LPG bottling into smaller cylinders was not manufacture, so the sales tax exemption claim failed.

Bottling LPG from bulk storage into smaller cylinders was held not to constitute manufacture under clause 11(ix) of SRO No. 1729/1993, because the process involved transfer, purging, decanting and packaging of the same commodity without any chemical change or emergence of a commercially distinct product. The Court treated the exclusion of mere packing as significant and found that LPG remained LPG throughout the process. As a result, the activity did not satisfy the statutory definition of manufacture and the sales tax exemption claim failed.

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Issues: Whether bottling of LPG into smaller cylinders amounted to "manufacture" within the meaning of clause 11(ix) of SRO No. 1729/1993 so as to qualify for sales tax exemption.

Analysis: The definition of manufacture required the use of raw materials, production, and emergence of a commercially different product. The process undertaken by the petitioner consisted of receiving LPG in bulk, storing it, and filling it into smaller cylinders after purging oxygen and decanting nitrogen under controlled conditions. The Court held that these steps facilitated transfer and packaging of the same commodity and did not result in any chemical change or commercially distinct article. The Court also noted that the notification excluded mere packing from the scope of manufacture and that LPG remained LPG throughout the process.

Conclusion: Bottling of LPG into smaller cylinders did not amount to manufacture and the exemption claim failed.

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