TMI Blog2008 (7) TMI 876X X X X Extracts X X X X X X X X Extracts X X X X ..... al ash) being a different commodity from its parent coal. The said decision is accordingly overruled only insofar as it holds that cinder is not coal. - Writ Appeal Nos. 346 of 2006 & 99 of 2007 - - - Dated:- 31-7-2008 - PATNAIK A.K. C.J. AND KULSHRESTHA S.K. AND SAPRE A.M. AND VINEY MITTAL AND SHANTANU KEMKAR , JJ. ORDER:- The order of the court was made by S.K. KULSHRESTHA J. The Division Bench while considering the appeal of the State Government against the Order dated May 4, 2006, passed by the learned single judge in Writ Petition No. 1169 of 2004, has referred the following question for consideration of the larger Bench in view of the cleavage of opinion between decisions rendered by the Full Bench, the Division Bench and the single Bench: Whether coal ash is a part of cinder and covered by the term 'coal' in entry No. 22 in Part V of Schedule II of the Commercial Tax Act or the said commodity would be taxable under entry 39 in Part IV ? Initially a three-judge Bench was constituted to consider the said question, but the Bench on being apprised that the question also involves the legality of the decision of the Full Bench in Hukumchand Mills Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, taxed under the residuary clause. Reference was also made to the decision of the Full Bench of this court in Hukumchand Mills Ltd. v. Commissioner of Sales Tax [1988] 71 STC 101 and Kalyan Mills v. Commissioner of Commercial Tax [1999] 32 VKN 212 to the effect that coal ash of Nepa Limited Company is a bye-product of coal and will be taxed under entry 39 of Part IV of Schedule II of the M.P. Commercial Tax Act, 1994. The State counsel, however, pointed out that the judgment in Kalyan Mills [1999] 32 VKN 212 strongly relied upon by the learned single judge was of the Board of Revenue and the other cases, namely, S. Kumar Ltd. v. Additional Commissioner of Sales Tax [2007] 6 VST 412 (MP); [2004] 4 STJ 785 (MP) and Commissioner of Sales Tax v. Modi Spinning Weaving Mills, Modinagar [2008] 11 VST 259 (All); [2004] 4 STJ 689 (All) expressing that coal ash was different from coal because coal is a mineral, clearly subscribed to the view of the said Full Bench decision in Hukumchand Mills [1988] 71 STC 101 (MP). It was stated that in view of the decision of the Full Bench which clinches the issue, there was no room for speculation about the position of the coal ash and its taxabil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... December 23, 1969 [1972] 29 STC 418 (MP) [App]. In the case of Samrathmal Dhoolchand M.C.C. No. 253 of 1967 decided on December 23, 1969 [1972] 29 STC 418 (MP) [App], the question considered by the Division Bench was as to whether coal ash is coal and comes under entry No. 1, Part III of Schedule II of the Act or whether it comes under Part VI of Schedule II of the 1958 Act. It was conceded before the Bench that coal-ash is called cinder in commercial parlance and in view of the dictionary meaning given by Webster, cinder being a piece of partly burnt coal capable of further burning without flame, and being partly burnt combustible, the entry would include coal ash. We find it pertinent to point out that in the judgment rendered in Hukumchand Mills [1988] 71 STC 101 (MP)[FB] these decisions have not been considered. In Hukumchand Mills [1988] 71 STC 101 (MP)[FB], the primary question that was mooted before the court was as to whether the Tribunal was right in holding that unserviceable items of stores which comprised discarded assets like scrap, dyes, chemicals, broken iron hoops, obsolete machinery, coal ash, etc., were exigible to tax? It is, therefore, clear that the ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law. If the case is not covered within the four corners of the provisions of the taxing statute, no tax can be imposed by inference or by any analogy or by trying to probe into the intentions of the Legislature and by considering what was the substance of the matter. Since the above judgment is of the Constitutional Bench, we find it apt to remain within the framework laid down therein for interpreting the entry in question. In Saraswati Sugar Mills v. Haryana State Board AIR 1992 SC 224, while considering whether sugarcane is vegetable, it was observed that one has to look merely at what is clearly said. There is no room for any intendment and there is no room for bringing within the provision of the Act anything by implication. The discussion in paragraph 21 of the said report, reads as follows: 21. Construction of words and the meaning to be given for such words shall normally depend on the nature, scope and purpose of the statute in which it is occurring and to the fitness of the matter to the statute. The meaning given to the same word occurring in a social security measure or a regulating enactment may not be apposite or appropriate when the same word is interpreted w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... intent which is not reflected by the entry concerned, unless there is an apparent ambiguity, the contention of the learned amicus curiae, Mr. G.M. Chaphekar, Senior Advocate, per contra, is that the common sense cannot be abdicated and the article should be considered as known in commercial world and in common parlance. We are conscious of the fact that if the entry is wide enough to embrace various other articles and the same is identified as such in the commercial world, it can safely be inferred that in providing for coal and coke and even while excluding charcoal , as was the case under the repealed Act, the court can come to the conclusion that the expression coal would include charcoal/cinder . It is in this context that now we proceed to examine other decisions to come to the conclusion with regard to the exigibility of tax of coal ash/cinder under entry 22 or under entry 39 (residuary). We have referred to the entry under the erstwhile M.P. General Sales Tax Act, 1958 and the M.P. Commercial Tax Act, 1994. In order to appreciate the legal position, we may refer to the case of the Full Bench of this court in Hukumchand Mills [1988] 71 STC 101. As already pointe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he conclusion that entry 97(b) was the specific entry and that entry 90 was the general entry. Such an interpretation goes against the express language of the two entries. (emphasis Here italicised. supplied) In Commissioner of Sales Tax, Madhya Pradesh v. Jaswant Singh Charan Singh [1966] 17 STC 527, a Division Bench of this court, comprising P.V. Dixit, C.J. and K.L. Pandey, J. ruled that the word coal occurring in a fiscal statute has to be understood in its popular and commercial sense. The word 'coal' as used in commerce, includes charcoal and, therefore, charcoal is covered by entry No. 1 of Part III of Schedule II. It was observed in paragraph 3 of the Report as follows: 3. There is no doubt that the word 'coal' as originally understood in England was sufficiently wide to include charcoal. But there its use in that sense has become obsolete. The usual sense in which it is now used connotes a firm, brittle (generally black) carbonaceous rock derived from mines. This will be clear from any standard dictionary. The Board has referred to the Blackies' Concise Dictionary. We may mention the Chamber's Twentieth Century Dictionary which gives the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erce. One of these is 'coal including coke in all its forms'. Section 15 of that Act provides that the State Legislatures in their respective sales tax laws can impose only two per cent tax on these goods. That is why in entry 1 of Part III 'coal' is stated to include 'coke in all its forms' and coal including coke in all its forms is charged at two per cent tax. The State Legislature, however, knew or must be presumed to know that firewood is also used by the people as fuel, but would not fall within that entry, and, therefore, provided two per cent tax on it by a separate entry, namely, entry 8 in Part III. Having taxed coal and firewood at two per cent, it does not appear to be possible that the Legislature deliberately left out charcoal from the connotation of the word 'coal' and left it to be charged at four per cent under the residuary entry 1 in Part VI. The object of the Legislature clearly was to tax coal and firewood as articles used as fuel and did not make a separate entry in regard to charcoal as it must be aware that coal, as understood in ordinary and commercial sense, would include charcoal. Had that not been so, instead of leaving ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rial used for the same purpose and having same properties, more or less, main being mixed carbon, volatile matters, ash and moisture'. A crucial question that has been raised by the learned Advocate-General is based on the decision of I.T.C. Bhadrachalam Paperboards Limited v. State of Andhra Pradesh [1999] 114 STC 58 (AP) on which heavy reliance has been placed by the Revenue. Though in answering question No. 1, the honourable Andhra Pradesh High Court has come to the conclusion that coal ash (cinder) is a different commodity and would, therefore, be exigible to sales tax, with respect, it is only with regard to question Nos. 2 and 3 that the matter was considered from different perspective. It is clear that what was agitated before the honourable High Court was whether coal ash was a product of the petitioner's industrial unit and whether the sale of coal ash by the petitioner was eligible for exemption under G.O. Ms. No. 606 dated April 9, 1981. It was contended by the Revenue that the petitioner-company was purchasing kiln and using it as raw material for its manufacturing activity but not as fuel which had found favour with the Tribunal against which revision was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used in other activities as a fuel for heating/burning. Since properties are retained, which may not be the case as considered by the Supreme Court in ITC Bhadrachalam Paper Boards Ltd. [2002] 126 STC 541, we are of the view that the case relating to the exemption under the Andhra Pradesh General Sales Tax Act has no bearing over the subject-matter before us. The perspective from which the case was considered was as to whether cinder was a product of the company entitled to exemption. We may now digress to consider parallel examples contained in relation to the other goods. The Supreme Court in Commissioner of Sales Tax, U.P. v. Lal Kunwa Stone Crusher (P.) Ltd. [2000] 118 STC 287; [2006] 8 STJ 658 has ruled that stone gitti (metal) being smaller article of stone, cannot be treated separately. In view of the said decision and perception that smaller articles of the same article cannot be treated differently, we are of the view that coal ash/cinder, by whatever name called in commercial world and in common parlance, being smaller pieces of coal, retaining the properties of the coal and used as coal in other commercial activities, cannot be denuded of its original properties ..... X X X X Extracts X X X X X X X X Extracts X X X X
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