TMI Blog1990 (11) TMI 383X X X X Extracts X X X X X X X X Extracts X X X X ..... er cent single point treating the turnover falling under entry 3 of the First Schedule and the balance of the turnover of Rs. 3,59,220.41 at 9 per cent treating that turnover falling under entry 55 of the First Schedule. The Tribunal accepted the levy of tax at 13 per cent and 9 per cent as levied by the Revenue rejecting the case of the assessee that the turnover must be taxed only under entry 111 of the First Schedule. Hence the present revision petition. 3.. Mr. K.J. Chandran, the learned counsel appearing for the petitioner, submitted that entry 111 of the First Schedule, being a special entry for oil engines and parts and accessories, introduced for the first time by Tamil Nadu Act 23 of 1974 from March 4, 1974, will exclude all other general entries like entry 3 and entry 55. The bearings in question having been sold only for diesel engines, the tax liability has to be fixed with reference to entry 111 of the First Schedule which is a special entry and not under entry 3 or entry 55 of the First Schedule which are general entries. 4.. The next contention of the learned counsel for the petitioner is that the Tribunal's view that the rate of tax has to be fixed with referenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cial entry. Section 5 cannot be construed to mean that once the commodity or article is taken out of the entries in Schedule A to the Act because the same is governed by a specific entry contained in other schedules still the turnover in respect of the article or commodity has to be given an immunity from the liability to pay tax." To appreciate this contention, it is necessary to set out entries 3, 55 and 111, as they stood at the relevant time. They read as follows: ----------------------------------------------------------------------------"S. Description of the goods Point of Rate of Effective No. levy tax from (1) (2) (3) (4) (5) per cent ----------------------------------------------------------------------------- 3. Entry from 23-12-1964 At the 11 1-12-1965 Motor vehicles including motor point of cars, motor taxi-cabs, motor cycles first sale 12 18-6-1967 and cycle combinations, motor in the 15 26-2-1970 scooters, motorettes, motor omni State buses, motor vans and motor lorries, chassis of motor vehicles, bodies built on chassis of motor vehicles belonging to others (on the turnover relating to bodies), component parts of motor vehicles, all varieties of trailers, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or entry 55, as the case may be. In [1976] 38 STC 118 (State of Tamil Nadu v. Sha Maggajee Saremal and Brothers), a Division Bench of this Court, while considering the sales of spare parts for diesel engines for the assessment year prior to the introduction of entry 111, held as follows: "Entries in the First Schedule to the Tamil Nadu General Sales Tax Act, 1959, being specific goods in respect of which a single point levy is prescribed, though they might be goods which come under the description of goods in section 3, they could be taxed only to single point and not to multi-point under the general provision of section 3. The assessee imported tractor parts under an import licence which authorised the assessee to import only spare parts for agricultural tractors. The assessee also paid customs duty as for spare parts for agricultural tractors. But in most of the transactions, the assessee had sold the articles as 'spare parts for diesel engines'. The question for consideration was whether the tax was leviable under entry 55 of the First Schedule or under the general provision contained in section 3: Held, that entry 55 of the First Schedule mentioned all tractors and spare ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en to all the words used therein. If a particular article would fall within a description, by the force of words used, it is impermissible to ignore that description, and denote the article under another entry, by a process of reasoning. In the instant case, entry No. 78 is attracted by the Revenue, only by a process of interpretation of the words 'and the like' in the said entry. But, entry No. 110 is clearly attracted by the application of a simple and direct test of giving full meaning to the words used therein, that is to say, by giving due weight and effect to the meaning conveyed by the words 'all articles made of plastics.....'. Therefore, we are of the view that the approach of the revising authority as well as of the Tribunal in applying entry No. 78 was not proper. Further, if there is any doubt as to which entry a particular article would fall, the benefit of doubt should be extended to the assessee in view of the well-established principle governing the interpretation of a taxing statute. " In Girja Shanker Dubey v. Commissioner of Sales Tax reported in [1968] 21 STC 127, the Allahabad High Court has observed as follows: "We doubt the correctness of the proposition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n requested-Regarding. Ref: From M/s. Simpson and Company Ltd., M/s. Ashok Leyland Limited and M/s. Standard Motor Products (India) Ltd. representation dated November 17, 1977. I am directed to state that if the diesel engines sold by your firm are used by the purchasers as component parts in automobiles, etc., then they will be eligible for concessional rate of tax at 3 per cent under section 3(3)(1) of the Tamil Nadu General Sales Tax Act on the production of a declaration in form 17, as the diesel engines used in the automobiles and tractors are identifiable. If they are used for any other purpose other than by way of component parts, they are liable to tax at 8 per cent under item 111 to the First Schedule to the Tamil Nadu General Sales Tax Act, 1959." The learned counsel also placed before the Court certain assessment orders passed on the basis of those clarifications. On the basis of those clarifications, the contention is that the Revenue had always understood entry 111 as a special one and they cannot turn round and say that the bearings sold by the assessee will not fall under entry III. In support of that, the learned counsel placed reliance on the following judgme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... furnishing legitimate aid in the construction of entry 112 and entry 118. Dealing with this principle of construction, the Supreme Court in Varghese' case [1981] 131 ITR 597 (SC) observed at page 612: 'The rule of construction by reference to contemporanea expositio is a well-established rule for interpreting a statute by reference to the exposition it has received from contemporary authority, though it must give way where the language of the statute is plain and unambiguous. This rule has been succinctly and felicitously expressed in Crawford on Statutory Construction, 1940 Edn., where it is stated in paragraph 219 that "administrative construction (i.e., contemporaneous construction placed by administrative or executive officers charged with executing a statute) generally should be clearly wrong before it is overturned; such a construction, commonly referred to as practical construction, although non-controlling, is nevertheless entitled to considerable weight, it is highly persuasive". The validity of this rule was also recognised in Baleshwar Bagarti v. Bhagirathi Dass [1908] ILR 35 Cal 701, 713, where Mookerjee, J., stated the rule in these terms: "It is a well-settled pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. The courts, however, in interpreting a word used in a statute may have regard to the interpretation placed by those who are presumed to be acquainted with the economic significance of the tax in question. It is true that these interpretations given by the authorities have no force of law nor are they binding upon the courts. Nevertheless they may serve as a tool of construction of some words used in the statute." In the light of these above pronouncements, we are of the view that the learned counsel is again well-founded in his contention that the Revenue cannot take a different stand. Viewed from any angle, we are of the view that the bearings sold by the assessee will fall only under entry 111 of the First Schedule, and the contrary view taken by the Tribunal cannot be sustained. The argument of the learned Additional Government Pleader placing reliance on [1976] 38 STC 118 (Mad.) (State of Tamil Nadu v. Sha Maggajee Saremal and Brothers), as already pointed out, is of no avail. Though the argument that circulars have no binding force on the Tribunal and the courts is a correct proposition of law, that does not mean, the court is precluded from looking into the clarificati ..... 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