TMI Blog1963 (5) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... Commercial Tax Officer, Coimbatore III, on checking the accounts found the turnover under jewels to be Rs. 1,35,631-76 nP. and under first sales of bullion to be Rs. 97,294-16 nP. During the enquiry the petitioners' authorised agent represented to the assessing authority that the bullion sold by the firm was a mixture of gold and copper. Thereupon the Deputy Commercial Tax Officer came to the conclusion that the commodity sold was not "bullion", that the assessees are not entitled to the benefit of the concessional rate of 1/2 per cent. on the first sale of bullion and that they are liable to pay tax at 2 per cent. on the sales turnover under bullion. In support of his conclusion he cited the decision of the Andhra Pradesh High Court in Akh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n its uncoined state". There is an explanatory note which states that kora gold represents parts of jewels which cannot be used as jewels without re-making and therefore it should be treated as bullion. In Earl Jowitt's Dictionary of English Law, bullion is defined as "uncoined gold and silver in the mass" and it is stated "these metals are called so, either when smelted from the native ore and not perfectly refined, or when they are perfectly refined, but melted down into bars or ingots or into any unwrought body of any degree of fineness." In Chambers' Technical Dictionary, bullion is defined as (1) [1960] 11 S.T.C. 483. gold or silver in bulk, that is, as produced at the refineries or not in the form of coin. In Encyclopaedia Britannica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India (Amendment) Rules, 1963, gold is defined as meaning "gold, including its alloy, whether virgin melted, remelted, wrought or unwrought, in any shape or form of a purity of not less than nine carats............" Therefore, it is clear that bullion does not refer to 100% pure gold or pure silver: it may be gold or silver mixed with copper and other metals. The assessees are dealers in gold jewels. They also sell gold to their customers for manufacture of jewels. The gold which is sold for manufacturing purposes will only be an alloy and not pure gold. As pointed out by J. Paul De Castro in his book "Law and Practice of Hall-Marking Gold and Silver Wares", pure gold is exceedingly soft and consequently seldom employed uncombined in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd this quality, when fully upto the standard of fineness, is hall-marked. The demand for it is largely increasing. It is chiefly employed in the manufacture of keeper and fancy rings, but there is a good trade in old gold coins of this class of gold." Therefore, the gold which is sold for manufacturing purposes will only be an alloy and not pure gold. The word bullion is a technical word. The word is generally used in commercial circles. The well established rule of construction of words used in statutes is thus stated in Black's Interpretation of Law at page 187: "Words of commerce or trade, in a tariff law, or other statutes relating to those subjects, are to be taken in their accepted commerce or trade signification; and if it is sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n' is given the popular meaning or the meaning given to it in trade, that expression means not only pure gold or silver but also an alloy of gold or silver with such small percentage of some other metal as does not take away from it, the character of bullion." In the instant case also the petitioners purchased sokka thangam, mixed a small percentage of copper to make it "sovereign" gold and sold it to their customers for the purpose of making jewels. We think that the correct interpretation of the word bullion is the one given by the learned judges of the Mysore High Court and we prefer to follow their decision and with respect we differ from the decision of the Andhra Pradesh High Court in Akhraj Parakh v. The State of Andhra Pradesh(2). ..... X X X X Extracts X X X X X X X X Extracts X X X X
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