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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]

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   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: