Form IV benefit for transformer repair works upheld where manufacturing definition included repairing and clarification was not prospective

The inclusive statutory definition of "manufacture" under the Orissa Sales Tax Act was wide enough to cover repairing, so purchases used in repairing or processing transformers could qualify for declaration Form IV. The departmental notification relied on was treated as merely clarificatory, not prospective, and the assessee's earlier position in its own case supported use of Form IV for such works contract activity. On that basis, denial of the Form IV benefit was not sustainable, and the claim was accepted in favour of the assessee.

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Issues: Whether the assessee was entitled to purchase goods for use in repairing or processing transformers against declaration Form IV.

Analysis: The definition of "manufacture" in the Orissa Sales Tax Act was wide enough to include repairing. The earlier view in the assessee's own case treated the use of Form IV in works contract involving repair of transformers as valid, and the departmental notification relied upon was held to be merely clarificatory, not prospective. In such circumstances, the rejection of the assessee's claim could not be sustained.

Conclusion: The issue was answered in favour of the assessee and against the Department.

Ratio Decidendi: Where the statutory definition of manufacture is inclusive and covers repairing, and the relevant departmental clarification is merely clarificatory, Form IV benefit cannot be denied for purchases used in such works contract.

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