TMI Blog2010 (1) TMI 1263X X X X Extracts X X X X X X X X Extracts X X X X ..... sed directly to manufacture fabric. According to the expert, crimps, bulkiness etc. are introduced by a process, called as thermo mechanical process, into POY which converts POY into a texturized yarn. If one examines this thermo mechanical process in detail, it becomes clear that texturising and twisting of yarn constitutes 'manufacture' in the context of conversion of POY into texturized yarn. See M/s. Oracle Software India Ltd. [ 2010 (1) TMI 9 - SUPREME COURT] as held term manufacture implies a change, but, every change is not a manufacture, despite the fact that every change in an article is the result of a treatment of labour and manipulation. If an operation/process renders a commodity or article fit for use for which it i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment Year is 1996-97. Repeatedly this Court has recommended to the Department, be it under Excise Act, Customs Act or the Income Tax Act, to examine the process applicable to the product in question and not to go only by dictionary meanings. This recommendation is not being followed over the years. Even when the assessee gives an opinion on a given process, the Department does not submit any counter opinion wherever such counter opinion is possible. Prima facie, however, in this case, we do no see possibility of any counter opinion to the opinion given by the Mumbai University, vide letter dated 10th July, 1999. With the above preface, we are required to examine the above question as to whether twisting and texturising of POY amou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... commodity or article fit for use for which it is otherwise not fit, the operation/process fall6 s within the meaning of the word manufacture . Applying the above test to the facts of this case, it is clear that POY simplicitor is not fit for being used in the manufacture of a fabric. It becomes usable only after it undergoes the operation/process which is called as thermo mechanical process which converts POY into texturised yarn, which, in turn, is used for the manufacture of fabric. One more point needs to be mentioned. Under the Income Tax Act, as amended in 2009, the test given by this Court in M/s. Oracle Software's case (supra) has been recognised when the definition of the word 'manufacture' is made explicit by Financ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d above, means partially oriented yarn whereas a cellulosic filament yarn is a final product in the sense that it can be used directly for manufacture of fabric. If this definition is kept in mind, the judgment in the case of Swastik Rayon Processors's case (supra) will not apply to the facts of the present case. We once again repeat the caution which we have mentioned hereinabove. Our judgment in the present case is to be confined to the facts of the present case. We are not saying that texturising or twisting per se in every matter amounts to manufacture. It is the thermo mechanical process embedded in twisting and texturising when applied to a partially oriented yarn which makes the process a manufacture. In the circumstances, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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