SRI VINAYAKA OIL INDUSTRIES Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) THE petitioner buys raw tamarind seeds. Thereafter the outer layer is removed and the seeds are "decorticated". According to the petitioner, there is no manufacturing activity involved and both the goods are the same. Since the petitioner purchases the tamarind from unregistered dealers and therefore, no tax was levied at the time of purchase by the petitioner, the sales tax department has taken the view that there is a manufacturing activity involved and the purchased articles were consumed in the manufacture of tamarind seeds which are sold by the petitioner and therefore, purchase tax was leviable under section 6 of the Karnataka Sales Tax Act, 1957 ("the Act" for short ). The articles allegedly produced by the petitioner is referred as tamarind white pappu and white powder, from black tamarind seeds. The short question is, whether there was any manufacturing activity at all and if so, certainly section 6 of the Act would be attracted.

(2.) LEARNED counsel for the petitioner contended that dehusking of tamarind seeds into taramind pappu does not result in the manufacture of any other product and any by-product. The purpose of the tamarind seed and that of the tamarind pappu is to provide starch. Qualitatively, both are the same goods whether the test of chemical analysis is applied or the commercial use is applied. Learned Government Advocate, on the other hand, relied on a decision of this Court in S. T. R. P. Nos. 35 and 36 of 1970, disposed of on May 27, 1971, wherein it was held that tamarind pappu is a different commodity from tamarind seed. This was in connection with the interpretation of item 14 of the Third Schedule to the Act which referred to only "tamarind seeds". This Court followed the decision of the Supreme Court in State of Travancore-Cochin v. Shanmugha Vilas Cashewnut Factory [1953] 4 STC 205; AIR 1953 SC 333.

(3.) IN Deputy Commissioner of Sales Tax v. Pio Food Packers [1980] 46 STC 63, the Supreme Court was concerned with pineapple slices sold in sealed cans. The question was whether there was consumption of pineapple fruit for the purpose of manufacturing pineapple slices sold in sealer cans. The finding was that there was no manufacturing activity at all. The Supreme Court was considering the provision under section 5a of the Kerala General Sales Tax Act which is almost similar to the provision under section 6 of the Act. At page 65, the Supreme Court observed :