H.G. Mishra, J.
1. This is a reference under Section 44(1) of the Madhya Pradesh General Sales Tax Act, 1958, at the instance of the Commissioner of Sales Tax, Madhya Pradesh. The question referred to us for our answer is as under :
Whether, under the facts and circumstances of the case, the Tribunal was justified in holding that extraction of and collection of boulders does not amount to manufacture?
2. The assessee, M/s. Pannalal Fundilal of Dewas had taken a contract for supply of boulders to the Soil Conservation Department on 16th February, 1967 and the supplies of boulders up to 20th May, 1967, were of the value of Rs. 19,977.55. The liability of the assessee was fixed with effect from 4th March, 1967, as a manufacturer under Section 4(5)(b) of the M.P. General Sales Tax Act, 1958 (for short, the Act) and tax amounting to Rs. 898.68 was assessed by the Sales Tax Officer on a taxable turnover of Rs. 14,977,55. A penalty of Rs. 500 was also imposed under Section 18(6) of the Act by the Sales Tax Officer. The order passed by the Sales Tax Officer was maintained on appeal by the Appellate Assistant Commissioner of Sales Tax, Indore, vide order dated 7th April, 1973.
3. In the second appeal which the assessee then preferred, the Board of Revenue took the view that the assessee was not liable to pay any sales tax because the collection and extraction of boulders does not amount to manufacture as defined by Section 2(j) of the Act. Consequently, having regard to the turnover the liability to pay sales tax will not arise under Section 4(5)(b) of the Act. Thereafter on an application at the instance of the Commissioner of Sales Tax, this reference has been made.
4. In our judgment the Tribunal has rightly held that the assessee was not a manufacturer. The assessee had merely supplied boulders collected by him from various hillocks and this process of collection cannot be regarded as manufacture within the contemplation of Section 2(j) of the Act, which reads as under:
2. (j) 'Manufacture' includes any process or manner of producing, collecting, extracting, preparing or making any goods and in respect of trees which have been severed from the land or which have been felled, also the process of lopping the branches, cutting the trunks or converting them into logs, poles or bailies or any other articles of wood, but does not include such manufactures or manufacturing processes as may be prescribed.
Section 4(5)(b) of the Act at the relevant time stood as under :
4. (5)(b) In relation to a dealer who manufactures any goods other than curd and cooked food including sweets and sweetmeats, mishri, batasha, chironji, shrikhand, rabadi, doodhpak but excluding ice-cream, kulfi, ice-candy, non-alcoholic drinks containing ice-cream, cakes, pastries, biscuits, chocolates, toffees, lozenges and peppermint drops.-(Ten thousand rupees).
The word 'manufactures' used in the aforesaid section is a verb. In Union of India v. Delhi Cloth and General Mills AIR 1963 SC 791, it has been observed as under :
The word 'manufacture' used as a verb is generally understood to mean as 'bringing into existence a new substance' and does not mean merely 'to produce some change in a substance' however minor in consequence the change may be. This distinction is well brought about in a passage thus quoted in Permanent Edition of Words and Phrases, Vol. 26, from an American judgment. The passage runs thus:
Manufacture' implies a change, but every change is not manufacture and yet every change of an article is the result of treatment, labour and manipulation. But something more is necessary and there must be transformation ; a new and different article must emerge having a distinctive name, character or use.
So also in Commissioner of Sales Tax, U.P. v. Harbilas Rai & Sons  21 STC 17 (SC), their Lordships of the Supreme Court observed as under :
In our view, the word 'manufacture' has various shades of meaning and in the context of sales tax legislation, if the goods to which some labour is applied remain essentially the same commercial article, it cannot be said that the final product is the result of manufacture....
Although Section 2(j) of the Act defines the word 'manufacture' as including any process or manner of producing, collecting, extracting, preparing or making any goods, it does not include such manufacture or manufacturing process, as may be prescribed. This definition is solely for making it plain that at certain places in the Act the word 'manufacture' has the meaning given to it by the definition. However, the artificial concept given to the word 'manufacture' by that definition cannot be read as making any process or manner of producing, collecting or extracting, etc., itself a manufacture in the sense of bringing into existence a new substance which is capable of being sold. In view of the principles laid down by the Supreme Court in the two decisions referred to earlier on the meaning of the word 'manufacture' used as a verb, it has to be held that the assessee is not a manufacturer.
5. In view of the aforesaid discussion, we answer the question, referred to us, in the negative. The assessee shall get the costs of this reference. Counsel's fee shall be at Rs. 75, if certified.