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by System Administrator - Monday, 23 February 2015, 5:16 AM

By: M.S.Yatnatti: Editor and Video Journalist Bangaluru: Ilkal town has about 150 Stone / Granite Cutting, Polishing units. It is pertinent to note that Government of Karnataka mines department has not renewed the leases of several quarries which were legitimately functioning in Bagalkot Dictrict and Government has not approved applications for limited period prospective licenses to the applicants for conducting projects on pilot basis. Without the supply of raw granites 150 Stone / Granite Cutting, Polishing units cannot function legitimately. Also government has increased the roayalty for granites blocks which is adversely affecting the Granite Cutting, Polishing units.Reportedly The association representing Stone / Granite making, Cutting, Polishing units is demanding from several years to reduce the royalty for domestic use and consumption and for rejected material of exports . Hungund Taluka is famous for Ilkal sarees, Ikal granite and Kudal Sangam. World famous pink granite and World famous Ilkal sarees are produced here. Recent development in Kudalasangam and the nearby Almatti dam & gardens have brought the taluka on the tourist map. Aihole of Pattadakal fame is situated in Hungund taluka. Availability of water, National highway and enterprising people are the wealth of this taluka.

Resale tax u/S 6-B not applicable for resale tax u/S 6-B ? : Karnataka high court in recent order has stated that "The stones are larger granite blocks purchased by its petitioner, eve when cut to the sizes to the requirement of the customers including as regards its thickness or polishing it continues to be a granite block. May be a smaller or thinner size, but it would continue to be a granite block however polished it may be. Even though it may be used as a building material, the granite block does not cease to be a granite block."This apart, excavation of stones from a mine and thereafter cutting them and polishing them innto slabs did not amount to manufacture of goods. The word 'manufacture' generally and in the ordinary parlance in the absence of its definition in the Act should be understood to mean bringing to existence a new and different article having a distinctive name, character or use after undergoing some transformation. When no new product as such comes into existence, there is no process of manufacture. Cutting and polishing stones into slabs is not a process of manufacture for the obvious and simple reason that no new and distinct commercial product came into existence as the end product still remained stone and thus its original identity continued". and this position was further reiterated as follows: "It is also not possible to accept that excavation of stones and thereafter cutting and polishing them into slabs resulted in any manufacture of goods." In view of the above decisions, cutting the granite blocks into small sizes and polishing them as tiles does not amount to manufacturing process to attract Sales Tax u/S 5 of the Act. However, whether the transaction attracts resale tax u/S 6-B can be looked into and considered by the Assessing Officer after giving opportunity to the parties. Accordingly, the substantial question of law is answered in favour of the assessee. Consequently the appeals are allowed”.