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TMI Blog1975 (7) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... ered dealer and carries on business of agarbatti only. The respondent-dealer filed return for the year 1971-72 and he paid tax on the turnover of sale of agarbatti @ 7 per cent for the first three quarters of 1971-72 and @ 8 per cent for the last quarter. This payment of tax was accepted by the AO. Subsequently the AO felt that the dealer has been under-assessed. According to the AO, agarbatties were originally included under entry No. 36 of the schedule providing tax for goods other than luxury goods. The said entry was inserted by notification No. 33927 dt. 30th Dec., 1957 and the rate of tax was 7 per cent. This entry continued to be the entry till 30th June, 1971. The said entry has been omitted by notification No. 23720 dt. 16th July, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g on his purchases and adding 10 per cent notitional profit to it. He reflected his GTO at Rs. 70,454.99. The learned AO referred to an inspection dt. 7th July, 1972. On the said date, the dealer could not produce purchase memo in respect of Aerabian Roses Brand agarbatti which he had in his stock. At the time of assessment, the assessee produced a purchase memo dt. 7th June, 1972 for a sum of Rs. 57.75 and that was for Aerabind Special Agarbati but not for Roses Brand agarbati. Therefore, the AO rejected the dealer's contention and found purchase suppression. On such finding, he enhanced the purchase figures by Rs. 1,000 and determined the GTO at Rs. 74,454.99 thereby making an enhancement of Rs. 4,000 even the returned figures. This year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s are luxury items. By using the general word 'glassware' in the relevant entry the Legislature obviously meant such glassware as are 'luxury' goods and similar by using the work 'perfumery' in entry No. 16, it must mean such items of perfumery as can be categorised at 'luxury goods'. So far as the word 'perfumery' is concerned, as already discussed above, the context in which it occurs also indicates that it is used only in respect of item used for personal hygiene. The word 'glassware' therefore, cannot possible apply to the articles like beaker, test tubes etc. which are used only for educational purposes or for experiment connected with scientific research or development. Similarly dhoop and agarbatti can be treated either as items of p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... annulled the extra demand. 5. The Additional State Representative urged the following points in support of the second appeal. He firstly urged that originally entry No. 36 of the rate chart providing tax on goods other than luxury goods included perfumery, cosmetic, pomades and all toilets articles including toilet soaps. This was inserted by notification No. 33937 dt. 30th Dec., 1957. There was some dispute that agarbatti is an item of perfumery and the said dispute has been resolved by the Supreme Court in the case reported in 25 STC Page 151 (CIT of Sales Tax, U.P. vs. Indian Herbs Research and Supply Co.) Hence it must be accepted that agarbatties are articles of perfumery. Further the dealer has treated them as such and has paid tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a later patent appeal which was reported in 33 STC page 120. Thus the decision of the Punjab Haryana High Court cannot be utilised by the first appellate Court as he is a creature of the statute. In case the assessee is aggrieved by inclusion of perfumery in the luxury goods, it is opened to him to take recourse to low by filing a writ petition or by filing a suit. But the first appellate Court as a creature of the statute cannot say that the entries are not applicable to the agarbatties. As such the decision of the first appellate Court is wrong and it should be set aside and the assessments as completed by the AO must be restored. 6. The learned counsel appearing for the respondent very vehemently urged that in the provisions of s. 5 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e are incorrect. But that can be only done either before the Hon'ble Court in a writ jurisdiction or by filing a suit and Tribunals created under this Statute cannot challenge the same. That is why the respondents in 33 STC Amirchand Omprakash filed writ petition before the High Court and urged that agarbatties even though perfumery cannot be taxed as luxury goods. The High Court in exercise of its jurisdiction under Art. 226 allowed the said prayer. I am convinced that the reasonings advanced by the respondent-assessee that dhoop-batties and agarbatties are not luxury goods is correct and as such it cannot be said that they will be taxed under entry No. 36 of the rate chart providing tax on luxury goods. But as a creature of the Statute, I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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