TMI Blog1990 (1) TMI 298X X X X Extracts X X X X X X X X Extracts X X X X ..... 3.. According to the assessee, the process of manufacture renders the coffee-chicory powder a refined form of coffee which leaves no sediment while coffee is made out of it. The further case of the assessee is that the product is popularly known in the market as "Bru coffee". 4.. There were separate entries for the purpose of imposing sales tax for coffee and chicory till September 15, 1980. The items were Nos. 37 and 38 of the First Schedule to the Act. Both items were taxable at the first point of sale in the State at the rate of 6 per cent. Petitioner collected and paid tax at the rate of 6 per cent as provided under item 37 of the First Schedule on all their sales of Bru up to September 15, 1980. From September 16, 1980, the petitioner treated Bru as coming under entry 21 providing for coffee, tea, spices and manufactures thereof, taxable at the rate of 6 per cent at the first point of sale in the State. Petitioner continued to collect and pay tax at the rate of 6 per cent on all their sales of Bru for the year 1980-81. From April 1, 1983, entry 21 was amended to exclude from it "French coffee" and a new entry 21A was inserted for French coffee providing for tax on it at the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emaining period under item 33. In regard to the assessment years 1981-82 and 1982-83, the only question is whether the tax has to be levied under item 21 or 33 of the First Schedule to the Act. Now we shall consider the question separately with respect to the relevant years. T.R.C. No. 64 of 1989: 9.. In this case, we have to consider two periods, viz., period up to September 16, 1980 and from September 16, 1980, till the end of the assessment year. The description of item 25P is non-alcoholic drinks and beverages, bottled or canned and sold under brand name. The point of levy is first sale in the State by a dealer who is liable to tax under section 5. The rate of tax is 10 per cent. The Tribunal held that for the period up to September 15, 1980, the entry that is relevant for the purpose of levying sales tax on the sale turnover of Bru is 25P of the First Schedule to the Act. The Tribunal also found that after the period September 15, 1980, the relevant entry is 33. 10.. Counsel for the assessee contended that there is absolutely no justification for levying sales tax for the sales turnover of Bru under entry 25P. Entry 25P is an exclusive entry for non-alcoholic drinks and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... answer to the question are entries 21 and 33. Entry 21 comes under the broad heading coffee, tea, spices and manufactures thereof. The description of entry 21 is "coffee", that is to say, any one of the forms of coffee such as coffee beans, coffee-seeds (raw or roasted) coffee powder but not including coffee drink. Entry 33 is non-alcoholic drinks, squashes, sauces and beverages, bottled or canned and sold under brand name. The explanation to this entry reads thus: "Powders and tablets used for the preparations of non-alcoholic drinks shall, whether or not they are bottled or canned, be liable to tax under this item or item 34." In regard to item 33 and item 21, the point of levy is first sale in the State by a dealer who is liable to tax under section 5. The rate of tax in regard to item 21 is 6 per cent and item 33 is 10 per cent. The Tribunal has held that the assessee-revision petitioner is liable to pay sales tax on the sales turnover of Bru for the period September 16, 1980 to April 1, 1981 and for the assessment years 1981-82 and 1982-83 at the rate of 10 per cent under entry 33. The assessee challenges this determination and submits before us that the assessee is liable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies, itself, is an indication that before the amendment coffee mixed with chicory is also considered and treated for the purpose of sales tax as coffee. Counsel submitted that in considering what is the entry that is applicable for the purpose of levying sales tax in regard to an article sold by an assessee, the entry has to be construed as understood popularly by the consumers and those persons who deal in those items. Counsel also invited our attention to the conspicuous absence of beverages in the explanation to entry 33. 14.. It is a well-settled proposition of interpretation that if certain words are used in a statute which are capable of being construed in a popular sense, that is to say, how people in general understand the meaning of those words, such words should not be construed according to the strict or technical meaning of the language contained in them, but have to be construed in its popular sense, that is to say, in the sense, which people conversant with the subject-matter will understand them. Words in everyday use when come up for interpretation before the court, therefore, have to be construed according to their popular sense. This principle is well-settled by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sugar of any shape or texture, colour or density and by whatever name it is called. 18.. In Tungabhadra Industries Ltd. v. Commercial Tax Officer [1960] 11 STC 827 (SC), a Bench of five Judges had occasion to consider whether hydrogenated groundnut oil commonly called vanaspati is groundnut oil within the meaning of rule 18(2) of the Madras General Sales Tax (Turnover and Assessment) Rules, 1939. After a very detailed examination of the inter-molecular change in the content of the substance, viz., vanaspati, in re groundnut oil, the court held that even though in the course of hydrogenation, the oil absorbed two atoms of hydrogen and there was an inter-molecular change in the content of the substance, but the hydrogenated oil continued even after the change, to be groundnut oil and that hydrogenated oil (vanaspati) cannot be denied that benefit of the deduction from the turnover on the ground that vanaspati has ceased to be groundnut oil. 19.. We feel that people in the trade and commerce conversant with the subject, viz., Bru, understand it in the usual course as a form of coffee and in that sense we have to hold that "Bru" is a form of coffee and that the entry that is applic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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