Raw material in mining excludes incidental supplies, but drilling bits qualify when consumed in the extraction process.

Under section 2(l) of the Madhya Pradesh General Sales Tax Act, only goods actually used as an ingredient, consumed in the process of manufacture, or falling within fuel and lubricants qualify as raw material for section 8 relief. Timber, kerosene oil, hewing implements, dry cells, torches, cement, lime and electrical bulbs used in coal mining were treated as supporting or incidental items, so they did not qualify. Drilling bits, however, were consumed in boring holes for blasting and their utility was quickly exhausted in the mining process, so they were treated as raw material. Relief was therefore available only in respect of drilling bits.

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Issues: (i) Whether timber, kerosene oil, drilling bits, hewing implements, dry cells, torches, cement, lime and electrical bulbs used in coal mining qualified as raw material within section 2(l) of the Madhya Pradesh General Sales Tax Act, 1958 for the purpose of section 8 relief; (ii) whether drilling bits alone could be treated as raw material as an article consumed in the process of manufacture.

Issue (i): Whether timber, kerosene oil, drilling bits, hewing implements, dry cells, torches, cement, lime and electrical bulbs used in coal mining qualified as raw material within section 2(l) of the Madhya Pradesh General Sales Tax Act, 1958 for the purpose of section 8 relief.

Analysis: The definition of raw material covers only an article used as an ingredient in manufactured goods, an article consumed in the process of manufacture, and fuel and lubricants required for that process. The items other than drilling bits were found to be used for supporting, illuminating, repairing, or incidental purposes in the mine, and not consumed in the process of manufacture or mining so as to form an integral part of that process.

Conclusion: These items did not qualify as raw material and the assessee was not entitled to relief in respect of them.

Issue (ii): Whether drilling bits alone could be treated as raw material as an article consumed in the process of manufacture.

Analysis: Drilling bits were used to bore holes in the mine walls, the holes were filled with explosives, and the detonation produced coal. Their utility was quickly exhausted, showing that they were consumed in the mining process and within the statutory definition of raw material.

Conclusion: Drilling bits qualified as raw material and the assessee succeeded to that limited extent.

Final Conclusion: The appeal succeeded only in part, with recognition of drilling bits as raw material, while the claim for the remaining items failed.

Ratio Decidendi: Under a definition that requires consumption in the process of manufacture, only goods that are actually consumed and integral to that process qualify as raw material; items used merely incidentally or as supporting or auxiliary materials do not.

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