COMMERCIAL TAXES OFFICER SPECIAL CIRCLE PALI MARWAR Vs. UMED SIZING FACTORY

JUDGEMENT

(1.) THESE three revision petitions arise from a common order passed by the Tribunal, therefore, these petitions are disposed of by a common order. The question involved in these revision petitions is that whether the respondent-assessee is entitled to the benefit under section 5c (1) or not.

(2.) THE assessee is a manufacturer of sized yarn. He purchases the yarns and then processes them in order to produce sized yarn. A notice was given to him by the assessing authority, Commercial Taxes Officer, Special Circle, Jodhpur, that the sized yarn does not involve a manufacturing process and, therefore, he is not entitled to the benefit under section 5c (1) of the Rajasthan Sales Tax Act, 1954 (hereinafter referred to as "the Act" ). THE assessing authority found that the processing of the yarn with the help of other ingredients does not involve manufacturing in terms of section 2 (k) of the Act. Aggrieved against this order the assessee approached the appellate authority, but without any result. Aggrieved against the order of the appellate authority he approached the Tribunal and the Tribunal after examining the matter in detail found that sizing of the yarn involves a processing and that is included in the definition of "manufacture" under section 2 (k) of the Act. THE Tribunal held that since there is entry in the registration certificate that the gum, starch and cellulose derivatives are necessary ingredients for manufacturing of the sized yarn, therefore, the assessee is entitled to the benefit of concessional rate of tax under section 5c (1) of the Act and he is not liable to pay a penalty under section 5c (1) of the Act, hence penalty was set aside. Aggrieved against the order of the Tribunal these three revision petitions have been filed by the State.

(3.) SO, in the wider context of the definition the manufacture includes the processing also. Mr. Mehta, learned counsel for the respondent, has also produced before me the extract from a book "'sizing' materials, method, machines". This is a publication of the textile trade process. In this, chapter 7 under the heading of the "adhesives-3, starch, gum and cellulose derivatives", it has been observed as under : " It has been seen that natural materials like starch, gum and other polysaccharides like TKP, proteins and pectins are some of the oldest adhesives used. However, no single natural adhesive has ideal properties. "