Manufacture of garam masala falls within sales tax law when mixing creates a commercially distinct product beyond mere grinding.

Preparation of garam masala was held to amount to manufacture under section 2(j) of the M.P. General Sales Tax Act, 1958 because the process involved mixing different condiments in definite proportions and produced a commercially distinct product. The statutory exclusion in Rule 2-A, which covers mere grinding of chillies, turmeric, dhania and similar condiments, did not apply because the activity went beyond grinding and created a new product from the ingredients used. The principle applied is that a process is manufacture when it brings into existence goods different from the inputs and is not within the specific rule-based exclusion.

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Issues: Whether the preparation of garam masala amounts to manufacture within the meaning of section 2(j) of the M.P. General Sales Tax Act, 1958, having regard to the exclusion in Rule 2-A of the Rules framed under the Act.

Analysis: Manufacture under section 2(j) extends to any process of producing, preparing or making goods, subject to prescribed exclusions. The exclusion in Rule 2-A covers grinding of chillies, turmeric, dhania and other condiments, but the preparation of garam masala was found to involve more than mere grinding. Garam masala is produced by mixing different condiments in definite proportions, and that mixing brings into existence a product different from the ingredients used. The process therefore goes beyond the limited exclusion created by the rule.

Conclusion: The preparation of garam masala amounts to manufacture under section 2(j) and is not excluded by Rule 2-A. The question was answered in the affirmative and against the assessee.

Ratio Decidendi: A process constitutes manufacture where it brings into existence a commercially different product and is not covered by the specific statutory exclusion applicable to mere grinding of condiments.

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