1 abs IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION SALES TAX APPLICATION NO. 19 OF 2007 IN REFERENCE APPLICATION NO. 58 OF 2005 The Commissioner of Sales Tax, Maharashtra State .. Applicant V/s M/s Dakini Health Foods Pvt. Ltd. .. Respondent Mr. J.S. Saluja, A.G.P. For the applicant. Mr. C.B. Thakkar for the respondent. CORAM : F.I. REBELLO & D.G. KARNIK, JJ. DATE : 7TH AUGUST 2009 P.C. : 1. The issue arises in this application is whether making of peanut butter from peanuts amounts to manufacture? 2. In Dakini Health Foods Pvt. Ltd. v. State of Maharashtra, 2005(031)- MTJ-0674-TMAH, the process for making of peanut butter has been set out. We gainfully reproduce the same: “Groundnuts are purchased from market. After cleaning and 2 drying, a special grinding process is applied. In the grinding process peanuts are crushed into superfine powder and some oil is also separate from the peanuts, finally it becomes a peanut paste. This paste is marketed as “Peanut Butter”, after packing in glass bottles. The paste is used to spread on bread and also used in Restaurant, Bakeries and in Cooking Process of vegetables. In the whole process nothing is added in the groundnuts, no preservative or salt is added. It is a pure virgin paste of groundnuts only.” 3. “Manufacture” is defined under section 2(17) of the Bombay Sales Tax Act, 1959. We may gainfully refer to section 2(17)(a): “2. Definitions.- In this Act, unless the context otherwise requires.- (17) “manufacture”, with all its grammatical variations and cognate expressions, include,- (a) producing, making, extracting, altering, ornamenting, finishing or otherwise processing treating, or adapting any goods, or using or applying any such process, as the State Government may, having regard to the impact thereof on any goods or to the extent of alteration in the nature, character or utility of any goods brought about by such process by notification in the Official Gazette, specify” 4. In our opinion, therefore, the following questions arise for our consideration. 3 (i) Whether the Tribunal is justified in holding that the process of converting peanut and seasame to peanut butter and seasame butter respectively does not amount to manufacture as contemplated in clause (17) of section 2 of the Bombay Sales Tax Act, 1959? (ii) Whether the Tribunal is justified in holding that peanut and seasame butter is not commercially distinct commodity than peanut and seasame? 5. The Tribunal is, therefore, directed to make a reference in respect of the above two questions. The reference to be made within 8 weeks from the date of receipt of this order. 6. The application is disposed of accordingly. (D.G. KARNIK, J.) (F.I. REBELLO, J.)