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204 Goods & Services Tax Cases - Reports [Vol. 1 not change. We regret, we cannot agree with his submission. Firstly, we do not agree that the coal briquettes are the same commercial commodity as coal. In our opinion, coal is a raw material for making coal briquettes. The method of manufacturing coal briquettes has been stated above, and this certainly is a processing, treating or adapting the coal. The appellant manufactures coal briquettes by compiling the hard coke breeze mechanically with the help of cinders which is usually 5 per cent of the total hard coke breeze. In the compilation of the hard coke breeze, 95 per cent of the hard coke breeze, which is known as coal-dust or breeze coke is taken which is compiled with the help of clay and molasses. Hence, in our opinion, coal briquettes is a different commercial commodity from coal. Moreover, even if it is not a different commercial commodity, the process of making coal briquettes will amount to a “manufacture” as it is processing, treating or adapting coal. In our opinion, by the processing of coal to make coal briquette, the coal-dust loses its identity. Coal briquettes and coal-dust are two different commodities in substance as well as in characteristics. The coal briquettes are altogether in different shape, form and moisture as well as characteristics, as compared to coal-dust.” 21. Admittedly coal breeze is being burnt at a specific temparature to remove the impurities from the coal. It involves some process. By process of burning, the coal ceases its original character. Hard coke which is obtained out of the aforesaid process is highly combustible and is commercially known as a different commodity. Therefore, the process involved in converting the coal into hard coke is the process of manufacturing within the ambit of section 2(ee) of the Act and, therefore, sales made by the applicant of such hard coke is liable to tax. The Tribunal has erred in granting exemption on the turnover of hard coke. The order of the Tribunal is erroneous and is liable to be set aside. 22. Learned counsel for the applicant has relied <strong>up</strong>on two decisions of this Court; one in the case of Khanna Coke Industries Ltd. v. Assistant Commissioner, Sales Tax 1978 UPTC 473 and another in the case of Ashoka Industries v. Commissioner of Sales Tax 1989 UPTC 562, wherein this Court has held that coal briquettes fall within the entry of all kinds of coal. Relying <strong>up</strong>on the aforesaid decisions, learned counsel for the applicant submitted that hard coke is also one of the forms of the coal and, therefore, once the tax has been paid on the coal, the applicant is not liable for further tax on hard coke. In my view, the aforesaid two decisions are not relevant to the issue involved in the present case. Hard coke for the purposes of rate of tax may fall within the entry of “coal of all kinds” being one of the forms of coal but the question involved in the present case is whether the applicant is liable to tax on the sale of hard coke as a manufacturer and the process of converting the coal into hard coke amounts to manufacturing. If the process of conversion of coal into hard coke amounts to manufacturing and the hard coke is a different commercial commodity than the coal, the applicant is liable to tax on the sale of hard coke being the manufacturer. In view of above, in my view, the process of conversion of coal into hard coke amounts to manufacturing within the ambit of section GOODS & SERVICES TAX CASES ❑ JANUARY 20 - FEBRUARY 4, 2010 ◆ 80 A B C D E F G
2010] State of Kerala v. Thrimathy Contracting Co. (Ker.) 205 A B C D E F G 2(ee) of the Act. The applicant is liable to tax on the sale of hard coke being the manufacturer. 23. For the reasons stated above, the revision is allowed. The order of the Tribunal is set aside and the order of the assessing authority is restored. ■■ [2010] 1 GST 205 (KER.) HIGH COURT OF KERALA State of Kerala v. Thrimathy Contracting Co.* C.N. RAMACHANDRAN NAIR AND V.K. MOHANAN, JJ. ST REV. NO. 303 OF 2008 (C.R.) SEPTEMBER 8, 2009 WORKS CONTRACT - Payment of tax at compounded rates - Assesseefirm was awarded work for marking of National Highway with hot white and yellow thermoplastic road marking paint - Assessee claimed that work for paint marking constituted civil works within meaning of section 7(7) entitling it for payment of tax at compounded rate of 2 per cent - Whether since under section 7(7), payment of tax at compounded rate of 2 per cent is provided only if work awarded is a civil work, which includes construction also, and further since marking of road is not a part of construction of road and it is a post-construction work done for safe vehicular movement and purpose is to guide drivers and pedestrians using road, work for marking of roads with paint did not constitute civil work within meaning of section 7(7) - Held, yes - Whether, therefore, assessee was not entitled for payment of tax at compounded rate of 2 per cent - Held, yes [Section 7 of the Kerala General Sales Tax Act, 1963] FACTS The assessee-firm was awarded work for marking of National Highway with hot white and yellow thermoplastic road marking paint. Under the work schedule, payment was for every square feet of painting work done on road in terms of the instructions of the PWD. Further, paint marking on *In favour of revenue. GOODS & SERVICES TAX CASES ❑ JANUARY 20 - FEBRUARY 4, 2010 ◆ 81
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