Broad definition of manufacture covers assembling auto rickshaw components into a distinct commercial commodity, triggering purchase tax liability.

Under the U.P. Sales Tax Act, the definition of "manufacture" was interpreted broadly to cover not only production of a new commodity but also altering, finishing, processing or adapting goods. On that basis, mounting the body of an auto rickshaw on its chassis was treated as manufacture because the assembled vehicle became a different commercial commodity in ordinary trade. The exemption condition requiring resale in the same form and condition was not met, and the fact that the parts could later be separated was held irrelevant. The assessee was therefore liable to purchase tax under the relevant exemption scheme.

---

---

Issues: Whether mounting the body of an auto rickshaw on its chassis amounts to manufacture under section 2(e-1) of the U.P. Sales Tax Act, 1948, and whether the resultant sale is in the same form and condition so as to avoid purchase tax under section 3-AAAA of the Act.

Analysis: The expression "manufacture" in section 2(e-1) was held to be of wide amplitude and to include not only the production of a new commodity but also altering, finishing, processing or adapting goods. The condition in form III-A under rule 12-A required resale in the same form and condition, and that requirement was not satisfied when the chassis and body were joined to sell an assembled auto rickshaw. The assembled vehicle was treated as a different commercial commodity in ordinary commercial parlance, and the reasoning that the parts could be separated again was held to be irrelevant. The wider definition of manufacture under the U.P. Act was distinguished from narrower statutory definitions considered in other cases.

Conclusion: Mounting the body on the chassis amounted to manufacture and the assessee was liable to purchase tax under section 3-AAAA. The appeal failed.

Ratio Decidendi: Where the statutory definition of manufacture is wide enough to include processing or adapting goods, assembling components into a commercially distinct end-product and selling it otherwise than in the same form and condition attracts purchase tax under the relevant exemption scheme.

---