dissenting.
I am constrained to dissent in this case because the majority, by expanding, beyond its outer limits, the definition of the word “processing,” as used in the statute, have made every freezing and cold storage warehouse in the State of Tennessee a potential manufacturer as defined in T.C.A. § 67-6-206(b)(2). To accomplish this feat they have overruled the Department of Revenue of the State of Tennessee, an Administrative Law Judge and the Chancery Court of Davidson County, the next succeeding agency in the line of ascension for appellate review.
The provision of T.C.A. § 67-6-206 which has resulted in this controversy is the imposition of a reduced tax rate with respect to water, gas, electricity, fuel oil, coal and other energy fuels when sold to or used by manufacturers. The statute defines a manufacturer as one whose principle business is fabricating or processing tangible personal property for resale.
The majority opinion isolates a number of decisions from sister states which recognize “that changing the condition of raw foods is processing.” It then cites the case of Fischer Artificial Ice & Coal Storage Co. v. Iowa State Tax Commission, 248 Iowa 497, 81 N.W.2d 437, 441 (1957), for the conclusion that “there is a close analogy between applying heat to food stuffs in order to sterilize and preserve them and subjecting food to below zero temperatures for several days for a similar purpose. Freezing appears to be clearly processing as cooking does.” The majority also cites Woods v. General Oils, Inc., 558 S.W.2d 433, 436 (Tenn.1977), for the premise that this Court has recognized the distinction between “processing” and material handling or storage. There is no relationship between the issues in that case and the one before us.
Based on the definitions cited in the majority opinion the Court holds that “the initial blast freezing, together with the maintenance of that frozen condition and the handling and special services related to the blast frozen products constitutes ‘processing’ within the meaning of [T.C.A. *910§ 67-6-206], while the mere preservation of the pre-frozen condition and the handling and special services related to those products do not constitute ‘processing.’
“Processing, then, at the Humboldt Plant produces more than fifty-one percent (51%) of that plant’s total revenue, while processing at the Jackson plant produces less than fifty-one percent (51%) of the revenue. The result is that the Humboldt Plant qualifies for the reduced rate but the Jackson plant does not.”
The distinction between the maintenance in a frozen condition of products blast frozen by Beare Company for its customers and the preservation of pre-frozen products stored in its holding freezers escapes me.
What the majority opinion overlooks is the testimony of the President of Beare Company to the effect that the principal customers at the Humboldt Plant have a wide variety of prepared frozen food such as TV Dinners, Entrees, Pies, Mexican Food, Chinese Food, etc. Reelfoot Packing Company is a producer of pork products, pork chops, ribs, spareribs, bologna, sausage, bacon, this type of product. The produce Beare blast freezes is beef and pork. After it is blast frozen it is either shipped out or placed in the holding room according to the instructions of the customers. The administrative judge inquired from Mr. Beare, “For example, your relationship to Reelfoot at the present time, are you primarily storing their processed product on the way to distribution within the retail outlets, or are you acting as some process (sic) in their receipt and then ultimate processing of their food?” He responded, “What we do is, everything that we receive from them is fresh, and then we freeze it for them. Their business is divided up into two (2) categories called commercial, which goes to institutions or grocery stores, and then the other part is Army, which goes for the commissaries in the United States as well as Europe.” As a general rule, 25% of the merchandise would go back to the packing company, and 75% would go on to customers.
The problem with the conclusion of the majority is that Reelfoot Packing Co., the real manufacturer, is also a processor, governed by the Tennessee Meat and Poultry Inspection Act. T.C.A. § 53-7-202(23) defines a “processor” as a person who engages for profit in this State in the business of packing or packaging carcasses, meat, meat food or meat by-products, or poultry or poultry products, for human consumption or a person engaged for profit in the business of curing, salting, processing or other preparing of carcasses, meat, meat food products or meat by-products for human consumption.
In Chattanooga Plow Co. v. Hayes, 125 Tenn. (17 Cates) 148, 156, 140 S.W. 1068 (1911), the Court defined a manufacturer as follows:
“A manufacturer is one engaged in making materials, raw or partly finished, into wares suitable for use. The marked distinction between a manufacturer and a merchant is that the merchant, or dealer, sells to earn a profit, and the manufacturer sells to take profit already earned. He must buy the materials out of which to make his finished product, and he must sell the product of his factory after it is finished. But such dealings are not his occupation. The one supplies him with the materials with which to pursue it, while the other merely enables him to take the profit earned.” (Citations omitted).
Chattanooga Plow, supra, was cited with favor in Neuhoff Packing Co. v. Vernon Sharpe, et al, 146 Tenn. 293, 240 S.W. 1101 (1921), in which this Court held that where a packing house operation in which the business of the company was “the buying and slaughtering of livestock and the buying of meats for curing, rehandling, packing and manufacturing into all forms known to commerce,” there was no doubt that the occupation was as a manufacturer.
In Neuhoff, supra, this Court also approved the reasoning of the trial court in Engle v. Sohn & Co., 41 Ohio St., 691, 52 Am.Rep., 103, which included that State’s statutory definition of a manufacturer:
“Every person who shall purchase, receive, or hold personal property of any description, for the purpose of adding to the value thereof by any process of manufacturing, refining, rectifying, or by the *911combination of different materials, with a view of making a gain or profits by so doing, shall be held to be a manufactur-
The Beare Company neither owned nor sold the produce it earnestly insists it processed. Its business was selling a service, in this case, to various manufacturers who required the need of that service to complete the marketability of their products. The Company’s revenues derived from its charges for its various services and were not the result of a gain in the value of its customers products by virtue of the processing service which it rendered. See United Biscuit Company v. Stokes, 174 Tenn. 111, 124 S.W.2d 230 (1939). In this case all of the Beare Company’s customers were wholesalers whose principle business was the fabrication or processing of tangible personal property for resale at retail by their customers.
Even though “manufacturer” has popular meaning, all persons who can be said to manufacture an article are not to be classed as “manufacturer” regardless of circumstances, and everyone who manufactures is not embraced within the legal meaning of the term, but rather only those who manufacture articles of trade as the principal part of their business. A manufacturer makes to sell, and depends for his profit on the labor which he bestows on the raw material. He stands between the original producer and the dealer, or first consumer. C.J.S., Yol. 55, Manufacturers, p. 673.
If anything further need be noted it is that T.C.A. § 67-6-206 is part and parcel of the “Retailers Sales Tax Act,” T.C.A. § 67-6-101, et seq., and has nothing to do with the freezing, storing and wholesale distribution of the products of the Beare Company’s customers. This case is not to be compared with the situation in Tennessee Farmers Co-Op v. State, 736 S.W.2d 87 (Tenn.1987), in which the Co-Op was engaged in the business of manufacturing goods to be sold in its own retail outlets.