Mineral classification and manufacture test: mere powdering does not create a new taxable commercial commodity.

Minerals such as emery powder, dolomite powder, silica sand, soap-stone powder and alumina did not cease to be minerals merely because they were crushed or powdered. The decisive test for sales tax classification was whether processing brought into existence a new commercial commodity. Mere powdering or other processing, even if treated as manufacture in statutory language, was insufficient unless the goods acquired a distinct commercial identity. The powdered products therefore remained within the entry for minerals of all kinds and could not be treated as unclassified goods.

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Issues: Whether minerals such as emery-powder, dolomite powder, silica sand, soap-stone powder and alumina cease to be minerals after powdering and become taxable as unclassified items; and whether such powdering amounts to manufacture so as to bring into existence a new commercial commodity.

Analysis: The entry "minerals of all kinds" was held to be wide in scope, but it covered minerals as such and not every change in their form. The fact that the goods were crushed or powdered did not, by itself, destroy their identity as minerals. For sales tax purposes, the decisive test was whether a new commercial commodity had emerged. Although the statutory definition of manufacture included processing, mere processing could not alter the basic requirement that there must be a different or new commodity for taxability. The items in question remained minerals in substance and commercial identity, and no new commodity came into existence merely because they were reduced to powder.

Conclusion: The powdered articles continued to fall within the notification entry as minerals, and they were not liable to be treated as unclassified goods on the footing that a new commercial commodity had been manufactured.

Final Conclusion: The assessee succeeded, the Commissioner's order was set aside, and the levy treating the goods as unclassified could not stand.

Ratio Decidendi: Mere powdering or processing of minerals does not take them outside an entry covering minerals of all kinds unless the process produces a distinct commercial commodity.

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