Commercial identity test for purchase tax applies when slaughtering animals into meat creates a distinct commodity.

Slaughtering goats and sheep and converting them into meat was treated as consumption of the original goods in the manufacture of other goods for sale under section 5A(1)(a) of the Kerala General Sales Tax Act, 1963. The decisive test was whether the original commodity and the processed product remained commercially the same; the Court noted that live goats and sheep are not the same commodity as meat in common parlance or commercial circles. The earlier view that the processed product remained the same commodity was rejected, and purchase tax was attracted.

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Issues: Whether slaughter of goats and sheep into meat amounts to consumption of goods in the manufacture of other goods so as to attract purchase tax under section 5A(1)(a) of the Kerala General Sales Tax Act, 1963.

Analysis: The statutory levy under section 5A(1)(a) is attracted where purchased goods are consumed in the manufacture of other goods for sale. The decisive inquiry is whether the original commodity and the processed product are commercially the same or whether the processing brings into existence a distinct commodity. Goats and sheep, on the one hand, and meat obtained after slaughter, on the other, are not treated as the same in common parlance or in commercial circles. Slaughtering the animals and converting them into meat involves consumption of the original goods and results in a different commercial article. The reasoning that the processed product remains the same commodity was rejected.

Conclusion: Slaughter of goats and sheep into meat constitutes consumption in the manufacture of other goods and attracts purchase tax under section 5A(1)(a) of the Kerala General Sales Tax Act, 1963; the finding in favour of the assessee was set aside.

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