1991 (6) TMI 230

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.... sold LAB to M/s. Paramount Chemical Industries, Baroda. On the basis of this sale, the opponent-assessee submitted an application dated February 16, 1979, under section 62(1)(e) of the Gujarat Sales Tax Act, 1969, to the Commissioner for determination of the rate of tax payable on such sale. The question arose under which of the following two entries, which were in force at the relevant time, the article LAB was falling. Entry 9 of Schedule II, Part A read as under: "9. Dyes and chemicals other than those specified in any other entry in this or any other Schedule." Entry 32 of Schedule II, Part A reads as follows: "32. Petroleum products, including light diesel oil but excluding lubricants, kerosene, solvent oil, furnace oil and a....

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....nue. Our reasons for this answer are as follows: 5.. It is an undisputed posit ion that the two components of LAB are kerosene and benzene. Both, kerosene and benzene are petroleum products. On this point there is no dispute. It is also not in dispute that when these two articles, namely, kerosene and benzene are mixed together in certain proportion, the product LAB comes into existence. It is also not in dispute that LAB does not contain any other ingredients other than kerosene and benzene. Therefore, simply because on account of the mixture of two petroleum products, the third product which has come into existence does not cease to be a petroleum product. It is not a sub-product of petroleum product as is sought to be argued. Even if ....

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....s contended that the exemption extended to the crushed bones and bone products would not be available to the company inasmuch as it was not a primary product obtained on crushing of bones such as bone sinew, bone grist and bone-meal. Repelling the argument, the Supreme Court held that the word "product" was defined in the dictionary. The word "product" means "anything produced or obtained as a result of some operation or work". The expression "bone product" therefore, means anything produced or obtained from bones. Whether such derivation was by a simple physical process or by a chemical reaction would not make any difference to the end-product. 6.. In the instant case also the raw materials or ingredients of LAB are petroleum products. ....