BALIA, J. - (1.) HEARD learned counsel for the parties.
(2.) THIS revision raises two issues : (i) firstly, whether the process of converting dolomite into powder by grinding and making chips out of it amounts to process of manufacture so as to bring out any new commercial commodity so as to fall within the definition of manufacture under the Rajasthan Sales Tax Act, 1954. (ii) The other controversy is whether the grinding of marble into powder result in bringing new commercial commodity distinct from marble which can be considered as manufacture within the meaning of Rajasthan Sales Tax Act. The answer to these questions would determine whether the respondent-assessee is engaged in manufacture unit of goods to make it eligible to avail the benefit of the Sales tax Incentive Scheme for Industries, 1987 notified under the Rajasthan Sales Tax Act, 1954. The District Level Screening Committee rejected the claim of the respondent to treat both the activities as manufacture within the meaning of the Scheme. The Rajasthan Tax Board on appeal, referring to its earlier decision in Assistant Commercial Taxes Officer vs. G. S. Industries, Bikaner, decided on 14. 7. 98 has remanded the case back to the District Level Screening Committee by setting aside its earlier order to re-consider the case of the respondent industry de-novo in the light of the aforesaid judgment. Aggrieved with the order of Rajasthan Tax Board, this revision has been filed by the Commercial Taxes Officer, Rajsamand. At the very outset, it has been pointed out by the learned counsel for the revenue that so far as the issue relating to subjecting dolomite to the process of converting its lump into chip or powder is concerned, is set at rest by Supreme Court in Divisional Deputy Commissioner of Sales Tax & Another vs. Bherhaghat Mineral Industries (1 ). The apex Court has affirmed the decision of Madhya Pradesh High Court in Bheraghat Mineral Industries vs. Divisional Deputy Commissioner of Sales Tax The apex Court has upheld the decision of M. P. High Court and its conclusion that dolomite and dolomite powder or dolomite chips are not different commercial commodities in the commercial world and therefore, the activity of making powder to dolomite lumps by grinding is not a manufacturing process. Supreme Court in its short order said : " We are satisfied that crushing of dolomite lumps into chips and powder is not a process of manufacture that brings about a new commercial commodity. The view taken by the High Court must, therefore, be upheld. "
(3.) THIS takes us to decision of High Court of M. P. in Bheraghat Industries vs. Divisional Deputy Commissioner of Sales Tax (supra ). Reasonings of the High Court which were affirmed by Supreme Court by reference, unfolds the premises on which the judgment proceeded. The Court found : " The petitioner in that case after purchasing lumps of dolomite from registered dealers, crushed them and sold chips and powder to glass manufacturers. What was purchased was dolomite and sale was also of dolomite. Chips and powder of dolomite are not different commercial commodities than dolomite lumps. It is not the respondents case in their return that anything more is required to be done, except crushing the lumps to get chips and powder from the lumps and that the composition of the end-product is different from lumps. The lumps are broken into chips and powder for convenience in use but they retain the same characteristics and qualities of dolomite lumps. . . . . It appears from the vouchers produced by the respondents that the petitioner had supplied dolomite lumps, chips and powder to different glass manufacturers as required by them. Some manufacturers may not be having crushing facilities or of sufficient capacity. So they purchased in powder form also. " With this background, the commodity purchased was dolomite in lump shape. The chips or powder brought into existence by crushing the dolomite was also sold as `dolomite' only and the change in shape only for convenience in use by buyers, but otherwise the commodities in different shapes are being sold to the same kind of buyers for its use for the same purpose. Significantly no change in functional utility of dolomite was brought about. Dolomite remained to be used for same purpose by same persons whether it was sold to them in lump form or in powder or chips form. This premise led to the conclusion that conversion of dolomite lumps into the powder or chips does not bring into existence different commercial commodity, therefore, it does not amount to process and manufacture. Clearly the conclusion depended on finding that there was no functional change in the commodity and there was no change in physical or chemical properties either. Thus, dolomite in different shapes was traded with same nomenclature and was not treated as commercially a different item even by the commercial world. ;