TaxTMI 
TaxTMI 
1998 (3) TMI 635
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....for sales tax exemption certificate. It is also stated that the manufacture for the purpose of S.R.O. No. 499 of 1990 dated March 31, 1990 means the use of raw materials and production of goods commercially different from raw materials used and that in the case of the petitioner raw materials and finished products are one and the same. Aggrieved by the said order, the petitioner filed exhibit P6 petition before the Government with a copy to the Director of Industries and Commerce, Trivandrum. By exhibit P7, the office of the Finance Minister informed the petitioner that the said petition has been forwarded to the concerned secretary for necessary action. The Director of Industries considered the said application and informed the petitioner that as per the existing directions from the Government, metal crushing unit is not eligible for sales tax exemption. It is seen that the petitioner has made a further petition to the Government in the Industries Department evidenced by exhibit P9, a copy of the same was also sent to the Director of Industries and Commerce, Trivandrum. To the said petition also the Director of Industries and Commerce sent reply evidenced by exhibit P10 stating th....
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....ting up new industries should have considered the matter sympathetically by granting exemption from sales tax to the unit of the petitioner, who is engaged in the metal crushing industry. Learned counsel alternatively submitted that the second respondent may be directed to consider exhibit P6 application and pass appropriate orders thereon. 3.. Learned Government Pleader appearing for the respondents, on the other hand, submitted that the process of converting big boulders and stones into metals of different sizes will not amount to a manufacturing process and that the endproduct so completed can never be understood as a commercially different article. Going by the various decisions of the Supreme Court, learned Government Pleader further submitted that the definition of "manufacture" contained in the circular only refers to the general meaning of the term "manufacture" as understood in the common parlance and in the commercial world. He also submitted that applying the common parlance test or the functional test, it cannot be said that a new commercially different commodity emerged by the process employed by the petitioner. He accordingly submitted that exhibits P4, P8 and P10 ....
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....l-scale industrial unit, in S.R.O. No. 499 of 1990 the exemption is in respect of the turnover of goods manufactured by the S.S.I. unit. So in view of what I have stated earlier, what is relevant to be considered in this case is as to whether the process of converting big boulders into metals of various sizes, namely, 20 mm, 12 mm, and 6 mm gravel can be said to be goods produced by the units. The dictionary meaning of the word "produce" is "to bring forward or out, to extend; to bring into being; to bring forth", etc. The Supreme Court considered the meaning of the expression "produce" in the context of the definition of "dealer" in section 2(viii), clause (e) of the Kerala General Sales Tax Act, 1963. The Supreme Court observed that the context in which the word "produce" appears in the definition of "dealer" can only mean "to bring forth, to bring into being or existence; to bring a thing into existence from its raw materials or elements". For the said conclusion, the Supreme Court relied on the meaning of the word "produce" in the Shorter Oxford English Dictionary. The Supreme Court had occasion to consider the meaning of the expressions "manufacture", "production", "produce....
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....ind of processing at each stage. With each process suffered, the original commodity experiences a change. But it is only when the change, or a series of changes, take the commodity to the point where commercially it can no longer be regarded as the original commodity but instead is recognised as a new and distinct article that a manufacture can be said to take place.' The word 'production' or 'produce' when used in juxtaposition with the word 'manufacture' takes in bringing into existence new goods by a process which may or may not amount to manufacture." 5.. In order to get the benefit of Notification S.R.O. No. 968 of 1980, it is necessary for the petitioner to establish that the product dealt with by the petitioner is a different product obtained by him from the raw material by some processes. The question therefore is can it be said that the conversion of big metals into different sizes to suit the requirements of various customers does bring into existence a new and distinct commercial commodity other than the raw materials used. 6.. In view of the above authoritative pronouncement of the Supreme Court, it has to be held that big boulders and stones even after convers....