J SRIRANGAM BROTHERS Vs. SALES TAX OFFICER GANJAM CIRCLE BERHAMPUR

JUDGEMENT

(1.) THESE eleven original jurisdiction cases involve the same questions of law and they were all heard together and will be disposed of in one judgment. The petitioners are all merchants of Berhampur town carrying on the business of selling gold and silver ornaments. They claim exemption from payment of sales tax in respect of the sales of some gold ornaments on the ground that they were manufactures of those ornaments and that while selling the same they were charging separately for the value of gold and the cost of manufacture. The exemption was claimed by virtue of Notification No. 8728 - C.T. - 66/49 F dated the 1st July, 1949, of the Government of Orissa in the Finance Department issued in pursuance of section 6 of the Orissa Sales Tax Act, 1947, exempting certain classes of sales from payment of sales tax. The item with which we are concerned in these petitions is item 33 of the said notification which is as follows :-

(2.) ON these facts, the Sales Tax Officer, Ganjam Circle, Berhampur, held that the petitioners were not "manufacturers" within the meaning of the exemption clause. According to him the expression "manufacturer" would only mean a person who either manufacturers the finished product with his own hand or gets it done by his paid employees working in his own factory; and independent artisans who, with their own tools, convert the gold into ornaments either at their own houses or at the petitioners' shop on payment of labour charges, will not be his employees and that they would be the real manufacturers, the petitioners' position being only that the middlemen or order-suppliers.

(3.) THE dictionary meaning of the word "manufacturer" is "to work up material into forms suitable for use or to make or fabricate from material, to produce by labour, now especially on a large scale." Doubtless, in a statute dealing with sales tax it must, in the context, mean - "to bring into existence something in a form in which it is capable of being sold or supplied in the course of business". Manufacture for the purpose of one's own consumption is not obviously contemplated in a sales tax law. The term "manufacturer" must, therefore, mean necessarily one who brings into being from raw materials finished goods which are capable of being sold in the course of business.