Manufacture by processing: coal dust turned into distinct coal briquettes and remained taxable under trade tax law.

Coal dust converted into coal briquettes by crushing, mixing with binders and pressing was held to amount to manufacture under the U.P. Trade Tax Act because the statutory definition of manufacture includes processing, treating or adapting goods. The briquettes were treated as a different commercial commodity from coal dust, with changed shape, form, moisture and characteristics, and that factual finding was not open to interference. The claim to protection as declared goods under the Central Sales Tax Act failed because the sold commodity was not regarded as the same goods for exemption or single-stage taxation. The tax demand was therefore sustainable.

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Issues: Whether coal briquettes made from coal dust are a different commercial commodity and amount to manufacture under the U.P. Trade Tax Act, and whether they remain protected as declared goods under the Central Sales Tax Act.

Analysis: The definition of manufacture in section 2(e-1) of the U.P. Trade Tax Act is wide and includes processing, treating or adapting goods. Applying that definition, the conversion of coal dust into coal briquettes by crushing, mixing with binders and pressing is processing and adaptation of the raw material. The resulting briquettes are distinct from coal dust in shape, form, moisture and characteristics, and the Tribunal's finding that they are commercially different commodities was not open to interference. The argument based on declared goods failed because the commodity sold after the process was not treated as the same commodity for the purpose of exemption or single-stage taxation.

Conclusion: Coal briquettes are manufactured goods and a different commercial commodity from coal dust. The tax demand was therefore sustainable and the appeals failed.

Final Conclusion: The decision affirms taxability of coal briquettes under the State trade tax regime on the basis that the processing of coal dust results in manufacture of a distinct commodity.

Ratio Decidendi: Under a definition of manufacture that expressly includes processing, treating or adapting goods, a commodity produced from raw material through such processes is taxable even if the process does not always result in a wholly new commercial article.

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