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TMI Blog2023 (3) TMI 943X X X X Extracts X X X X X X X X Extracts X X X X ..... . 1. The question which is urged in all these appeals is the correctness of the view of the High Court that the process which the product in the present case underwent - i.e., mixture of the base paint with different colours - did not result in a 'new' product, and therefore did not result from the process of 'manufacture' as defined under Section 2(e)(i) of the U.P. Trade Tax Act, 1948 ("Act"). 2. The facts in all these cases are that the assessees are dealers in inter alia paints. The Revenue contended that the sale of paints which had undergone mixing (through a computerised process with the aid of a DTS machine) amounted to 'manufacture', thereby resulting in a new product, which was a fresh incidence of taxation. The assessee on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed before it. 5. The Revenue urged that the findings in the impugned order are erroneous, and relied upon Sonebhadra Fuels (supra) to argue that the High Court was bound by this Court's decision since it was directly on an interpretation of the expression 'manufacture' in the same enactment. In Sonebhadra Fuels, the court had considered whether coal briquettes fell with the generic description of 'coal'. This court held that the process involved mixing crushed coal with suitable binders pressed in briquetting press, from which regular shaped briquettes were suitably carbonised. This process was held to amount to 'manufacture'. 6. The definition of 'manufacture' under the Act is as follows: - "2 (e-1). 'manufacture' means producing, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... means production of articles for use from raw or prepared materials by giving them forms, qualities or combination. Importantly however, it was held that if the change made in the article resulted in a 'new' and 'different' article, it would amount to 'manufacturing'. The tipping point, or the determinative test, therefore is that the result of the process (amounting to 'manufacture') must be the emergence of a commercially recognizable new commodity, and not mere variation of an existing one. 9. In the present case, the findings based on the expert's evidence are that the base paint was mixed with colouring as an additive. Both of these had suffered tax. The resultant article i.e., the paint of a different shade, did not result in a new ..... X X X X Extracts X X X X X X X X Extracts X X X X
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