TaxTMI 
TaxTMI 
2015 (5) TMI 293
X X X X Extracts X X X X
X X X X Extracts X X X X
....f 2013, 981 of 2013, 67 of 2013, 114 of 2013 and 115 of 2013 by holding that the process undertaken by the dealer on Natural Sesame Seeds (hereinafter referred to as 'NSS') converting them into Huld Sesame (hereinafter referred to as 'HS') is the process of 'manufacture' and hence, the dealer is entitled to input tax credit paid on purchases of fuel, machinery parts, packing material and other consumable and processing material, if any and consequently, deleting levy of penalty and charging of interest on additional dues, the common appellant - State of Gujarat has preferred the present tax appeals with the following proposed questions of law:- "(1) Whether the Hon'ble Tribunal has erred in adjudicating issues on merits instead of restricting itself to the issue of pre-deposit? (2) Whether the Hon'ble Tribunal in the facts and circumstances has erred in law and in facts in holding that the process undertaken by the dealer is "manufacture" as per Section 2(14) of the act? (3) Whether the Hon'ble Tribunal has erred in deleting levy of penalty u/s 34(12) of the Act and also erred in deleting levy of interest?" 3. Considering the fact that in some of the appeals before the learned ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....before the learned Tribunal being Second Appeal Nos.65 of 2013, 980 of 2013, 981 of 2013, 67 of 2013, 114 of 2013 and 115 of 2013. 4.4. That, by impugned common judgment and order and relying upon the decision of the Division Bench of this Court in the case of Laxmi Oil Mills Ltd. V/s. Commissioner of Sales Tax, Ahmedabad reported in (1994) Vol.92 STC 174, the learned Tribunal has allowed all the aforesaid appeals and has held that the process undertaken by the dealer while converting the NSS to HS, can be said to be the process of manufacture and, therefore, the dealer is entitled to the input tax credit, as claimed. Consequently, the learned Tribunal has quashed and set aside the penalty levid and charging of interest on the additional dues. Similar is in the case of M/s.Keshav Till Factory (Second Appeal No.65 of 2013) but with respect to the different product. 4.5. Feeling aggrieved and dissatisfied with the impugned common judgment and order passed by the learned Tribunal, the State has preferred the present tax appeals with the aforesaid proposed substantial questions of law. 5. Ms.Vacha Desai, learned A.G.P. appearing on behalf of the State has vehemently submitted that th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ted in (1993) Vol.91 587 in support of her submission that the process undertaken by the dealer in the present case while converting the NSS to HS, will not fall within the definition of 'manufacture' as provided under Section 2(14) of the Act. 5.6. Ms.Desai, learned A.G.P. has also relied upon the decision of the Hon'ble Supreme Court in the case of State of Maharashtra V/s. Shiv Datt and Sons reported in (1992) Vol.84 STC 497 in support of her submission that every process does not amount to manufacture. It is submitted that in the aforesaid decision, the Hon'ble Supreme Court has specifically observed and held that the every process with reference to the goods purchased shall not fall within the definition of manufacture. It is submitted that as observed by the Hon'ble Supreme Court in the said decision, whether goods after process substantially remains the same, such a process shall not come within the definition of 'manufacture'. Making the above submissions and relying upon the above decisions, it is requested to admit/allow the present tax appeals. 6. Heard Ms.Desai, learned A.G.P. appearing on behalf of the State at length. We have also conside....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the product NSS will be converted into altogether a new product named Huld Sesame. Thus, not only the form will be changed but the NSS initially which was not eatable, would now become eatable and marketable. In light of the above process, the controversy in the present appeals is whether the aforesaid process undertaken by the dealer can be said to be the process for 'manufacture' within the definition of Section 2(14) of the Act or not is to be considered. 10. Identical question came to be considered by the Division Bench of this Court in the case of Laxmi Oil Mills Ltd. (supra) which has been relied upon by the learned Tribunal while passing the impugned common judgment and order. In the case before the Division Bench of this Court, the Division Bench was considering the definition of 'manufacture' defined under Section 2(16) of the GST Act and Rule (3) of the Gujarat Sales Tax Rules, 1970 (hereinafter referred to as the 'Rules'). In the said decision, it has observed by the Division Bench of this Court that wider meaning is given to the word "manufacture". It is further observed that the definition of "manufacture" is very wide and includes several activities such as ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... NSS to HS can be said to be the process of 'manufacture' within the meaning of Section 2(14) of the Act and consequently, the dealer would be entitled to the input tax credit. As observed hereinabove, as such, by the process undertaken by the dealer, seeds which was initially not marketable and eatable, would become eatable and marketable and, therefore, there will be change in the form. 12. Now, so far as the reliance placed upon the decision of the Hon'ble Supreme Court in the case of Shiv Datt and Sons (supra) by Ms.Desai, learned A.G.P. appearing on behalf of the State is concerned, on considering the aforesaid decision and the process undertaken by the dealer, we are of the opinion that the said decision would not be applicable to the facts of the case on hand and/or the same shall not be of any assistance to the appellant. In the case before the Hon'ble Supreme Court considering the process undertaken, the Hon'ble Supreme Court opined that the process of removing the electrolyte and plates from the batteries cannot be said to be the process of 'manufacture' and will not come within the definition of the 'manufacture'. While holding so, the Hon'ble Supreme Court has specific....