Broad construction of "product" under sales tax deferral scheme extends incentive coverage to saleable manufacturing by-products.

Under an industrial incentive scheme granting sales tax deferral, the word "product" was construed broadly because it was not confined to the principal manufactured item. A by-product emerging from the manufacturing process and capable of separate commercial sale was treated as falling within that expression, since a purposive reading of the scheme was required to advance its object of promoting industrial activity in backward areas. On that basis, steel scrap generated during manufacture was covered by "product" and could be considered for deferral benefit.

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Issues: Whether steel scrap generated as a by-product during manufacture could be treated as a "product" for the purpose of availing sales tax deferral benefits under the industrial incentive scheme.

Analysis: The expression "product" in the deferral scheme was not defined so as to confine it only to the principal manufactured item. The scheme was intended to promote industrial activity in backward areas by postponing tax liability, and its object required a construction that advanced the benefit rather than defeated it. A by-product which emerges from the manufacturing process and is a distinct commercial commodity capable of separate sale falls within the scope of "product" for the scheme. The cited precedent on cotton waste and the Supreme Court decision on coal ash supported inclusion of by-products within similar incentive schemes.

Conclusion: The steel scrap by-product was held to be covered by the word "product" and therefore eligible to be considered for the deferral benefit.

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