Manufacture and processing require a new, distinct commodity; filling bulk LPG into cylinders is only repacking, not eligible for concessional tax treatment.

Filling LPG from bulk storage into smaller cylinders for sale does not amount to manufacture or processing because the commodity retains the same identity, character and use; mere transfer, repacking or division into smaller lots is insufficient even if machinery is used. The court held that a commercial transformation into a new and distinct article is required before manufacture can be found, and that a special definition in gas safety legislation cannot control the meaning of manufacture or processing under sales tax law. The activity therefore did not qualify for concessional tax treatment.

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Issues: Whether filling LPG from bulk containers into smaller cylinders for sale amounts to manufacture or processing of goods so as to qualify for concessional tax treatment under the notified entry.

Analysis: Manufacture requires that the original commodity undergo a transformation resulting in a new and distinct article having a different name, character or use. Processing requires some change in the commodity, though not necessarily a complete transformation. Mere division of a commodity into smaller lots, repacking or transfer from one container to another does not amount to processing if the identity of the commodity remains unchanged. Filling LPG from bulk storage into cylinders does not alter the nature of LPG; the use of machinery for the transfer is immaterial when no change is brought about in the commodity. A special definition contained in safety legislation governing explosives and gas cylinders cannot control the meaning of manufacture or processing in sales tax law.

Conclusion: Filling bulk LPG into smaller cylinders for sale is neither manufacture nor processing of goods. The appellant was not entitled to the concessional rate of tax.

Ratio Decidendi: A commodity is manufactured only when processing brings about a commercially distinct article, and mere repacking or transfer into smaller containers without change in identity does not amount to manufacture or processing.

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