2007 (7) TMI 596 - HC - VAT and Sales Tax

Whether optical fibre cable and accessories are leviable under the Assam Entry Tax Act 2001? Whether the word include appearing in the definition clause of an enactment shall always be interpreted to have been used for expanding the definition of a given term or can the use of the word include be illustrative clarificatory or exhaustive? Held that - None of the authorities cited by Mr. Dubey lays down that the word include or including occurring in a definition clause will always reflect the legislative intent to expand the meaning of the term sought to be defined. Hence it is not necessary that always and invariably the word include or including which appears in a statute would be aimed at expanding the meaning of the term sought to be defined by using the word include or including . Where the word include or including brings within the sweep of a term such word or words which carry very wide meaning or which do not ordinarily fall within the term which is sought to be defined then the term which is sought to be defined must be construed as comprehending not only such things as they signify according to their nature and import but also those things which the interpretation clause declares that they shall include. However when the word include or including is used in interpretation clauses for the purpose of including within the definition of a term a particular item which would otherwise also fall within such a term such use of the word include or such inclusive definition of a given term would imply exhaustiveness and limitation. When this test is applied to the facts of the present case it becomes transparent that by using the word including in entry 4 the Legislature intended to illustrate as to what items the expression sound transmitting equipment would convey. It further logically follows that under entry 4 sound transmitting equipment would include only telephones mobile phones pagers and components and parts thereof and no other item such as optical fibres cables and accessories. Situated thus it is clear I do hold that no entry tax in terms of entry 4 of the Act of 2001 can be imposed on the entry of goods such as optical fibres cables and accessories. W.P. succeed

Issues Involved:
1. Levy of entry tax on optical fibre, cables, and accessories under the Assam Entry Tax Act, 2001.
2. Interpretation of the word "include" in the definition clause of an enactment.
3. Determination of whether "include" conveys exhaustiveness or expansiveness in the context of the Act.
4. Validity of the notifications and communications issued regarding the imposition of entry tax.

Detailed Analysis:

1. Levy of Entry Tax on Optical Fibre, Cables, and Accessories:
The primary issue was whether optical fibre, cables, and accessories are liable to entry tax under the Assam Entry Tax Act, 2001. The petitioner argued that these items do not fall under entry 4 of the Schedule to the Act, which lists "sound transmitting equipment including telephones, mobile phones, pagers and components and parts thereof." The court concluded that optical fibre, cables, and accessories are not specifically mentioned in the Schedule and thus are not covered under entry 4.

2. Interpretation of the Word "Include":
The court examined whether the word "include" in the definition clause should always be interpreted to expand the meaning of a term. The petitioner argued that "include" can be used in a restrictive sense, implying exhaustiveness. The court agreed, citing various judgments, and held that "include" can sometimes be used for clarification or limitation rather than expansion.

3. Determination of Exhaustiveness or Expansiveness:
The court analyzed whether the word "include" in entry 4 was used to expand or limit the definition of "sound transmitting equipment." It was determined that since telephones, mobile phones, and pagers naturally fall within "sound transmitting equipment," their specific mention indicates a restrictive intent. Therefore, the term "sound transmitting equipment" in entry 4 is exhaustive and does not encompass optical fibre, cables, and accessories.

4. Validity of Notifications and Communications:
The court reviewed the notifications and communications issued by the respondents, which demanded entry tax on optical fibre, cables, and accessories. It was found that these items are not taxable under entry 4, and thus, the notifications and communications were invalid. Consequently, the court set aside and quashed the impugned notifications and communications.

Conclusion:
The court concluded that optical fibre, cables, and accessories are not subject to entry tax under the Assam Entry Tax Act, 2001, as they do not fall within the scope of entry 4 of the Schedule. The word "include" in entry 4 was interpreted to imply limitation rather than expansion. The impugned notifications and communications demanding entry tax on these items were set aside and quashed. The respondents were directed not to invoke the bank guarantee for the realization of entry tax, and any amount deposited towards entry tax was ordered to be refunded to the Oil India Limited. The interim directions were made absolute, and the writ petition was disposed of without any order as to costs.

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