M. C. DESAI, C. J.

( 1 ) THIS and the connected references have been made by the Judge (Revisions) Sales Tax under section 11 (1) of the U. P. Sales Tax Act the question referred to being-Whether cane crushers are agricultural implements within the meaning of the words agricultural implements as mentioned in Government Notification No. S. T. 119/x-928 dated June 7, 1948 made under Section 4, U. P. Sales Tax Act of 1948 and hence exempt from U. P. sales tax.

( 2 ) THE question referred to in the connected Sales Tax Reference No. 455 of 1954 differs from this question, only in this respect that it includes boiling pans within its scope.

( 3 ) THE question arises because under notification issued by the State Government on 7th June, 1948, in exercise of the powers conferred by Section 4 of the Act "agricultural implements" have been exempted from the sales tax. The assessees in these references are dealers in cane crushers and boiling pans, and their case is that these articles are agricultural implements within the meaning of the notification and that consequently they are not liable to be taxed on their sale.

( 4 ) CANE crushers and boiling pans are used only in the manufacture of gur from sugarcane. Sugarcane is an agricultural produce and the process which results in the production of sugarcane is undoubtedly agriculture, but the production of gur from sugarcane is a manufacturing process and not an agricultural process. The agricultural process comes to an end with the production of sugarcane and when gur is subsequently being prepared it is manufacturing process that commences. Merely because sugarcane is an agricultural produce anything that is done to it after it is produced is not necessarily a continuation of the agricultural process. It cannot be doubted that agricultural produce can be subjected to a manufacturing process; merely because gur is produced out of sugarcane which is an agricultural produce, the process of preparing gur does not become an agricultural process. We respectfully agree with our brother B. L. Gupta, J. , when he said in Sardar Jogendra Singh v. Sales Tax Officer, Section 11, muzaffarnagar and Anr. [1962] 13 S. T. C. 250, that rah or jaggery is not an "agricultural or horticultural produce" within the meaning of the Sales Tax Act. If rob or jaggery is not an agricultural produce, gur also is not an agricultural produce and if it is not an agricultural produce the process of preparing gur is not an agricultural process and any implement that is used in preparing it is not an agricultural implement. An agricultural implement is an implement that is used in agriculture; any implement that is used after the agricultural process comes to an end and a manufacturing process commences, is not an agricultural implement.

( 5 ) WHAT amounts to "agricultural income" has been dealt with exhaustively by the Supreme court in Commissioner of Income-tax, West Bengal, Calcutta v. Raja Benoy Kumar Sahas Roy [1957] 32 I. T. R. 466. The question that arose before the Supreme Court was whether income from sal and piyasal trees in forest land is agricultural income within the meaning of the income-tax Act, which exempts it. The learned Judges observed at page 474 that the word "agriculture" is used in the narro sense of the cultivation of land and in the wide sense of comprising "all activities in relation to the land including horticulture, forestry, breeding and rearing of livestock, dairying, butter and cheese-making, husbandry etc. " It will be noticed that preparing rah or gur is not included in the activities which are included within the wider meaning of agriculture. At page 507 it was said:

Agriculture is the basic idea underlying the expressions agricultural purposes and agricultural operations and it is pertinent therefore to enquire what is the connotation of the term agriculture. As we have noted above, the primary sense in which the term agriculture is understood is agar-field and cultra-cultivation, i. e

Click Here to Read the rest of this document