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TMI Blog1960 (2) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... 1954-55. They also obtained separate licences from the municipality for running their respective businesses. Messrs. Bayya Subbarao & Co., dealt in gingelly oil which is also a produce of their hand-oil presses and pulses till 1st August, 1954. Thereafter they confined themselves exclusively to dealings in castor oil and castor cake from 1st August, 1954. The purpose for which this was done was to obtain the benefit of exemption from sales tax, under G.O. No. 402 dated 2nd July, 1954, which granted an exemption form sales tax to "every person owning or having an interest in hand-oil presses, single or multiple and dealing exclusively in the produce of such presses, from the payment of any tax under section 3(1) of the said Act, in respect of the turnover of such produce." Notwithstanding the discontinuance of the business in pulses by the respondent, the department clubbed both the firms as one unit and assessed it. Thus the exemption contemplated by the G.O. was disallowed to the respondent. An appeal was filed against the assessment made by the concerned Commercial Tax Officer impeaching the validity of the assessment on the ground that the assessee, Messrs Bayya Subbarao & Co., ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion, the learned counsel for the State relied also on the following passage from Maxwell's Interpretation of Statutes (page 305 of the Ninth Edition). In applying the principles stated above, one should not lose sight of what may be considered its counterpart, namely, that a taxing statute should be construed strictly in favour of the subject in case of any reasonable doubt. Taking the two together, it seems to me that by 'person' in the entry in column 3 against item 21 the Legislature intended 'juristic person' and not 'person as understood in the popular sense.' For the reasons mentioned above, I hold that the shop known as Govindram Surajmal No. 35 is entitled to the exemption it has asked for." The point for determination in this revision case is whether the opinion of the Board of Revenue, Madhya Pradesh, which was followed by the Sales Tax Appellate Tribunal, is correct. This depends upon the true intepretation of the concerned Government Order namely, G.O. No. 402 in the light of the statutory provisions of the General Sales Tax Act. Before relief could be claimed under this Government Order, two conditions have to be satisfied: (i) that the person invoking the exemptio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orth pointing out that the words 'unless the context otherwise requires' which we find in the Consolidation Act of 1929 are not to be found in the Amending Act of 1928. I attribute little weight to this fact, for, in my opinion, some such words are to be implied in all statutes where the expressions which are interpreted by a definition clause are used in a number of sections with meanings sometimes of a wide and sometimes of an obviously limited character." Before we proceed further to examine the precise meaning of the word "person", we will read the definition of "dealer" in the Act. "Dealer" means "any person who carries on the business of buying, selling, supplying or distributing goods, directly or otherwise, whether for cash or for deferred payment, or for other valuable consideration, and includes-(i) a State Government or a Hindu joint family which carries on such business; (ii) any society including a co-operative society, club, firm or association which buys goods from, or sells, supplies or distributes goods to its members; (iii) any commission agent, a broker, a del credere agent, an auctioneer or any other mercantile agent, by whatever name called, who carries on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndhra hereby exempts, with effect on and from the 1st April, 1954, from the tax payable under section 3, subsection (1) of the Act, (1) the sales of any cloth woven on handlooms, by persons who deal exclusively in such cloth, and (2) the sales of flowers, eggs, fruits, vegetables and meat (other than potatoes, onions, coconuts and canned, preserved, dried and dehydrated fruits, vegetables and meat), Explanation: (3) the sales of fish other than canned fish." These are some of the instances of exemptions that were granted by the Government by virtue of the powers conferred on them by section 6(1)(i) of the Madras General Sales Tax Act, 1939. We may now give a few illustrations of exemptions granted to a "specified class of persons" in regard to their turnover under section 6(1)(ii). Under G.O. No. 1323, Revenue, dated 6th May, 1953. "..............every person owning or having an interest in country oil chekkus, single or multiple, and dealing exclusively in the produce of such chekkus (is exempted permanently) from payment of any tax under section 3(1) of the said Act in respect of such dealings." Likewise, under G.O. Press No. 2532, Revenue, dated 2nd September, 1953, the Governor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... artnership " or "firm" is not equated to a "person" because it is used as a compendious name for several individuals who have agreed to share the profits and the two expressions embody two different concepts. The general concept of partnership embodied in our system of law is that a firm is not an entity or a person. There is abundant authority for this proposition. Dulichand v. Income Tax Commissioner[1956] A.I.R. 1956 S.C. 354; 29 I.T.R. 535. illustrates this rule. One of the questions that presented itself before their Lordships of the Supreme Court in that case was whether a firm could enter into a partnership with another firm or a joint Hindu family or an individual. This was answered in the negative for the reason that section 4 of the Indian Partnership Act contemplates only natural or artificial persons and a firm is not a "person." Their Lordships expressed the opinion that there was no warrant for importing the definition of "person" given in the General Clauses Act into the Partnership Act. Another instance of this principle is furnished by the decision in Seodoyal Khemka v. Joharmull Manmull[1923] I.L.R. 50 Cal. 549. Page, J., who rendered the judgment, observed that a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esh General Sales Tax Act. But for this provision, the Madras General Clauses Act would have a partial application to the Andhra Pradesh General Sales Tax Act. Therefore, we cannot derive any assistance from section 2(2) of the Andhra Pradesh General Sales Tax Act, 1957. In support of the proposition that a firm is a legal entity, reliance is placed on State v. BasdeoA.I.R. 1951 All. 44. We do not think that this ruling lends any assistance to the respondent. On the other hand, it was laid down that a firm was not an entity apart from the persons constituting it. Their Lordships of the Allahabad High Court, in overruling the contention that it was a juristic person, extracted the following statement of law contained in Bhagwanji Morarji v. Alembic Chemical Works Ltd.A.I.R. 1948 P.C. 100. "Before the Board it was argued that under the Indian Partnership Act, 1932, a firm is recognised as an entity apart from the persons constituting it and that the entity continues so long as the firm exists and continues to carry on its business. It is true that the Indian Partnership Act goes further than the English Partnership Act, 1890, in recognising that a firm may possess a personality dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d opinion, the words "person" and "dealer" have been used by the Government in the several G.Os. in two different senses and in the concerned G.O. the word only connotes an individual as distinct from a firm or an association or collection of individuals falling within the ambit of the definition of "person" occurring in the Madras General Clauses Act (I of 1891). The purpose for which the General Clauses Act was enacted was stated by Sinha, J., (as he then was) in N. Subrahmania Iyer v. Official Receiver A.I.R. 1958 S.C. 1 at 10. in the following words: "It may be added that a General Clauses Act is enacted in order to shorten language used in parliamentary legislation and to avoid repetition of the same words in the course of the same piece of legislation. Such an Act is not meant to give a hide-bound meaning to terms and phrases generally occurring in legislation. That is the reason why the definition section contains words like 'unless there is anything repugnant in the subject or context.'" We do not think that there is any warrant for incorporating the definition of "person" given in the Madras General Clauses Act (1 of 1891) into the Madras General Sales Tax Act, 1939. It ..... X X X X Extracts X X X X X X X X Extracts X X X X
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