MANGANESE ORE INDIA LTD.versusSTATE OF M.P. & ORS.

                            [2016] l 1 S.C.R. 780


A                    MANGANESE ORE INDIA LTD.
                                      v.
                          STATE OF M.P. & ORS.
                      (Civil Appeal No. 2464 of 2016)
B
                           NOVEMBER 10,2016
           [DIPAK MISRA AND SHIVA KIRTI SINGH, JJ.]
           Madhya Pradesh Electricity Duty Act, 1949 - Explanation
    (b) of Part B of Table of Rates of Duty to s. 3(1) -Interpretation of
c   term "processing" under the definition of "mine" - Grievance of
    appellant pertains to definition of "mine" the effect of which is to
    make processing a part of mining and prescription of higher rate of
    duty for "mines" (i.e. a composite activity of mining and
    processing) - Propriety of- Held: The word "processing" herein
D   would mean those processes with help of hands or machineries
    connected and linked to mining activity- It would not include process
    by which a new or differe.nt article other than one which has been
    mined, is produced-The intent and purpose is certainly not to compel
    and force a manufacturing unit set up at an acceptable distance
E   fi·om mine to pay electricity tariff at a higher rate - Pertinently, a
    mamifacturing unit whether adjacent to the mine or not, would pay
    a lower tariff - Thus, tariff has to be levied as meant for
    mamifacturing unit- Electricity Tariff- Interpretation ofstatutes -
    Maxim - Noscitur a sociis - Mines and Minerals.
F         Madhya Pradesh Electricity Duty Act, 1949 - Explanation
    (b) ofPart B of Table of Rates of Duty to s. 3(1) - Interpretation of
    term "mineral" under the definition of "mine" - Plea of appellant
    that manganese ore is a mineral butferro manganese is not a mineral
    because the said mineral is converted into "alloy" and ceases to be
G   mineral - However, the State contended that definition is an inclusive
    one - Held: Appellant was using manganese ore as one of the raw
    materials and consuming the same while manufacturing ferro
    manganese alloy - The stage of crushing, treating, processing, etc.
    of manganese ore was in Integrated Manganese Beneficiation Plant
    (!MB Plant) stage, same cannot be applied in Ferro Manganese
H
                                   780
  MANGANESE ORE INDIA LTD v. STATE OF M.P. & ORS.                         781


Plant Stage - Thus, Ferro Manganese Plant, being a unit involved           A
in manufacturing o,f ferro manganese alloy as opposed to a unit
involved in crushing, treating, processing, etc. of manganese ore,
cannot be treated within the extended definition of 'mine' - Mines
and Minerals.
      Allowing the appeals, the Court                                      B

      HELD: 1. The words 'crushing', 'treating' and 'transporting'
are words of narrower significance and the word 'processing' used
between these words should not be given a very wide meaning,
for the legislative intent is narrower. The word 'processing' would
take its meaning in the cognate sense. In other words, the general
                                                                           c
word 'processing' will be restricted to the sense conveyed by the
words 'crushing', 'treating' and 'transporting'. The intent being
that electricity tariff payable in respect of mining activities would
include the mine itself, all machinery situated or located in the
mine or in a premises adjacent to the mine wherein crushing,               D
processing, treatment or transportation of the minerals as mined
is undertaken. The word 'processing' herein would mean those
processes with the help of hands or machineries connected and
linked to mining activity. It would not include process by which a
new or different article other than the one which has been mined,           E
is produced. It relates and signifies the composite activity of
mining and processing. The intent is not to include processes
which would lead to creation of a different commodity as known
in the commercial world for otherwise even manufacturing activity
would get covered, whereas manufacturing unit is liable to pay              F
electricity tariff at a lower rate. The intent and purpose is certainly
not to compel and force a manufacturing unit being set up at an
acceptable distance from the mine, for the manufacturing unit
adjacent to the mine would have to pay electricity tariff at a higher
rate. Pertinently, a manufacturing unit set up by another entity,           G
whether adjacent to the mine or not, would pay a lower tariff.
Such absurdity and irrationality has to be avoided. In the present
context, therefore, 'processing' would mean activities in order
to make the mineral mined marketable, saleable and
transportable, without substantially changing the identity of the
                                                                            H
782           SUPREME COURT REPORTS                    (2016] 11 S.C.R.



A     mineral, as mined. When there is a substantial change at the
      mineral mined and the process results in a different commodity
      being produced or transforming and completely changing the
      mineral, it would fall outside the scope of the word 'processing'.
      The restricted construction will also be acceptable in view of the
B     use of the word 'mineral' in the end of the Explanation. The word
      'mineral' in the Explanation is the product which was mined and
      is put to 'crushing', 'processing', 'treatment' and 'transporting'
      the mineral. In other words, mineral means mineral which was
      mined and not a new product created by using or processing the
c     mineral mined. [Para 20] [796-G; 797-A-G]
           Rohit Pulp and Paper Mills Ltd. v. Collector ofCentral
           Excise 1990 (2) SCR 797 : 1990 (3) SCC 447;
           Ahmedabad Pvt. Primary Teachers' Association v.
           Administrative Officer & Ors.2004 (1) SCR 470 : 2004
D          (1) SCC 755; CIT v. Tara Agency 2007 (8) SCR 136 :
           2007 (6) SCC 429; Orient Paper and Industries v.
           State Qf MP. and Anr. 2006 (8) Suppl. SCR 790 : 2006
           (12) SCC 468; and Aspinwall & Co. Ltd. v.
           Commissioner of Income Tax, Ernakulam 2001 (2)
 E
           Suppl. SCR 559 : 2001 (7) SCC 525- relied on.
         2.1 Following is the seriatim in which the mining/
   processing/manufacturing takes place: (a) First Stage : The
   appellant mines manganese ore from its mines. There is a levy
   of electricity duty on the appellant's consumption of electricity
 F during mining at 40%, which the appellant is not disputing; (b)
   Second Stage: Such mines manganese ore is processed by
   removal of impurities in the appellant's Integrated Manganese
   Beneficiation Plant (IMB Plant). During this process the cleaning
   of mineral takes place by various methods to remove impurities
 G and foreign contents for the enrichment of the manganese content
   and during this process, the manganese mineral remains a mineral.
   There is a levy of electricity duty on the appellant's consumption
   of electricity of IMB Plant at 40%, which the appellant is not
   disputing; (c) Third Stage: At the Ferro Manganese Plant, raw
   materials like, processed manganese ore (for which 40%
H
  MANGANESE ORE INDJA LTD v. STATE OF M.P. & ORS.                      783



electricity duty is already paid by IMB Plant), iron ore, coke,         A
dolomite, coal, carbon, etc., are by way of a manufacturing process.
A completely new product commercially known and sold in the
market as ferro manganese alloy which is a different product with
different chemistry and, through smelting in furnace. [Para 23]
[799-C-G]                                                               B
      2.2 To bring the Ferro Manganese Plant of the appellant
within the meaning of' mine', the State has argued that the Ferro
Manganese Plant is being "used for crushing, processing, treating
or transporting" the mineral, that is, manganese ore. This is
clearly unsustainable as the appellant is neither crushing or           c
processing or treating or transporting manganese ore but rather
using it as one of the raw materials and consuming the same while
manufacturing ferromanganese alloy. The state of crushing,
treating, processing, etc. of the manganese ore (mineral) was in
the IMB Plant (second stage), where the appellant is paying             D
electricity duty at 40%. The same rate cannot be applied in the
Ferro Manganese Plant (the third stage) as it cannot be taken to
be within the meaning of 'mine' for the aforesaid reason. [Para
24] [799-H; 800-A-C]
      2.3 If a new substance is brought into existence or if a new       E
or different article having a distinctive name, character or use
results from particular processes, such process or processes
would amount to manufacture. [Para 25) [800-C-D]
      Gramophone Co. of India Ltd. v. Collector of Customs,
      Calcutta 2000 (1) SCC 549; Aspinwall & Co. Ltd. v.                 F
      Commissioner of Income Tax, Ernakulam 2001 (2)
      Suppl. SCR 559 : 2001 (7) SCC 525; Servo-Med
      Industries Pvt. Ltd. v. Commissioner of Central Excise
      2015 (6) SCALE 137 - relied on.
                                                                         G
       2.4 The Ferromanganese Alloy so manufactured by the
appellant using the mineral Manganese at its Ferromanganese
plant is an entirely different product from its mineral raw material
both physically and even chemically. Moreover, unlike Manganese
ore a ferromanganese alloy can never be found in the natural state
                                                                         H
784          SUPREME COURT REPORTS                      f20161 11 S.C.R.


A and it has to be manufactured from the manganese ore and other
  minerals only. The same logic applies to copper concentrate as a
  different and distinct product comes into existence. Thus
  analyzed, in both the cases, the different products in commercial
  parlance have emerged. Hence, the principle of 11oscitur a sociis
B has to be applied. As a logical corollary, tariff has to be levied as
  meant for manufacturing unit. [Paras 30, 31] [804-A-C]
           State of MP v. Bir/a Jute Mfg. Co. Ltd. 199S (1)
           Suppl. SCR 271: 199S (4) SCC 603; Hindustan Copper
           Ltd. v. State of MP and others 2004 (12) SCC 408;
c          State of WB. v. Kesoram Industries Ltd. And others
           2004 (1) SCR S64 : 2004 (10) SCC 201; Uranium
           Corporation of India Ltd., Bihar v. Collector of
           Central Excise, Patna 198S (19) ELT 609; V. P.
           Pithupitchai and another v. Special Secretary to the
D          Govt. of TN. 2003 (3) SCR 104S : 2003 (9) SCC S34;
           Stone Crusher Owners Association and other v. MP
           Electricity Board and others MP No. 673/1993;
           Minerals and Metals Trading Corporation ofIndia Ltd.
           v. Union of India and others 1973 (1) SCR 997: 1972
 E         (2) SCC 620; East India Tobacco Co. v. State ofAndhra
           Pradesh 1962AIR1733 :1963 SCR 404; Elel Hotels
           and Investments Ltd. v. Union of India
           1990 AIR 1664 : 1989 (2) SCR 880 : 1989 (3) sec
           698 and Govt. of A.P v. P. Laxmi Devi 2008 (3)
           SCR 330: 2008 (4) SCC 720;Tarlochan Dev Sharma
 F
           v. State of Punjab & Ors. 2001 (3) SCR 1146 : 2001
           (6) SCC 260; Union of India v. Harjeet Singh
           Sandhu 2001 (2) SCR 1127 : 2001 (5) SCC S93 -
           referred to.

G          Principles of Statutory Interpretation - referred to.
                            Case Law Reference
      199S (1) Suppl. SCR 271       referred to             Paras
      2004 (12) sec 408             referred to             Paras
H 2004 (1) SCR S64                  referred to             Para 10
  MANGANESE ORE JNDIALTD v. STATE OF M.P. & ORS.                             785


1985 (19) ELT 609                referred to               Para 10            A
2003 (3) SCR 1045                referred to               ParalO
1973 (1) SCR 997                 referred to               Para 10
1963 SCR 404                     referred to               Para 11
1989 (2) SCR 880                 referred to               Para 11            B
2008 (3) SCR 330                 referred to               Para 11
2001 (3) SCR 1146                referred to               Parall
2001 (2) SCR 1127                referred to               Para 11
1990 (2) SCR 797                 relied on                 Para 18            c
2004 (1) SCR 470                 relied on                 Para18
2007 (8) SCR 136                 relied on                 Para 19
2006 (8) Suppl. SCR 790          relied on                 Para 19
2001 (2) Suppl. SCR 559           relied on                Para 19, 26        D
2000 (1) sec 549                  relied on                Para24
2015 (6) SCALE 137                relied on                Para27
     CJVJLAPPELLATE JURISDICTION : Civil Appeal No. 2464
of2016.
                                                                               E
     From the Judgment and OrderdatedOl .12.2011 ofthe High Coutt
ofMadhya Pradesh Principal Seat atJabalpur in Writ Petition No. 9017
of2010
      WITH
                                                                               F
      C.A. Nos. 2465-2467 of 2016.
     Mukul Rohatgi,AG, P. P. Rao, Sr.Adv., T. G Narayanan Nair,
Devashish Bharuka, K. N. Madhusoodhanan, Ravi Bharuka, R. K. Sanghi,
Ms. Nandini Sen, Deba Prasad Mukherjee, Advs. for the Appellant.
      Amalpushp Shroti, B. S. Banthia, Mishra Saurabh,Amit Kumar               G
Lal, Advs. for the Respondents.
      The Judgment of the Court was delivered by
      DIPAK MISRA, J. l. In this batch ofappeals, by special leave,
the appellants have assailed the legal tenability of separate orders dated    H
786             SUPREME COURT REPORTS                           [2016] II S.C.R.


A     01.12.2011 passed in Writ Petition No. 9017 of20 I 0 which relates to the
      writ petition filed by Manganese Ore India Ltd. and M.P. No. 2821 of
      1988, M.P. No. 3827of1993 and W.P. No. 3103of1994 preferred by
      Hindustan Copper Limited.
             2. As the commonality of controversy centres around
B     interpretation ofthe terms "mineral" and "processing" under the definition
      of"mine" as defined under Explanation (b) of Part-B of Madhya Pradesh
      Electricity Duty Act, 1949 (for brevity, "the Act"), we shall enumerate
      the scheme of the Act and the various litigations that have taken place
      and thereafter advert to the facts in each case. For brevity and to avoid
C     repetition, we have initially referred to the litigation and different orders
      passed in the case of Hindustan Copper Limited.
              3. The erstwhile Central Provinces and Berar Legislative
      Assembly had enacted the CP and Berar Electricity Duty Act, 1949
      which was adopted in the State of Madhya Pradesh and has come to be
D     known as the Madhya Pradesh Electricity Duty Act, 1949. The Preamble
      to the Act as amended by the State Legislature provides that it is an Act
      for the levy of duty on sale or consumption of electrical energy. Section
      3(1) of the Act accordingly provides for levy of duty on sale or
      consumption ofelectrical energy. It stipulates that subject to the exceptions
E     specified in Section 3-A, every distributor of electrical energy and every
      producer shall pay every month to the State Government at the prescribed
      time and in the prescribed manner a duty calculated at the rates specified
      in the table below on the units of electrical energy sold or supplied to a
      consumer or consumed by himself for his own purposes or for purposes
F     of his township or colony, during the preceding month. The table to
      Section 3(1) prescribes different rates of duty depending for the purpose
      for which the electrical energy is sold. Part-B of the table provides for
      different rates ofduty forthe electrical energy-sold, supplied or consumed
      for the purposes therein. Item 3 to the said table reads as follows:-
G              "3. Mines (other than captive          40
                   mines of cement industry)"
            4. The numeral 40 comes under the heading 'rate of duty as
      percentage of the electricity tariff per unit'. The Explanation (b) to
H     Section 3(1) defines "mine" as under:-
     MANGANESE ORE INDIA LTD v. STATE OF M.P. & ORS.                            787
                  [DIPAK MISRA, J.]

          "Explanation .-(b) "Mine" means a mine to which the Mines              A
          Act, 1952 (No. 35of1952) applies and includes the premises or
          machinery situated in or adjacent to mine and used for crushing,
          processing, treating or transporting the mineral."
       5. It is necessary to state here that Hindustan Copper Limited
had filed a Writ Petition to strike down the provision of Section 3 and the      8
Table Part-B Item 4 (which is now Item No. 3 after 1995 amendment)
and Explanation (b) which contains extended definition of mines as ultra
vires the Constitution. As the factual matrix would reveal, the High
Court dismissed the Writ Petition by placing reliance on State ofM.P. v.
Bir/a Jute Mfg. Co. Ltd. 1• The matter travelled to this Court which             c
eventually formed the subject matter of Civil Appeal Nos. 3248-50 of
1998. A two-Judge Bench of this Court in Hi11dusta11 Copper Ltd. v.
State of M.P. and others1 taking note of certain facts opined that the
main controversy that was required to be examined by the High Court
was as to how the word "mines" is to be understood as contained in               D
clause (b) of the Explanation under Item 4 of the Table contained in
Section 3 of the Act. This Court took note of the contentions of the
appellant therein that the activities carried on by it do not fall within the
meaning of the word "adjacent" area and further the approach of the
respondents was selective and discriminatory. As the submissions raised
                                                                                  E
were not dealt with by the High Court but it proceeded to dispose of the
case without examining the facts in greater details in regard to either the
activities carried on at different places by the appellant or as to how in
the context of the facts ofthe case and having due regard to the provisions,
the word "adjacent" should be construed, the Court remitted the Writ
                                                                                  F
Petition to the High Court by stating so:-
         "Under the circumstances, we consider it just and appropriate
         that the High Court should examine afresh the contentions
         advanced on behalfofthe parties, having due regard to the materials
         placed on record and in the context of the provisions of the Act
                                                                                 G
         touching the controversy. Since we are taking a view to remit the
         case to the High Court, we do not wish to express one way or the
         other on the merits of the respective contentions urged by the
         parties .... "
1
    (1995)4 sec 603
2
    (2004) 12 sec 4os                                                            H
788            SUPREME COURT REPORTS                             r2o 161 11 S.C.R.


A             6. After the remit, the High Court heard the Writ Petition and
      dismissed the same. The order passed by the High Court was assailed in
      appeal, !Jy special leave, in Civil Appeal No. 6725 of2008. In the second
      round, the two-Judge Bench stated the facts in detail which are to the
      effect that the appellant therein is engaged in extraction of copper ore,
B     by open cast mining process involving drilling and blasting the ore in the
      open pit mine, the.ore in the form of boulders are transported to the
      primary crusher (situated at a distance of2.53 km from the mine), where
      it is crushed into pebbles/pieces and such crushed ore is then carried on
      a conveyor to a secondary crusher (situated at about 5 km from the
      mine) for further crushing into smaller pebbles. After the said stage,
c
      small pieces/pebbks are then carried by a conveyor to the Concentrator
      Plant (situated at 5.5 km from the mine).
             7. This Court further proceeded to state the facts adumbrated
      as projected by the appellant before the High Court. It was asserted
D     that:-
              "4. In the Concentrator Plant, the ore is milled into powder in the
              ball mills. Such powder mixed with water is carried in the form
              of slurry to floatation cells. In the floatation cells, the slurry is
              subjected to froth floatation process and the copper concentrate
E             is removed and dried in vacuum driers and stored in concentrate
              storage sheds. The tailing pumps are at a distance of8 km. A
              large quantity of water is required for the Concentrator Plant for
              being used in milling. Water is also required for the factory
              township. The required water is pumped from the mines through
F             pumps located at an intake well (situated at a distance of l 0 km
              from the mine). From the intake well, water is pumped to water
              treatment plant (situated at a distance of6 km from the mine).
              5. According to the appellant, its activities consist of two distinct
              parts. First is mining, that is, drilling, blasting and collecting ofore
G             which is carried on at mine pit. This activity is carried on in the
              mine area registered under the Mines Act, I 952. The second is
              processing, which is carried on at the primary crusher, the
              secondary crusher and the Concentrator Plant. The processing
              (manufacturing) part ofthe activities are carried on in the factory
H             area. The primary crusher, the secondary crusher, the ball mill,
  MANGANESE ORE INDIA LTD v. STATE OF M.P. & ORS.                           789
               [DIPAK MISRA, J.]

       the Concentrator Plant, the tailing pumps, the intake well and the    A
       water treatment plant are situated away from the mine, at
       distances varying from 2.5 km to I 0 km and are registered
       separately as a "factory" under the provisions of the Factories
       Act, 1948. The open pit mine (mining area) and the processing
       plants/machineries (factmy area) are all situated in a large tract    B
       ofland taken on mining lease from the State Government."
       8. The two-Judge Bench adverted to the chronology of the case
and noted that the principal grievance of the appellant therein pertains to
the definition of"mine" the effect of which is to make processing a part
of mining and the prescription ofa higher rate of duty for "mines" (that c
is composite activity of mining and processing), while prescribing a lesser
rate for other categories of industries. That apart, the Court taking note
of the fact that classification of factories into two categories: (a) those
which are adjacent to a mine and used for crushing, processing, treating
and transporting the mineral; and (b) other factories is permissible. It D
 was urged on behalf of the appellant that the expression "adjacent to the
 mines" is vague and ambiguous that leads to discriminatory treatment by ,
the authorities. Further, its processing plant, that is, the primary crusher,
 the secondary crusher, the ball mill, the Concentrator Plant, the tailing
 pumps, the intake well and the water treatment plant are not situated E
 "adjacent" to its mine and therefore could not be treated as "mine" for
 the purpose oflevy of electricity duty. The Court also took note of the
 issues framed by the High Court after the order ofremit on the earlier
 occasion. The said issues read as follows:-
        "(i) Whether prescribing different rates of tax for processing        F
        plant and machinery adjacent to a mine ('factory' falling within
        the extended definition of 'mine'), and other factories is
        discriminatory and arbitrary and therefore violative ofArticles
        14 and 19 of the Constitution oflndia?
        (ii) Whether definition of the word 'mine' in Explanation (b) in      G
        the Table under Section 3 ofthe Act, gives unguided discretion to
        authority under the Act to decide what is 'adjacent to a mine'
        and therefore invalid.?
        (iii) Whether use of the words 'adjacent to a mine' would mean
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790            SUPREME COURT REPORTS                          [2016] 11 S.C.R.


A            only the premises or machinery abutting to or adjacent to the
             mine, and not premises or the plant/machinery situated at a
             distance of about 2.5 to 6 km?
             (iv) Whether the State had applied different yardsticks in charging
             duty to petitioner and in charging duty to Bhilai Steel, Balco,
 B           Manganese Ore India Ltd. and thereby practised discrimination?"
             9. It is imperative to state here that a contention was advanced
      by the appellant therein that the High Court had not considered the real
      issues and the questions formulated for determination did not cover the
      actual issues and disputes involved. The Cou11 proceeded to state the
c     controversy in followingterms:-
              "21. The Act was amended by the M.P. Electricity Duty
             (Amendment) Act, 1986 (in short "the Amendment Act").
             Different rates of duty are provided in Pa11 B. In the said Part,
D            clause (4) relates to the mines other than the captive mines of
             cement factory and the rate is 50 paise per unit of energy.
             Explanation (b) defines ;;mine" as follows:
               "(b) ;mine' means amine to which the Mines Act, 1952 (
               35of1952) applies and includes the premises or machinery
 E             situated in or adjacent to a mine and used for crushing,
               processing, treating or transporting the mineral."
             22. It was submitted that the entry relating to mines refers to
             processing, treating or transporting the mineral. According to the
             learned Solicitor General the stress is on the expression "mineral".
 F           It was pointed out that the appellant is manufacturing "copper
             concentrate" which is not a mineral and it is not doing "mining"
             so far as it is covered by clause (7) forother industries not covered
             under the above categories where the rate is 5 paise per unit of
             energy. Essentially the submission is that the Explanation only
 G           relates to mining or minerals. What is excisable is "copper
             concentrate" because there is a process of manufacturing
             involved. It is seen that Points (iii) and (iv) formulated by the
             High Court for determination are really relevant. But the points
             have not been correctly formulated to cover the actual essence
             of the dispute. The correct question would be as follows:
 H
     MANGANESE ORE INDIA LTD v. STATE OF M.P. & ORS.                            791
                  [DIPAK MISRA, J.]

            "Whether copper concentrate is a mineral and whether                 A
            Explanation to Part B of the Act applies even though
            manufacturing process is involved to bring it into existence?""
       In view ofthe aforesaid, this Court set aside the impugned judgment
and remanded the matter to the High Court for fresh consideration of
the question framed permitting the parties to place material in support of       B
their respective stands.
       I 0. After the remand, before the High Court it was contended
that mineral is something which grows in the mine and is capable of
being won or extracted so as to be subjected to the better or precious
use. It was further contended that copper ore is extracted at the mine
                                                                                 c
pit and then it is subjected to processing whereafter copper ore becomes
copper concentrate which is a different commodity which is an excisable
product. On that basis, it was urged that copper concentrate is not a
"mineral" and consequently, Explanation (b) to Part-B of Section 3 of
the Act will notapply. Reliance was placed on State ofW.B. y. Kesoram            D
Industries Ltd. and others3 and Uranium Corporation ofIndia Ltd.,
Bihar v. Collector ofCentral Excise, Patna4 • On behalf of the State,
it was urged that copper concentrate is a "mineral" regard being had to
the definition contained in Section 2(jj) ofthe Mines Act, 1952 (for short,
"the 1952 Act") as well as Schedules I and II appended to the Mines and          E
Minerals (Development and Regulation) Act, 1957. The Division Bench
was commended to the authority in V.P. Pithupitchai and another v.
Special Secretary to the Govt. of T.N. 5 and the decision of the Division
Bench of the High Court in Stone Crusher Owners Association and
other v. M.P. Electricity Board and others6• On behalf of the                    F
respondents, the competent authority of the M.P. Electricity Board
contended that the copper ore does not cease to be a "mineral" merely
because it is subjected to the stated processing and therefore the copper
concentrate does not lose its identity as a mineral. It was further submitted
that even though the copper ore is subjected to processing yet its chemical
                                                                                 G
structure does not change by placing reliance on the decision in Minerals

'(2004) 10 SCC201
' 1985 (19) ELT 609
'(2003) 9 sec 534
6
    MP No. 673/1993
                                                                                 H
792                SUPREME COURT REPORTS                    [2016] II S.C.R.


A     and Metals Trading C01poratio11 ofIndia Ltd. v. Union ofI11dia and
      others 7•
          11. The High Cou1t considering the rivalised submissions at the
  Bar, came to hold that the State has the authority to pick and choose
  districts, objects, persons, methods and even rates for taxation ifit does
B so reasonably and for the said purpose placed reliance on East India
  Tobacco Co. v. State ofAndhra Pradesh 8• It further opined that while
  latitude is available to the legislature in the matters of classification of
  objects, persons and things for purposes of taxation and it has to be so
  havingregard to the complexities involved in the formulation of taxation
c policy. To express the said opinion, the High Court placed reliance on
  Elel Hotels am! Investments Ltd. 11. Union oflndia 9 and Govt. ofA.P.
  v. P. Laxmi Devi 10 • Thereafter it referred to subject-and-object rule
  and in that regard reproduced a passage from Principles ofStatutory
  Interpretation 11 and commended itself to the authorities in Tarloclum
D Dev Sharma v. State ofPunjab & Ors. 11 and Union ofIndia v. llarjeet
  Singh Sandhu 13 • After stating the legal proposition in the aforesaid
  manner, the High Court ruled that the 1949 Act is an enactment meant to
  provide for levy of duty on sale or consumption of electrical energy and
  the Act has been enacted in exercise of power under item 48 (b) List II
E ofthe Government oflndiaAct, 1953 which corresponds to Entry 53 of
  List II of the Vllth Schedule of the Constitution oflndia, namely, tax on
  consumption or sale of electricity. It referred to Section 3 of the Act and
  the definition of the term 'mine' and deduced that electricity duty under
  the Act is a tax which is levied on sale of consumption of electricity and
  fu1ther proceeded to state that if the table appended to Section 3 of the
F
  Act is seen, the classification for the purpose oflevy of electricity duty is
  based on the purpose for which the electrical energy is sold or consumed
  and the classification table for the purpose oflevy of duty. Dealing with
  the facet of classification, the High Court observed that:-

 G
               "The classification made under Section 3 of the Act has a clear
      1 (1972) 2   sec 620
      8
         AIR 1962 SC 1733
      9
         (1989) 3 sec 698 =AIR 1990 SC 1664
      10 (2008) 4 sec 120
      11
          Justice GP. Singh, 12th Edn .. Page 349-350
      12
          (2001 l 6 sec 260
H     " (2001) 5 sec 593
  MANGANESE ORE.INDIA LTD v. STATE OF M.P. & ORS.                               793
               [DIPAK MISRA, J.]

        nexus with the object sought to be achieved, namely, raising             A
        revenue by grouping different types ofindustries and prescribing
        different rates of duty depending upon the nature of the industry.
        The highest rate of electricity duty is prescribed by the legislature
        in its wisdom for the mining industry. The object of prescribing
        the highest rate of electricity duty appears to tax the person/          B
        industry exploiting the nature wealth which is non-renewable.
        The exploiter has been required to contribute more, so that such
        contribution is, hopefully, utilized forthe welfare of the people to
        whim such natural wealth belongs".
        12. After so stating, it adverted to the anatomy of the definition       c
of the term 'mine' and observed that the expression creates a legal fiction
and, therefore, the definition will embrace only what is comprised within
the ordinary meaning of'mine' part, together with what is mentioned in
the inclusive part ofthe definition and, therefore, as per well settled rules
of statutory interpretation has to be read with regard to subject and object     D
of the Act. The Court proceeded to state that the object of the Act is to
raise revenue by prescribing rate of duty and the highest rate of duty is
prescribed for mining industries as it is exploiting the natural wealth which
is non-renewable, therefore, it must pay higher rate of duty which can be
utilized for meeting the essential expenditures by the State Government.         E
Thereafter, the High Court held:-
        "Taking into account the fact that the expression 'mine' creates
        a legal fiction and ifthe word 'mineral' is read subject to the
        context and object of the Act, it is graphically clear that wide
        meaning has to be given to expression 'mineral'. If the copper            F
        ore is converted to copper concentrate by processing, it only
        enriches content of copper in the copper concentrate and it does
        not cease to be 'mineral' merely on its conversion from copper
        to copper concentrate.
        In view of the preceding analysis, in our considered opinion             G
        copper concentrate is a mineral as defined in explanation (b) to
        Part B of Section 3 of the Act and, therefore, the explanation (b)
        to Part B of Section 3 of the Act applies to it.
        Besides "copper concentrate: is the end product. What is
                                                                                 H
794            SUPREME COURT REPORTS                         [2016] 11 S.C.R.



A             'crushed, processed, treated or transported' is not copper
              concentrate' but the ore. The electricity in question is being
              consumed for such "crushing, processing, treating or
              transportation"."
             13. Dwelling upon the word "adjacent" and the argument raised
B     pertaining to discrimination between industries located in close proximity
      ofthe mine and other industries carrying on the same activity, namely,
      'crushing, processing, treating or transportation', which are not located
      in such close proximity of the mine, the Division Bench opined that:-
              "The word 'adjacent' does not mean 'adjoining' or 'abutting',
c             but has a wider connotation, and would include close proximity
              such being in the same locality. This proposition is not disputed,
              and therefore, it is not necessary to refer to the case law cited
              for the meaning of the word 'adjacent'. fn reply the learned
              Additional Advocate General submits that this differentiation is
D             justified because the increased overheads such as transportation
              costs have been considered for not subjecting the far away
              industries to higher tax".
              14. When the matter was listed for hearing, Mr. Mukul Rohtagi,
      learned Attorney General appearing for the Manganese Ore India Ltd.
 E
      and Mr. P.P. Rao, learned senior counsel appearing for Hindustan Copper
      Ltd. urged that the High Court has fallen into grave error by imposing
      the electricity duty on the basis of the definition engrafted under
      Explanation (b) to Section 3(1) of the 1949 Act. It was contended by
      Mr. Rohtagi that manganese ore is a mineral under the Mines Act, 1952
F     but ferro manganese is not a mineral because the said mineral is converted
      into "alloy" and ceases to be a mineral. Mr. P.P. Rao, learned senior
      counsel submitted that copper is a mineral but copper concentrate does
      not contain any character of a mineral and, therefore, the duty has to be
      charged at the rate of 8% and not at the rate of 40%.
G
             15. Mr. Saurabh, learned counsel for the State, per contra,
      contended that the definition is an inclusive one and hence, when the
      mineral is processed for the purpose of conversion to alloy, duty at the
      rate of 40% is leviable. Learned counsel for the State would submitthat
      the view expressed by the High Court is absolutely defensible.
H
  MANGANESE ORE INDIA LTD v. STATE OF M.P. & ORS.                              795
               [DIPAK MISRA, J.]

        16. The thrust of the matter is whether the aforesaid activity          A
after the mineral i.e. ore has been mined would be covered by the word
'processing' used in the Explanation B to Item 3( I) which defines the
term 'mine'. Mine as per the said explanation means a mine as to which
the Mines Act, 1952 applies. The word "mine" as defined in the Mines
Act, 1952 reads as follows:-                                                    B
          "U) "mine" means any excavation where any operation for the
          purpose of searching for or obtaining minerals has been carried
          on, and includes
          (i-iv) .....
                                                                                c
          (v)    all conveyors or aerial ropeways provided for the bringing
          into or removal from a mine of minerals or other articles or for
          the removal of refuse therefrom;
          (vi) all adits, levels, machinery, railways, tramways and sidings
          in or adjacent to and belonging to a mine;                            D
          (vii) all protective works being carried on in or adjacent to
          the mine;"
        17. The word 'minerals' as defined in the Mines Act, 1952 reads
as follows:                                                                      E
        "(ii)"minerals" mean all substances which can be obtained from
        the earth by mining, digging, drilling, dredging, hydraulicking,
        quarrying or by any other operation and includes mineral oils
        (which in tum include natural gas and petroleum)".
        18. Mining would comprehend every activity by which the mineral          F
is extracted or obtained from earth irrespective of whether such activity
is carried on at the surface or in the bowel, but it must be an activity for
winning a mineral. For the purpose ofltem 3 'mine' to which electrical
energy is sold, supplied or consumed, it would include machinery or
premises situated in the adjacent to the mine, provided the electricity is      G
used for crushing, processing, treating or transporting the minerals. The
word 'mineral' used in the aforesaid Explanation under the Act would
have reference to the mineral which is mined and is then crushed,
processed, treated or transported. The word 'processing' used in the
Explanation has to be interpreted in the context and for the purpose of         H
796            SUPREME COURT REPORTS                         r20l6l 1 l S.C.R.



A     the said item. Process can be given either a wide or a narrow meaning.
      In the context in which it is used in the Explanation, we are disposed to
      think that it must be given a meaning which emerges when we apply the
      rule of noscitur a sociis which means that the meaning of the word is to
      be judged by the company it keeps. [See: Ro/tit Pulp alld Paper Mills
B     Ltd. v. Collector of Celltral Excise'•]. The rule of noscitur a sociis
      has been applied and accepted in Altmedabad Pvt. Primary Teachers'
      Associatio11 v. Admillistrative O.ffecer & Ors. 15 We would prefer to
      construe the said word in the Explanation with reference to the words
      before and after for the word 'processing' used therein. The word
      'processing' herein, we think, should be interpreted and understood with
c
      the associated words 'crushing' and 'treating'. The word 'processing'
      is susceptible of the meaning keeping in view the word 'crushing' and
      'treatment' used before and afterwards.
             19. We are absolutely conscious that noscitur a sociis rule is
D     not applied when the language is clear and there is no ambiguity, which
      according to us does exist and perceptible in the Explanation in question.
      A very broad and a wide definition of the term 'processing' ifapplied,
      would include manufacture ofa new or distinct product. Manufacture
      normally involves a series of processes either by hand or machine. [fa
 E    restricted construction is not applied it would create and give rise to
      unacceptable consequences. It is not the intent to treat and regard
      manufacturing activities as processing. Manufacturing, as is understood,
      means a series of processes through different stages in which the raw
      material is subjected to change by different operations. [For different
      between process and manufacturing see C/Tv. TaraAgellcy 16 , Oriellt
 F
      Paper alld Industries v. State of M.P. a11d Anr. 17 and Aspinwall &
      Co. Ltd. v. Commissioner ofIncome Tax, Emakulam 18 .]
             20. The words' crushing', 'treating' and 'transporting' are words
      of narrower significance and the word' processing' used between these
 G    words should not be given a very wide meaning, for the legislative intent,
      according to us, is narrower. The word. 'processing' would take its
      "(1990) 3 sec 447
      "(2004) 1 sec 755
      " (2007) 6 sec 429
      11
         (2006) 12 sec 468
H     "(2001) 1sec525
   MANGANESE ORE INDIA LTD v. STATE OF M.P. & ORS.                              797
                [DIPAK MISRA, J.]

meaning in the cognate sense. In other words, the general word                   A
'processing' will be restricted to the sense conveyed by the words
'crushing', 'treating' and 'transporting'. The intent being that electricity
tariff payable in respect of mining activities would include the mine itself,
all machinery situated or located in the mine or in a premises adjacent to
the mine wherein crushing, processing, treatment or transportation of            B
the minerals as mined is undertaken. The word 'processing' herein would
mean those processes with the help of hands or machineries connected
and linked to mining activity. It would not include process by which a
new or different article other than the one which has been mined, is
produced. It relates and signifies the composite activity of mining and          c
processing. The intent is not to include processes which would lead to
creation of a different commodity as known in the commercial world for
otherwise even manufacturing activity would get covered, whereas
manufacturing unit is liable to pay electricity tariff at a lower rate. The
 intent and purpose is certainly not to compel and force a manufacturing
                                                                                 D
 unit being set up at an acceptable distance from the mine, for the
 manufacturing unit adjacent to the mine would have to pay electricity
tariff at a higher rate. Pertinently, a manufacturing unit set up by another
 entity, whether adjacent to the mine or not, would pay a lower tariff.
 Such absurdity and irrationality has to be avoided. In the present context,
 we would, therefore, hold 'processing' would mean activities in order to         E
 make the mineral mined marketable, saleable and transportable, without
 substantially changing the identity of the mineral, as mined. When there
 is a substantial change at the mineral mined and the process results in a
 different commodity being produced or transforming and completely
 changing the mineral, it would fall outside the scope of the word                F
 'processing'. The restricted construction will also be acceptable in view
 of the use of the word 'mineral' in the end ofthe Explanation. The word
 'mineral' in the Explanation is the product which was mined and is put to
 'crushing', 'processing', 'treatment' and 'transporting' the mineral. In
 other words, mineral means mineral which was mined and not a new                G
 product created by using or processing the mineral mined.
       2 I. Be it noted, learned counsel forthe appellants would submit
that the metals and minerals available in the earth are rarely found in the
pure forms and degree of purity that the ultimate users demand. They
                                                                                 H
798             SUPREME COURT REPORTS                         [2016] 11 S.C.R.


A     are intimately mixed, physically or chemically and often both, with other
      substances. For use, the good must be separated from the worthless
      substances. The sum total of the treatments to which the ores are
      subjected to in orderto separate and discard their worthless fractions by
      essentially physical means is called "Ore Dressing''. The various modes
B     ofOre Dressing include handpicking, smting, screening, washing, jigging,
      magnetic separation, crushing, grinding, etc. In this process, there is no
      change in the chemical composition and properties of mined mineral,
      before and after processing/dressing to make it saleable. It is important
      to point out that mineral/dressing is a subject matter of Mineral
c     processing.
              22. As distinguished from the above, manufacturing of an alloy,
      etc. is a subject matter of Metallurgy and is a part of Metallurgical branch
      ofengineering. Ore Dressing is defined as the processing of raw mineral
      to yield a marketable mineral by such means that do not destroy the
D     chemical identity of the minerals. On the other hand, an alloy like the
      Ferro Manganese Alloy is a result of a manufacturing method which
      involves Electro thermic smelting in case ofthe appellant which ultimately
      changes the chemical identity of manganese ore resulting into
      ferromanganese alloy. This method requires manganese ore as one of
 E    the raw materials for the manufacture of Ferro Manganese Alloy. Ferro
      Alloy is defined as an alloy of iron with a sufficient amount of some
      element or element such as manganese, silicon, chromium or vanadium
      as a means ofintroducing these elements into iron and steel. Customarily,
      Ferro alloys are identified or designated by the principal base metals
      present in them. The names of Ferro alloys are abbreviated by using
 F
      chemical symbols, e.g., FeMn, FeSi and FeCr standing for Ferro
      Manganese, Ferro Silicon and Ferro Chromium, respectively.
      Manufacturing of Ferro manganese alloy involves the use of manganese
      ore as a raw material which is subjected along with other raw material
      (Dolomite, Iron Ore, Coke, Coal and Carbon Paste), to Electro thermic
 G    smelting. The manufacturing of Ferro Manganese by Electro thermic
      smelting is a continuous smelting with the electrodes submerged deep
      into the charge. The smelting includes the stages as follows: pre-heating
      ofthe materials, drying and removal ofvolatiles, reduction ofoxides, and
      smelting of the metal and slag. The same reasoning and manufacturing
H
  MANGANESE ORE INDIA LTD v. STATE OF M.P. & ORS.                             799
               [DIPAK MlSRA, J .)

processing is required to create copper concentrate, a new and different       A
commercial product. lt is not the mineral as mined.
       23. It is urged that Ferromanganese is an alloy and is not a
mineral. The same is an alloy of manganese and iron and is not available
in natural form. It is manufactured in the ferromanganese plant of the
appellant- Manganese Ore India Ltd. by using raw materials LIKE                B
manganese ore, iron, coal, coke, dolomite, etc. It is further contended
that the appellant, Manganese Ore India Ltd. has, within its manganese
ore mine area, an Integrated Manganese Beneficiation Plant (IMB Plant)
as also a Ferro Manganese Plant (FMP). Following is the seriatim in
which the mining/processing/manufacturing takes place:-                        c
a. First Stage : The appellant mines manganese ore from its mines. There
is a levy of electricity duty on the appellant's consumption of electricity
during mining at 40%, which the appellant is not disputing.
b. Second State: Such mines manganese ore is processed by removal of           D
impurities in the appellant's Integrated Manganese Beneficiation Plant
(IMB Plant). During this process the cleaning of mineral takes place by
various methods to remove impurities and foreign contents for the
enrichment of the manganese content and during this process, the
manganese mineral remains a mineral. There is a levy of electricity duty
                                                                               E
on the appellant's consumption of electricity ofIMB Plant at 40%, which
the appellant is not disputing. It is relevant to note that 95% to 98% of
such processed manganese ore is sold in open market. Remaining is
then sent as a raw material to the appellant's Ferro Manganese Plant
(FMP).
                                                                               F
c. Third State: At the Ferro Manganese Plant, raw materials like,
processed manganese ore (for which 40% electricity duty is already
paid by IMB Plant), iron ore, coke, dolomite, coal, carbon, etc., are by
way of a manufacturing process through a furnace, blended into a
completely new product commercially known and sold in the market as
                                                                               G
ferromanganese alloy which is a different product with different chemistry
and, through smelting in furnace. This is nothing but a manufacturing
activity, where raw materials like manganese ore, iron ore, coke, dolomite,
coal, carbon, etc are completely consumed/exhausted.
       24. To bring to the Ferro Manganese Plant ofthe appellant within        H
800            SUPREME COURT REPORTS                          r1016] 11 S.C.R.


A     the meaning of'mine', the State has argued before this Court that the
      Ferro Manganese Plant is being "used for crushing, processing, treating
      or transporting" the mineral, that is, manganese ore. This is clearly
      unsustainable as the appellant is neither crushing or processing or treating
      or transporting manganese ore but rather using it as one of the raw
B     materials and consuming the same while manufacturing fetrnmanganese
      alloy. The state of crushing, treating, processing, etc. of the manganese
      ore (mineral) was in the !MB Plant (second stage), where the appellant
      is paying electricity duty at 40%. The same rate cannot be applied in the
      Ferro Manganese Plant (the third stage) as it cannot be taken to be
c     within the meaning of'mine' forthe aforesaid reason.
            25. Learned counsel for the appellants would contend that in
      numerous decisions, this Cout1 has reiterated that if a new substance is
      brought into existence or ifa new or different article having a distinctive
      name, character or use results from particular processes, such process
D     or processes would amount to manufacture. In the case of Gramopl1011e
      Co. ofIndia Ltd. v. Collector ofCustoms, Ca/cutta 19 , this Court held:-
              " 11. The term "manufacture" is not defined in the Customs Act.
              In the allied Act, namely the Central Excise Act, 1944 also, the
              term "manufacture" is not to be found defined though vide clause
 E            (f) of Section 2 an inclusive definition is given of the term
              "manufacture" so as to include certain processes also therein.
              12. "Manufacture" came up for the consideration of the
              Constitution Bench in Ujagar Prints v. Union ofIndia (J 989)
              3 sec 488. lt was held that if there should come into existence
 F            a new article with a distinctive character and use, as a result of
              the processing, the essential condition justifying manufacture of
              goods is satisfied. The following passage in the Permanent Edition
              of Words and Phrases was referred to with approval in Delhi
              Cloth and General Mills, AIR 1963 SC 791 at p. 795:
 G
                "'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
      •• (2000) i sec 549
 H
  MANGANESE ORE INDIA LTD v. STATE OF M.P. & ORS.                            801
               [DIPAK MISRA, J.]

        article must emerge having a distinctive name, character or           A
        use."
      13. In a series of decisions [to wit, Decorative Laminates (India)
      (P) Ltd v. CCE, (!996) JO SCC 46, Union of India v. Parle
      Products (P) Ltd. 1994 Supp. (3) SCC 662, Laminated
      Packings (P) Ltd v. CCE, (!990) 4 SCC 51 and Empire                     B
      Industries Ltd. v. CCE, (!985) 3 SCC 314] the view taken
      consistently by this Court is that the moment there is
      transformation into a new commodity commercially known as a
      distinct and separate commodity having its own character, use
      and name whether it be the result of one process or several             c
      processes, manufacture takes place; the transformation of the
      goods into a new and different article should be such that in the
      commercial world it is known as another and different article.
      Pre-recorded audio cassettes are certainly goods known in the
      market as distinct and different from blank audio cassettes. The         D
      two have different uses. A pre-recorded audio cassette is generally
      sold by reference to its name or title which is suggestive of the
      contents of the audio recording on the cassette. The appellant is
       indulging in a mass production of such pre-recorded audio
      cassettes. It is a manufacturing activity. The appellant's activity      E
      cannot be compared with a person sitting in the market extending
      the facility of recording any demanded music or sounds on a
      blank audio cassette brought by or made available to the customer,
      which activity may be called a service. The Tribunal was not
       right in equating the appellant's activity with photoprocessing and
                                                                               F
      holding the appellant a service industry."
       26. In Aspinwall & Co. Ltd. (supra) this Court has held as
follows:-
       " 13. The word "manufacture" has not been defined in the Act.
       In the absence ofa definition of the word "manufacture" it has          G
       to be given a meaning as is understood in common parlance. It is
       to be understood as meaning the production ofarticles for use
       from raw or prepared materials by giving such materials new
       forms, qualities or combinations whether by hand labour or
                                                                               H
802    SUPREME COURT REPORTS                          [2016] 11 S.C.R.


A     machines. If the change made in the article results in a new and
      different article then it would amount to a manufacturing activity.
      14. This Court while determining as to what would amount to a
      manufacturing activity, held in CSTv. Pio Food Packers, 1980
      Supp. SCC 174 : that the test for determination. whether
 B    manufacture can be said to have taken place is whether the
      commodity which is subjected to the process of manufacture
      can no longer be regarded as the original commodity, but is
      recognized in the trade as a new and distinct commodity. It was
      observed: (SCC p. 176, para 5)
c       "Commonly manufacture is the end result of one or more
        processes through which the original commodity is made to
        pass. The nature and extent of processing may vary from one
        case to another, and indeed there may be several stages of
        processing and perhaps a different kind of processing at each
D       stage. With each process suffered, the original commodity
        experiences a change. But it is only when the change, or a
        series of changes, take the commodity to the point where
        commercially it can no longer be regarded as the original
        commodity but instead is recognized as a new and distinct article
 E      that a manufacture can be said to take place."
      15. Adverting to facts of the present case, the assessee after
      plucking or receiving the raw coffee berries makes it undergo
      nine processes to give it the shape of coffee beans. The net
      product is absolutely different and separate from the input. The
F     change made in the article results in a new and different article
      which is recognized in the trade as a new and distinct commodity.
      The coffee beans have an independent identity distinct from the
      raw material from which it was manufactured. A distinct change
      comes about in the finished product.
G
      16. Submission ofthe learned counsel for the Revenue that the
      assessee was doing only the processing work and was not involved
      in the manufacture and production of a new article cannot be
      accepted. The process is a manufacturing process when it brings
      out a complete transformation in the original article so as to
H
     MANGANESE ORE INDIA LTD v. STATE OF M.P. & ORS.                           803
                  [DIPAK MISRA, J.]

          produce a commercially different article or commodity. That           A
          process itself may consist of several processes. The different
          processes are integrally connected which results in the production
          of a commercially different article. !fa commercially different
          article or commodity results afl:er processing then it would be a
          manufacturing activity. The assessee after processing the raw         B
          betTies conve1is them into coffee beans which is a commercially
          different commodity. Conversion of the raw berry into coffee
          beans would be a manufacturing activity."
    27. This Court in Servo-Med Industries Pvt. Ltd. v.
Commissioner ofCentral 1:..xcise111 has held as under:-                         c
          "27 .(J) Where the goods remain exactly the same even after a
          particular process, there is obviously no manufacture involved.
          Processes which remove foreign matter from goods complete in
          themselves and/or processes which clean goods that are complete
          in themselves fall within this category."                             D
          "27 .(./) Where the goods are transfonned into goods which are
          different and/or new after a particular process, such goods being
          marketable as such. It is in this category that manufacture of
          goods can be said to take place."
                                                                                 E
      28. Thus, the Ferro Manganese Plant, being a unit involved in
manufacturing offerromanganese alloy as opposed to a unit involved in
crushing, treating, processing, etc. of manganese ore, cannot be treated
within the extended definition of'mine' within the Explanation (b) of
Part B ofTable of Rates of Duty to Section 3(1) of the Act.                      F
      29. The Executive Engineer and Chief Electrical Inspector,
Government of Madhya Pradesh, vide its letter dated 06.02.2005 to the
Superintendent Engineer and Deputy Electrical Inspector, Government
of Madhya Pradesh, had confirmed as under:-
           "On spot inspection it is confirmed that, Ferro Manganese Plant      G
           does not come in the Mining Area and Electricity Duty@ 8%
           being charged at present by the M.P. State Electricity Board is
           proper."
20
     2015 (6) SCALE 137
                                                                                H
804                SUPREME COURT REPORTS                      (2016] 11 S.C.R.



A            30. The Ferromanganese Alloy so manufactured by the appellant
      using the mineral Manganese at its Ferromanganese plant is an entirely
      different product from its mineral raw material both physically and even
      chemically. Moreover, unlike Manganese ore a ferromanganese alloy
      can never be found in the natural state and it has to be manufactured
 B    from the manganese ore and other minerals only. The same logic applies
      to copper concentrate as a different and distinct product comes into
      existence.
             31. Thus analyzed, we find that in both the cases, the different
      products in commercial parlance have emerged. Hence, we are inclined
C     to think that the principle of noscitur a sociis has to be applied. As a
      logical corollary, tariff has to be levied as meant for manufacturing unit.
      Therefore, the analysis made by the High Court is not correct and,
      accordingly, the judgments rendered by it deserve to be set aside and we
      so direct. However, during this period if any amount has been paid by
D     the appellants to the revenue, the same shall be adjusted towards future
      demands.
            32. Consequently, appeals are allowed. In the facts and
      circumstances of the case, there shall be no order as to costs.

 E
      Ankit Gyan                                                   Appeals allowed.