TMI Blog1981 (1) TMI 213X X X X Extracts X X X X X X X X Extracts X X X X ..... on a true construction of entry No. 15 of Notification No. ST-II-4949/X-10 (2)-74 dated May 30, 1975, issued under section 3-A of the U.P. Sales Tax Act, 1948, the negotiated sale of a thermal power plant by appellant No. 1 to appellant No. 2 is exigible to sales tax thereunder. The short facts giving rise to the question may be stated: A thermal power plant at Rampur comprising seven boilers, five turbines together with its associate auxiliaries, components and accessories originally belonged to the U.P. State Electricity Board. The Board, after selling it in working condition to appellant No. 1 on May 29, 1974, for Rs. 41.31 lakhs, called upon the latter to pay sales tax thereon which was paid under protest. Appellant No. 1 used it for generating electricity from May 29, 1974, to September 30, 1975. As the power position improved in the State of U.P. appellant No. 1 discontinued the generation of electricity through this power plant and finding it expedient to realise its investment negotiated a sale thereof in perfect working condition to appellant No. 2. Appellant No. 1 desired to charge sales tax on the said negotiated sale but appellant No. 2 informed appellant No. 1 that i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State Government to amend the entries in the schedule. In exercise of the aforesaid power the State Government issued Notification No. ST-II-4949/X-10(2)-74 dated May 30, 1975, which provided that with effect from June 1, 1975, the turnover in respect of the goods specified in column II of the schedule to this notification shall be liable to tax at the point of sale and at the rate specified respectively in columns III and IV thereof: SCHEDULE 'M' stands for sale by manufacturer in Uttar Pradesh. 'I' stands for sale by the importer in Uttar Pradesh. -------------------------------------------------------------------------------- Sl.No. | | Point at which | Rate of tax | Description of goods | tax shall be | | | levied | -------------------------------------------------------------------------------- I II III IV -------------------------------------------------------------------------------- 15. Old, discarded, unserviceable or Sale to 5 per cent. obsolete machinery, stores or consumer. vehicles including waste products except cinder, coal-ash and such items as are included in any other notification issued under the Act. -------------- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on "old" occurring in the entry. He urged that the four adjectives have been used disjunctively and each must be given its own separate meaning and pointed out that in two decisions, namely, State of Bombay v. Hospital Mazdoor Sabha [1959-60] 17 F.J.R. 423 (S.C.); [1960] 2 S.C.R. 866., and Corporation of the City of Nagpur v. Its Employees [1960-61] 18 F.J.R. 28 (S.C.); [1960] 2 S.C.R. 942., this Court refused to apply the said principle while construing the definition of "industry" given in section 2(j) of the Industrial Disputes Act, 1947, and in section 2(14) of the C.P. and Berar Industrial Disputes Settlement Act, 1947, respectively, and that in Letang v. Cooper [1965] 1 Q.B. 232., Diplock, L.J., has observed thus: "The maxim noscitur a sociis is always a treacherous one unless you know the societas to which the socii belong." According to him further the ejusdem generis principle would be clearly inapplicable inasmuch as it was not a case where some general words follow any particular, generic or specific words. Having given our anxious consideration to the rival contentions urged before us, we are clearly of the view that the principle of noscitur a sociis is clearly app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld be described as "old machinery". A machinery could be one day old, one month old, one year old, five years old or even ten years old (the degree of oldness being a relative concept) and which one is intended to be included in the entry has not been made clear at all. And, lastly, there is nothing in the entry to indicate that the adjective "old" has been deliberately used in a wider sense. In the absence of any indication to that effect and when the expression "old" is by itself vague, imprecise and ambiguous, being too general, the principle of noscitur a sociis will have to be applied, i.e., all the associated words will take colour from each other, the meaning of the more general adjective, viz., "old", being restricted to a sense analogous to the less general adjectives "discarded, unserviceable or obsolete". In other words in order to fall within the expression "old machinery" occurring in the entry, the machinery must be old machinery in the sense that it has become non-functional or non-usable. In our view, therefore, on a true construction the sale of the thermal power plant which at the time of sale by appellant No. 1 to appellant No. 2 was in perfect running conditi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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