TMI Blog1976 (10) TMI 132X X X X Extracts X X X X X X X X Extracts X X X X ..... at Act it is stated that the expression "tobacco" shall have the meaning assigned to it in item 4 of the First Schedule to the Central Excises and Salt Act, 1944. Item 4 of the First Schedule to the Central Excises and Salt Act, 1944, defines "tobacco" as follows: " 'Tobacco' means any form of tobacco, whether cured or uncured and whether manufactured or not, and includes the leaf, stalks and stems of the tobacco plant, but does not include any part of a tobacco plant while still attached to the earth." The case of the petitioners is that tobacco seed oil and tobacco seed oilcake are only forms of tobacco. In support of their contention they relied upon a decision of this court in Sikkakollu Subba Rao Co. v. State of Andhra Pradesh[1975] 36 S.T.C. 457. (W.P. No. 2825 of 1973 decided on 18th December, 1974), in which it was held that the expression "tobacco" would include tobacco seeds and, therefore, tobacco seeds would be exempt from the levy of sales tax. It was observed that the definition of "tobacco" in the Central Excises and Salt Act, 1944, was an inclusive one and was not intended to be exhaustive. The parts of the tobacco plant like tobacco leaves, stalks and stems m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... throwing light on the interpretation of the expression "tobacco" even after the amendment. While considering the question whether tobacco seed would also constitute "tobacco", the Division Bench at pages 657 and 658 refers to the dictionary meaning of "tobacco" and says that tobacco is the name given to the plant as a whole of which the seeds form part and so seeds also constitute tobacco. But they go on to add that they do so only so long as they remain attached to the plant. This is repeated in the next paragraph also where they say that all the parts of the plant including the seeds come within the ambit of "tobacco" only so long as the plant continues to remain attached to the earth. I am unable to appreciate what is meant by this. When the leaf is dried and sold as tobacco, whether cured or uncured, it is always removed from the plant and it does not form part of the plant which continues to remain attached to the earth. But it cannot be said that it is not tobacco simply because it is severed from plant. On the other hand, in the definition of "tobacco" in the Central Excises Act it is stated that it will not include any part of the tobacco while still attached to the earth. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the relevant entry in the Fourth Schedule of the Act, much less can tobacco seed oil and tobacco seed cake be said to be tobacco withIn the meaning of the said entry. Under section 8 of the Act, subject to such restrictions and conditions as may be prescribed, including conditions as to licences and licence fees, a dealer who deals in the goods specified in the Fourth Schedule shall be exempt from tax under this Act in respect of such goods. Item 7 in the Fourth Schedule is "tobacco". Explanation to the Fourth Schedule says that "expressions in items 5, 6 and 7 shall have the same meanings assigned to them in the Additional Duties of Excise (Goods of Special Importance) Act, 1957", being Central Act 58 of 1957. When one turns to that Act, one finds that under section 2(c) of the Additional Duties of Excise (Goods of Special Importance) Act, 1957, the word "tobacco" shall have the meaning assigned to it in item 4 of the First Schedule to the Central Excises and Salt Act, 1944, and item 4 of the First Schedule to the Central Excises and Salt Act defines "tobacco" as follows: "'Tobacco' means any form of tobacco, whether cured or uncured and whether manufactured or not, and includ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... necessary that we should know the meaning of the word 'tobacco' to be able to appreciate the respective contentions urged for the parties. This term is not defined or explained anywhere in the Act. 'Tobacco' is a plant of American origin with narcotic leaves used for smoking, chewing or snuff, according to Concise Oxford Dictionary. This expression is explained in Webster's New International Dictionary as 'any plant of the genus Nicotiana, especially of the species cultivated for their leaves, the most common being Nicotiana tobacum of South American origin. It is a tall annual plant with ample ovate or lanceolate leaves and white or pink tubular flowers'. The meaning assigned to this term in the Reader's Digest Great Encyclopaedic Dictionary is almost the same. According to this dictionary 'tobacco' means 'various species of Nicotiana, especially Nicotiana tobacum, native of tropical America, tall annual plant with white or pink tubular flowers and large ovate leaves used, dried, and variously prepared, for smoking or chewing or in the form of snuff.' The word 'tobacco' therefore connotes the plant going by that name as a whole and not merely its leaves as sought to be contended ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1970, tobacco seed could not be said to be exempted from sales tax under the A. P. General Sales Tax Act. However, the Division Bench pointed out that tobacco seed oil and tobacco seed oilcake were neither tobacco nor its products and these two items were not entitled to exemption envisaged in item 7 of the Fourth Schedule to the Act. In order to derive support for its conclusion that tobacco seed was not tobacco as distinct from a product of tobacco, the Division Bench looked at item 4 of the First Schedule to the Central Excises and Salt Act, 1944, for the purpose of being fortified for the view that they had taken, viz., that tobacco seed is not tobacco. After referring to the definition of "tobacco" in item 4 of the First Schedule to the Central Excises and Salt Act, Venkateswara Rao, J., speaking for the Bench, observed: "It is true that no mention of seeds is made in this definition; but this is no reason to infer that seeds do not form part of tobacco in view of the employment of the word 'includes' in it, thereby indicating that it Here italicised. is only illustrative in nature and not exhaustive. A careful examination of this definition would reveal that the expres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court in Commissioner of Income-tax, A. P. v. Taj Mahal Hotel[1972] 82 I.T.R. 44 (S.C.) In paragraph 6, at page 170 (page 47 of 82 I.T.R.) Grover, J., speaking for the Supreme Court, has observed: "The word 'includes' is often used in interpretation clauses in order to enlarge the meaning of the words or phrases occurring in the body of the statute. When it is so used, these words and phrases 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." In the instant case, therefore, when item 4 in the First Schedule to the Central Excises and Salt Act of 1944 says that "tobacco " means any form of tobacco, whether cured or uncured, and whether manufactured or not, and includes the leaf, stalks and stems of the tobacco plant, what the definition provides for is that any form of tobacco as ordinarily understood in its natural import cured, uncured or whether manufactured or not comes within this definition and by the use of the word "includes", the legislature has indicated that leaf, stalks and stems of the tobacco plant, even if they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to the subject should be taken as its meaning. The word 'tobacco', according to its ordinary dictionary meaning, is not merely any part of the tobacco plant like its leaves but the plant itself. Therefore, the expression 'tobacco', without any definition, would include the entire tobacco plant. By the definition in question, the expression was intended to be given both some restricted and enlarged meaning. By its enlarged scope both cured and manufactured tobacco are brought into it and not merely its natural state. By its restricted scope tobacco plant or any part of it while the plant is attached to the earth were taken out of its purview. By giving an inclusive definition, it does not appear that the definition was intended to be restricted only to those parts of tobacco plant mentioned therein." He held that tobacco seeds must be taken as part of the definition under item 4 of the First Schedule to the Central Excises and Salt Act, 1944, and he therefore held that tobacco seeds are exempted from tax by virtue of section 8 of the Act read with item 7 in the Fourth Schedule to the Act. With great respect to our learned brother, Ramachandra Raju, J., we are unable to agree ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e plant Is severed from the earth and ceases to be attached to the earth, only those three parts specifically enumerated in the definition, viz., leaf, stalks and stems, are included in the definition of "tobacco" and not any other parts of the tobacco plant after the plant is severed from the earth. It is thus clear that the definition in the Central Excises and Salt Act could by no stretch of imagination be said to cover tobacco seed as falling within the definition of the word "tobacco". The statement of objects and reasons to the Bill, which was enacted as the Additional Duties of Excise (Goods of Special Importance) Act, 1957, points out: "The object of the Bill is to impose additional duties of excise in replacement of the sales taxes levied by the Union and the States on sugar, tobacco and mill-made textiles and to distribute the net proceeds of these taxes, except the proceeds attributable to the Union territories, to the States. The distribution of the proceeds of the additional duties broadly follows the pattern recommended by the Second Finance Commission. Provision has been made that the States which levy a tax on the sale or purchase of these commodities after the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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