TMI Blog1991 (12) TMI 261X X X X Extracts X X X X X X X X Extracts X X X X ..... ton Mills Ltd., Indian Rayon and Industries Ltd. and Tata Chemicals Limited, respectively. In substance the petitioners pray for declaration that the rate of tax on sales of lignite stands modified pro tanto to 4 per cent and the respondents be restrained from levying and collecting or recovering sales tax at the rate in excess of 4 per cent of the sale price. The petitioners have also prayed for the refund of the amount of sales tax levied in excess of 4 per cent with interest. 4.. As provided under entry 102 of Schedule II, Part A of the Gujarat Sales Tax Act, 1969 (for short "the local Act") lignite is subject to sales tax or purchase tax as the case may be at the rate of 10 paise in rupee. This entry has been inserted by the Gujarat Act No. 17 of 1981 and has come into force with effect from April 10, 1981. Entry No. 1, Schedule II, Part A of the local Act provides for levy of sales tax or purchase tax on coal in all its forms (excluding charcoal) at the rate of four paise in rupee. 5.. That the coal is declared goods of special importance in inter-State trade and commerce under section 14 of the Central Sales Tax Act, 1956. Thus by virtue of the provisions of section 15 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nite is entirely a different commodity and it cannot be said to be coal. Therefore, the provisions of sections 14 and 15 of the Central Act are not attracted. 7.. It is contended by Mr. Pathak, the learned counsel appearing for the petitioners, that in the year 1976, the Gujarat Mineral Development Corporation (for short "the GMDC") had made an application under section 62 of the local Act for determination of the rate of sales tax, on lignite. As provided under section 62 of the local Act the question can be referred to the Commissioner of Sales Tax as to whether any tax is payable in respect of a particular sale or purchase and if yes the rate at which the tax is payable. If such application is made, the Commissioner is required to pass order determining such questions. Such an application was made by GMDC together with invoice dated March 1, 1975, requesting to determine the rate of tax payable on sale or purchase of lignite. The Deputy Commissioner of Sales Tax had come to a conclusion that lignite should be treated as coal and therefore tax leviable would be at the rate of 4 per cent on the sale or purchase price of the lignite. 8.. The learned counsel Mr. Pathak has place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Again it may be noted that the determination order under section 62 of the local Act is nothing but classification of a particular commodity. The highest departmental authority decides the question as to whether the sale of a commodity is taxable and if so, at what rate. Thus it is nothing but a decision as regards the classification of the commodity and determination as to by which particular entry the sale of such commodity would be covered. Similar questions are being decided by the departmental authorities under the appropriate provisions of the Central Excises and Salt Act, 1944. In the context of the provisions of the Central Excises and Salt Act, 1944, the Supreme Court has held that the classification once made by the departmental authorities can be revised by the department itself. In the case of Plasmac Machine Manufacturing Co. Pvt. Ltd. v. Collector of Central Excise reported in [1992] 84 STC 107; AIR 1991 SC 999, it was, inter alia, contended before the Supreme Court that having earlier approved the article in question as falling under tariff item No. 68 (residuary entry), the department had no jurisdiction to revise the same. Repelling the contention, the Supreme Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to spontaneous combustion. Although there are thousands of square miles of lignite deposits in United States, little is mined because of these facts, its relatively small heat value, and its location far away from large industrial areas." On the basis of the aforesaid literature it is submitted that lignite must be taken as coal and it may be the coal of a lower rank. 12.. The aforesaid submission cannot be accepted. Here reference may be made to a decision of the Supreme Court in the case of Indo International Industries v. Commissioner of Sales Tax reported in [1981] 47 STC 359; AIR 1981 SC 1079. In that case the Supreme Court has laid down the principle as to how the item or entry in the statutes like Excise Tax Act or Sales Tax Act is to be interpreted. While doing so, the Supreme Court has observed: ".............. in interpreting items in statutes like the Excise Tax Acts or Sales Tax Acts, whose primary object is to raise revenue and for which purpose they classify diverse products, articles and substances, resort should be had not to the scientific and technical meaning of the terms or expressions used but to their popular meaning, that is to say, the meaning attach ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontention, reliance is placed on the decision of the Madras High Court in the case of Deputy Commissioner of Commercial Taxes v. B.R. Kuppuswami Chetty reported in [1980] 45 STC 308. The question before the Madras High Court was as to whether leco is a kind of coal within the meaning of section 14 of the Central Act. It is true that in this decision the Madras High Court held that leco is a kind of lignite which goes into the process of making lignite bricks and as lignite comes within the category of coal, leco was required to be classified as coal. However, this decision is based upon the dictionary meaning, Government circulars and Tribunal's decision. With utmost respect to the honourable Judges of the Madras High Court, it is difficult to persuade ourselves to agree with this decision. As laid down by the Supreme Court, we are required to adopt commercial parlance test or the popular parlance test while interpreting entries in taxing statute. We cannot adopt and prefer scientific or technical meaning. For the same reason, we are not in a position to agree with the decision of the Punjab and Haryana High Court in the case of Haryana Briquettes Industries v. State of Haryana rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pport of his contention Mr. Pathak has quoted the principle laid down by the Supreme Court in Atul Glass Industries (P.) Ltd. v. Collector of Central Excise [1986] 63 STC 322. In this decision after having carefully considered the process for the manufacture of glass mirrors from glass simpliciter, the Supreme Court has taken the view that the glass mirror cannot be accepted as glassware. The Supreme Court has noticed with due emphasis that after having undergone a certain process, the glass sheet becomes mirror and thereafter the mirror reflects, while the glassware does not. Thus adopting the principle of functional test the Supreme Court has said that glass mirror would not be glassware. Arguing in the same line, Mr. Pathak has urged that lignite is a substitute for and alternate of coal because both lignite and coal are fuel and mineral. The subsequent submission emerging from the same sought to be canvassed by Mr. Pathak is that therefore lignite also can be said to be the coal. But we feel that the facts before the Supreme Court in the abovesaid case law were entirely different. The glass sheet had undergone certain process by which the glass sheet was reflecting and it was b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s within the meaning of coal in the same section of the Act. It has been pointed out by the Patna High Court that this is so by legal fiction because in common parlance coke may not be understood as coal. Taking shelter under the abovesaid pronouncement of the Patna High Court Mr. Pathak has tried to urge, before us, that here in the instant petitions also, we should subscribe to the view that lignite would be coal because lignite is not a distinct subject-matter for taxation under the Central Act, and would fall within the meaning of coal under section 14 of the said Act. But as pointed out above in the abovesaid case the question was of coke and coal and not of lignite and coal. Viewing this case law from the said angle it becomes clear that the finding of the Patna High Court in the abovesaid decision cannot be taken as a persuasive factor, or guideline to come to the conclusion that lignite would be coal. 19.. From the abovesaid analysis of the contentions raised by Mr. Pathak before us it becomes clear that the view sought to be canvassed by the petitioners before us that lignite would be coal for the purpose of sections 14 and 15 of the Central Act cannot be accepted. 20. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and would abide by the decision of the Court. Thus in essence there is no submission either way on behalf of GMDC. 24.. Relying on the decision of the Supreme Court in the case of Modi Spinning and Weaving Mills Co. Ltd. v. Commissioner of Sales Tax [1965] 16 STC 310 and the decision in the case of Devi Dass Gopal Krishnan v. State of Punjab [1967] 20 STC 430, it is submitted by the learned counsel Mr. Pathak appearing for the petitioners that if the court comes to the conclusion that lignite is coal, this Court need not strike down the appropriate provisions of the local Act, but should hold that the pro tanto rate would stand modified and they are subject to the restrictions imposed under sections 14 and 15 of the Central Act. However, since we take the view that lignite is a different and separate commodity other than coal, it is not necessary to refer to these decisions in detail. In our view, there is no question of two possible views. We are of the opinion that only one view is possible and that lignite is a different commodity and it is not coal. Therefore, the reliance placed by Mr. Pathak on the decision of this Court in the case of Arvind Boards Paper Products Ltd. v. ..... 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