Supreme Court of India
Dy. Commissioner Of Sales Tax (Law), ... vs Coco Fibres on 4 December, 1990
Equivalent citations: 1991 AIR 378, 1990 SCR SUPL. (3) 419, AIR 1991 SUPREME COURT 378, 1991 AIR SCW 8, (1990) 4 JT 618 (SC), 1990 (4) JT 618, 1992 (1) SCC(SUPP) 290, 1991 KERLJ(TAX) 110, 1991 (1) UPTC 233, 1991 UPTC 1 233, 1992 SCC (SUPP) 1 290, (1991) 53 ELT 515, (1991) 31 ECC 226, (1991) 32 ECR 161, (1991) 1 KER LT 129
Author: K. Ramaswamy
Bench: K. Ramaswamy, Kuldip Singh
PETITIONER:
DY. COMMISSIONER OF SALES TAX (LAW), BOARD OFREVENUE(TAXES,)
Vs.
RESPONDENT:
COCO FIBRES
DATE OF JUDGMENT04/12/1990
BENCH:
RAMASWAMY, K.
BENCH:
RAMASWAMY, K.
KULDIP SINGH (J)
CITATION:
1991 AIR 378 1990 SCR Supl. (3) 419
1992 SCC Supl. (1) 290 JT 1990 (4) 618
1990 SCALE (2)1214
ACT:
Kerala General Sales Tax Act: Section 5A--'Coconut husk'
Whether coconut fibre a separate identity from 'Coconut
husk'.
HEADNOTE:
The assessee is a registered dealer under the Kerala
General Sales Tax Act. In its return of taxable turnover,
the assessee excluded the value of coconut husks purchased
and converted into coconut fibre on the ground that there
was no manufacturing process involved in making fibre from
coconut husk.
The Sales Tax Officer as well as the Appellate Authority
negatived the assessee's claim. The Sales Tax Appellate
Tribunal however, allowed the assessee's revision, and the
High Court confirmed the order of the Tribunal.
Allowing the appeal of the Revenue, this Court,
HELD: (1) By the process of manufacture something is
produced and brought into the existence which is different
from that, out of which it is made in the sense that the
thing produced is by itself a commercial commodity capable
of being sold or supplied. The material from which the thing
or product is manufactured may necessarily lose its identity
or may become transformed into the basic or essential
properties. [421D-E]
Ujagar Prints v. Union of India, [1989] 3 SCC 488, referred
to.
(2) The test laid down by this Court is that the article
which comes into being must be commercially different from
the one from which it is made or manufactured. [422D]
State of Bihar v. Chrestien Mica Industries Ltd., [1956]
7 S.T.C. 626 and Commissioner of Sales Tax v. Harbilas Rai &
Sons, [1968] 21 S.T.C. 17 (S.C.), referred to.
(3) In view of the admitted position that green husk is
soaked into saltish sea water for days together and after
decomposition, on being subjected to beating either by
manual or mechanical process, fibre is produced in the
process, which is a distinct commodity known in the
420
commercial parlance. No one in the market would sale or
supply husk when fibre is asked for. [422E]
Dy. Commissioner of Sales Tax (Law) v. Pie Food Packers,
[1978] 41 S.T.C. 364, distinguished.
(4) The Coconut fibre is commercially a different iden-
tifiable commodity known as such in commercial parlance.
Therefore, the value of sale or purchase of coconut husk
would attract purchase tax under section 5-A of the Sales
Tax Act. [422G]
JUDGMENT: