TMI Blog1989 (6) TMI 269X X X X Extracts X X X X X X X X Extracts X X X X ..... e items described in the Schedule of taxable goods attached to the Act. The Superintendent of Taxes, however, did not accept the contention of the petitioner and held that pea-gravels was "sub-product of stone" and, as such, taxable under item 29 of the Schedule of taxable goods attached to the Act. In view of the above, the Superintendent of Taxes levied tax on the value of pea-gravels supplied by the petitioner. In addition to tax he also levied penalty under section 13 of the Act at the rate of 10 per cent of the tax for failure of the petitioner to furnish the return in time, and interest under section 25 of the Act. The petitioner preferred an appeal against the order of assessment and prayed for admission of the appeal without payment of the disputed amount of tax. The prayer was not allowed by the appellate authority in view of the second proviso to sub-section (1) of section 20 of the Act which has restricted the power of the appellate authority to issue direction for stay only to the extent of 50% of the tax or penalty. The petitioner was directed to pay the amount specified by the appellate authority in its order which were little over 50% of the demand for the purpose of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such not taxable. Mr. Barman Roy, the learned Advocate-General, submitted that this Court should interpret item No. 29 of the Schedule uninfluenced by the stand taken by the Revenue and if on such an interpretation it comes to a finding that pea-gravels supplied by the petitioner fall under item No. 29 it should hold the same to be taxable. 5.. We have considered the aforesaid submissions of the learned counsel for both the parties. We are of the firm opinion that the question as to whether a particular commodity is subject to tax or not, can be determined by the High Court in an application under article 226 of the Constitution. We are also of the opinion that the interpretation of taxable item being a pure question of law it should be decided by this Court without giving undue weight to the stand taken by the assessing officer in the assessment order or in the counter. 6.. By section 3, tax has been levied on every dealer in taxable goods on his turnover at the rates specified in column 3 of the Schedule attached to the Act. Dealer has been defined in clause (b) of section 2 of the Act to mean any person who sells taxable goods manufactured, made or processed by him in Tripur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... construed according to their popular sense. When a word has scientific or technical meaning and has also ordinary meaning according to common parlance it is the latter sense in which in a taxing statute the word should be held to have been used unless contrary intention is clearly expressed by the legislature. 8.. The aforesaid common parlance test was applied by the Supreme Court in Ramavatar Budhaiprasad v. The Assistant Sales Tax Officer [1961] 12 STC 286. In that case the question was whether "betel leaves" were "vegetables". It was held that the word "vegetable" in taxing statute is to be understood as in common parlance, i.e., denoting class of vegetables which are grown in a kitchen garden or in a farm and are used for the table; and in that view of the matter it was held that "betel leaves" are not "vegetables". The aforesaid test has been followed in a series of later decisions of the Supreme Court as well as various High Courts. It is now well-settled that a word of every day use must be construed in its popular sense. It is to be construed as understood in common language. Applying the common parlance test, in Indo International Industries v. Commissioner of Sales Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted popular connotation to the expression "cloth". In Thillai Chidambara Nadar v. Additional Appellate Assistant Commissioner [1985] 60 STC 80, the Supreme Court held that ripened coconut is not fresh fruit or vegetable. It was observed: "'Fresh fruits' and 'vegetables' being household articles of every day use for the table, these will have to be construed in their popular sense meaning the sense in which every householder will understand them. Viewed from this angle, the most apposite test would be: Would a householder when asked to bring home some 'fresh fruit' and some 'vegetable' for the evening meal, bring coconut? Obviously the answer is in the negative." There is also a recent decision of this Court in Kali Kumar Sharma v. Sales Tax Tribunal, Tripura [1989] 1 GLR 91, where the precise point for determination was whether "betel-nut" can be called "dry or preserved fruit". This Court, following the aforesaid principles, held that betel-nut cannot be understood as fruit. It was observed: "It is not the technical or dictionary meaning which has to prevail but the common sense view or the popular sense in which the word or expression is understood. In common parlance betel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fairly well-settled is that those words and expressions should be construed in the sense in which they are understood in the trade, by the dealer and the consumer. The reason is that it is they who are concerned with it and, it is the sense in which they understand it which constitutes the definitive index of the legislative intention." In a recent decision in Collector of Customs, Bombay v. Swastic Woollens (P.) Ltd. [1989] 72 STC 201, the Supreme Court interpreting an item in the Customs Act reiterated that where no statutory definition is provided in respect of an item in the Customs Act, the trade understanding, meaning thereby the understanding in the opinion of those who deal with the goods in question, is the safest guide. 10.. In fact though the common parlance or trade or commercial parlance test is the generally accepted test, the courts have applied from time to time some other tests also to interpret items of taxing statutes. One of such tests is "commonsense test" or "commonsense rule of interpretation". This rule was laid down by the Supreme Court in Tungabhadra Industries Ltd. v. Commercial Tax Officer, Kurnool [1960] 11 STC 827, where it was held that hydrogena ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the particular category to which they have been held to belong irrespective of their end use. In Annapurna Carbon Industries Co. v. State of Andhra Pradesh [1976] 37 STC 378, the Supreme Court while interpreting the expression "arc carbons" held that "arc carbons" are mainly used for production of powerful light used in projectors in cinemas and are known as "cinema arc carbons" in the market. The fact that "arc carbons" can also be used for searchlights, signalling, stage lighting, or where powerful lighting for photography or other purposes may be required, could not detract from the classification to which the carbon arcs belong. In Mukesh Kumar Aggarwal Co. v. State of M.P. [1988] 68 STC 324 (SC), the question for determination was whether the subsidiary parts of eucalyptus tree sold in heaps by the forest department after separation of "ballies" and "poles" could be called timber. In the notifications inviting tenders and certain other documents it was variously described as "eucalyptus fire-wood stacks", "eucalyptus wood stacks", "Nilgiri fuel-wood", etc. The Supreme Court held that the nomenclature used in such documents 'is not determinative of or conclusive of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. State of Haryana [1973] 32 STC 623 (SC)]. This position was reiterated by the Supreme Court in Collector of Central Excise, Kanpur v. Krishna Carbon Paper Co. [1989] 72 STC 280, where it was held by Sabyasachi Mukherji, J: "It is well-settled that in order to ascertain the correct meaning of a fiscal entry reference to a dictionary is apt to be somewhat delusive guide, as it gives all the different shades of meaning." 14.. It is also by now well-settled that if two views are possible regarding classification of certain goods the benefit must go to the tax payer. If a tax payer seeks advantage, which was not intended by the legislature, but to which he was entitled on a construction of the statute he must be given that advantage [See Atkinson v. Goodlass Wall and Lead Industries Ltd. [1950] 31 TC 447 (HL) at page 472; Commissioner of Income-tax v. Vegetable Products Ltd. [1973] 88 ITR 192 (SC); State of Bombay v. Automobile and Agricultural Industries Corporation [1961] 12 STC 122 (SC) and Commissioner of Income-tax v. M.P. Jatia [1976] 105 ITR 179 (SC); [1976] 4 SCC 92 at page 96]. 15.. The principles laid down by the courts in various decisions discussed above can be summar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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