order denying the input tax credit to the dealer by observing that the process undertaken by the dealer from converting NSS to HS cannot be said to be the process of manufacture and, therefore, the dealer is not entitled to the input tax credit on the purchases of fuel, machinery parts and packing material and other consumable material and the processing material, if any. The Assessing Officer also levid the penalty and charged interest on additional dues. 4.2. That, feeling aggrieved and dissatisfied with the reassessment orders passed by the Assessing Officer, the dealer preferred appeals before the first Appellate Authority. The first Appellate Authority dismissed some of the appeals on non-deposit of the amount of pre-deposit. However, the first Appellate Authority decided the appeals on mer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bench of this Court in the case of Laxmi Oil Mills Ltd. (supra). It is submitted that in the facts of the present case the learned Tribunal has materially erred in applying the decision of the Division Bench of this Court in the case of Laxmi Oil Mills Ltd. (supra). 5.3. It is submitted that even in the decision in the case of Laxmi Oil Mills Ltd. (supra), the Division Bench of this Court has observed that every process cannot be considered to be process of manufacture. It is submitted that as observed and held by the Division Bench of this Court in the said decision, the process varies from product to product and every process cannot be said to be process of manufacture within the meaning of Section 2(14) of the Gujarat Sales Tax Act (hereinafter referred to as GST Act ). 5.4. It is submitted that in the present case, the process undertaken by the dealer is cleaning, drying and brushing with chemicals and removing of upper layer only and, therefore, the said process cannot be said to be process of manufacture . It is submitted that only by use of chemical while cleaning, drying and brushing, there is no new product manufactured and the seeds would remain seeds. It is su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich is undertaken by the dealer while converting the NSS to HS is required to be considered. From the order passed by the Assessing Officer as well as the first Appellate Authority and even from the impugned common judgment and order passed by the learned Tribunal, it appears that while converting the NSS to HS, the dealer was required to undertake the process of cleaning, drying and brushing with chemicals and removing the upper layer of NSS. That after the purchase of NSS, the following process is being undertaken by the dealer to convert the NSS to HS:- (i) After purchase of the NSS the same are dropped in a machine where the NSS are cleaned and the NSS are mechanically cleaned wherein dust is cleaned form the surface of the NSS. (ii) Thereafter, grading of the NSS is done according to the requirement specified by the foreign buyer. The said grading depends upon the shape and size of the NSS. (iii) Thereafter, the NSS are washed with the help of caustic soda. After washing, the minor dust particles which possibly would have remained come on the surface of the NSS. (iv) The entire above process is done mechanically in and with the help of machines. (v) After washi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me Court in the case of Chowgule Co. Pvt. Ltd. V/s. Union of India reported in [1981] 47 STC 124 (SC) = AIR 1981 SC 1014 and the decision of the Hon ble Supreme Court in the case of Collector of Central Excise v. Rajasthan State Chemical Works reported in AIR 1991 SC 2222. After considering the above, it is observed that in determining what constitutes manufacture no hard and fast rule can be applied and each case must be determined on its own facts having regard to the context in which the term is used in the provision under consideration. It is further observed that (i) whenever a commodity undergoes a change as a result of some operation performed on it and in regard to it, such operation would amount to processing of the commodity; (ii) each step towards production would be a process in relation to the manufacture ; (iii) that the natural meaning of the word process is a mode of treatment of certain materials in order to produce a good result, a species of activity performed on the subject matter in order to transform or reduce it to a certain stage. It is further observed that what is necessary in order to characterise an operation as processing is that the commodity ..... X X X X Extracts X X X X X X X X Extracts X X X X
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