TaxTMI 
TaxTMI 
2007 (11) TMI 394
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....----------------------------------- The judgment of the court was delivered by V.S. SIRPURKAR J.-The judgment of the High Court denying the exemption from payment of sales tax is under challenge in this appeal at the instance of the appellant, Pondicherry State Cooperative Consumer Federation Ltd. (for short, "the assessee"). Such exemption was granted by the Sales Tax Appellate Tribunal at Pondicherry by allowing an appeal filed by the assessee. Prior to that the assessee was assessed by the assessing authority and on an appeal by the assessee the taxable liability was brought down to Rs. 14,26,729.86 by the Appellate Commissioner. An appeal was, thereafter, filed before the Tribunal which allowed the appeal holding tha....
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.... of Industries, Pondicherry. There is no difficulty and it is an accepted position that the appellant-assessee is covered by this Government Order. The Department, however, took the view that purchase of palmolive oil and then re-packing the same could not amount to manufacture of goods and as such the said G. O. could not be made applicable to the assessee's case. It is in that view that the assessment orders were passed. The Tribunal took the view that though in the strict legal sense the assessee's activities could not be viewed as "manufacturing" yet since the Director of Industries had exempted the assessee from payment of sales tax it had to be accepted as a valid legal document founded on the authority of the Finance Depart....
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....ale industry. There also it was found on inspection that the assessee industry was allowed irregular tax exemption on the first sales of anhydrous liquefied ammonia as it was found that the commodity that was purchased and sold was one of the same and there was no new commodity that had emerged and that the assessee had only done bottling of ammonia. The show cause notices were issued to the assessee in that case suggesting therein that the activity of bottling/packing of gases into unit containers from bulk quantities was not recognised as "manufacture" even under the Central Excise Act. In that view the question which fell for consideration before this court was as to whether under the circumstances the assessee could claim the exemption.....
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....how cause notices came to be served on the assessee. The G.O. providing exemption clearly suggested that such exemption was given in the public interest. Therefore, it is obvious that the decision in Vadilal Chemicals' case [2005] 6 SCC 292(1) would be equally applicable as even in that case what the industry did was to bottle the ammonia gas purchased in bulk. In the present case it is palmolive oil which is purchased in bulk and is re-packed so as to facilitate its sale in the retail market. Shri T.L.V. Iyer, Senior Advocate appearing on behalf of the Union Territory of Pondicherry, however, tried to suggest that the exemption from payment of tax granted on May 19, 1989 was granted by the Director of Industries and it was clear from th....
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....particular industry, the State cannot be allowed to run around and take a stance that the appellant-assessee was not entitled to the exemption on the ground that it did not manufacture any goods. We are in respectful agreement with the view taken in Vadilal Chemicals' case [2005] 6 SCC 292(1) which is more particularly reflected in paras 19 and 20 of that decision where this court observed as under: "In this case the State Sales Tax Act contains no provision relating to 'manufacture'. The concept only finds place in the 1993 G.O. issued by the Department of Commerce and Industries. It appears from the context of the other provisions of the 1993 G. O. that the word 'manufacture' had been used to exclude dealers who merely purchased the go....