TMI Blog2018 (3) TMI 1326X X X X Extracts X X X X X X X X Extracts X X X X ..... er the VAT Act attracted 4% - decided in favor of Revenue. When this Court is called upon to decide the matter in terms of the substantial question of law, it has to decide the question as to what the law is and not on the basis of the treatment accorded to another dealer. There can be no scope for such consideration in revision which can be maintained only on the basis of substantial question of law. Revision dismissed. - Commercial Tax Revision No. 36, 37 of 2010 - - - Dated:- 9-3-2018 - Hon ble K.M. Joseph, C.J. And Hon ble Sharad Kumar Sharma, JJ. Mr. Surendra Kumar Posti, Advocate for the revisionist Mr. Mohit Maulekhi, Advocate for the respondent JUDGMENT K. M. Joseph, C.J. (Oral) These two Revisions are filed by the same assessee. CTR No. 36 of 2010 relates to the period 01.04.2005 to 30.09.2005, whereas, CTR No. 37 of 2010 relates to the period 01.10.2005 to 31.03.2006. It be noted that the period 01.10.2005 to 31.03.2006 is the period which was covered by the VAT Act. 2. The revisionist is running a shop. In the shop, the revisionist sells sweets, namkeen, samosa, milk and curd. For the first period of six months as aforesaid, the revisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed counsel for the revisionist, cooked food has got a connotation in law. It means food which one takes as a meal and when somebody orders for a meal, he would ordinarily not be satisfied with Samosa. These are all matters, which would be decided on the basis of common parlance/understanding. 6. He would also submit that in fact Samosa in respect of the adjoining shop, has been taxed @ 4% under the entry Sweets and Namkeen . 7. Per contra, the State representative, Mr. Mohit Maulekhi would submit that Namkeen is to be treated as cooked food. He would submit that the distinguishing feature of namkeen is that it has longer shelf-life, whereas, Samosa is an item which is to be consumed immediately. As far as rejection of accounts is concerned, he would submit that there was material to reject the same. 8. As far as the first question of law, which is raised is concerned, we are of the view that we cannot treat this as a question of law as such. 9. Then, there remains the second question as to whether the rate of tax on Samosa should be 8% or 5%. It is necessary to notice the relevant entries for the first period and the matter was governed by U.P. Trade Tax Act. The follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rate prescribed by a notification issued by the State Government for cooked food contending that 'cooked food' included 'biscuits' also. The notification relied on was one issued on October 6, 1971 under Sub-section (2) of Section 3-A of the Act in supersession of an earlier notification dated July 1, 1969. In both the notifications the tax was fixed at two per cent of the turn-over payable at all points of sale in the case of cooked food. The Assistant Commissioner (Tax Assessment) Sales Tax, Kanpur who was the assessing authority rejected the contention of the assessee that cooked food included biscuits also and imposed tax at the rate of three and a half per cent on the turn-over relating to biscuits treating the same as an unclassified commodity. An appeal filed against the order of the assessing authority before the Deputy Commissioner Sales Tax and a further appeal before the Judge (Appeal) Sales Tax, Lucknow were unsuccessful. The High Court of Allahabad also declined to interfere with the said order. This appeal by special leave is filed against the order of the High Court under Article 136 of the Constitution. The only ground urged before us is that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . That oil had to be heated. There was certain process required to be applied before 'fryums' become consumable. In these circumstances the item 'fryums' in the present case will not fall within the term 'cooked food' under Item 2 Part I of Schedule II to the 1994 Act. It will fall under the residuary item all other goods not included in any part of Schedule I . 13. In Bharat Co-operative Bank (Mumbai) Ltd. v. Co-operative Bank Employees Union, 2007 4 SCC 685, this Court has held that when the word 'includes' is used in the definition, as is the case under Section 2(g) of the 1994 Act, the legislature does not intend to restrict the definition; it makes the definition enumerative and not exhaustive, that is to say, the term defined will retain its ordinary meaning but its scope would be extended to bring within the term certain matters which in its ordinary meaning may or may not comprise. Applying the above test to the term 'cooked food' in Section 2(g) of the 1994 Act we find that the said term uses the word 'includes' in the definition. The said term 'cooked food' makes the definition enumerative when it includes wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nfectionery. 17. In another case of Gulati and Company Vs. Commissioner of Sales Tax, Uttar Pradesh, Lucknow reported in (2014) 14 SCC 286, the question arose as to whether food colours are to be treated as foodstuff. The Hon ble Apex Court, after considering the case law, held inter alia as follows :- 16. It is trite that there is no fixed test for classification of a taxable commodity and the most commonly employed is the common parlance test . Whether a particular article will fall within a particular tariff heading or not has to be decided on the basis of the tangible material or evidence to determine how such an article is understood in common parlance or in its popular sense meaning. That is to say, comprehending the term in same context as those who are concerned with it and it is that the sense in which they understand it that constitutes the definitive index of the legislative intention, when the statute was enacted. (A. Nagaraju Bros. v. State of A.P.: 1994 Supp (3) SCC 122; Delhi Cloth and General Mills Co. Ltd. v. State of Rajasthan: (1996) 2 SCC 449; CCE v. Wockhardt Life Sciences Ltd.) 17. The use of common parlance test and its advantage over the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he claim of the Assessee that food colours and food essences are foodstuffs within the meaning of the notification was rightly rejected by the High Court upsetting the view expressed by the Tribunal. 18. Now, we may notice a few decisions of the High Courts in this regard. In the case of Commissioner of Sales Tax, M.P. Indore Vs. Gyanmal Kesharichand reported in (1984) 55 STC 140, the question arose as to whether ice-cream and ice-candy are cooked food under the Madhya Pradesh General Sales Tax Act, 1958. The Full Bench of the Madya Pradesh High Court, after elaborate consideration, took the view that ice-cream and icecandy are not cooked food. The Full Bench held as under :- 17. It is a matter of common knowledge that ice-cream and ice-candy are items of wide consumption in the country by people of all strata in the society and neither the merchants dealing in these items nor the consumers in general sell or purchase it as cooked food . We quote with approval the observations of the Division Bench of this Court in Commissioner of Sales Tax v. Shri Ballabhdas Ishwardas [1968] 21 STC 309: But in common parlance 'cooked food' means those th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its changed form the legislature meant to cover those articles which are made fit for eating by a heating process as boiling, roasting or baking. We do not agree with this sweeping interpretation of the entry. We have already held in the preceding paragraph relying on the Supreme Court decisions that for interpreting items in sales tax statute the mode of preparation or the scientific or technical sense meaning has not to be applied. It is the popular sense or common parlance meaning that has to be ascribed. 19. In the case of Commissioner of Sales Tax, U.P., Lucknow Vs. M/s Ram Bhandar, Thatheri Bazar, Varanasi reported in (1981) UPTC 454, the learned Single Judge had to deal with the controversy as to whether namkin was to be taxed as cooked food upto 30.11.1979 or as an unclassified item. In this regard, the learned Single Judge proceeded to lay down as under :- 7. It would not be rather necessary to mention the legislative history of this entry. Suffice it to say that upto 13th June, 1969, the entry was cooked food (including sweetmeats and confectionery other than that sold in sealed tinned containers. Thereafter cooked food was separated and remained so du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urs. 8. This decision, in my opinion, clearly meets the argument urged by Sri Gularti that the expression cooked food is of wider import and would include cooked meals and of course cooked meals are taken at regular meal taken at regular meal hours but there are some other items also, for instance, Namkin which are also taken at regular meal hours and that being so, though Namkin may not be a cooked meal but certainly it is a cooked food. In my opinion Namkin like biscuits cannot be regarded as sufficient to maintain life and growth and to supply proper nourishment to the body. No one would normally dream of living on Namkin only day in and day out without getting diseases flowing from malnutrition and undernourishment. 9. Reliance was placed by Sri Gulati on a latter decision of the Madhya Pradesh High Court in the case of Commissioner of Sales Tax v. India Coffee Workers Co-operative Society Ltd., (1970) 25 STC 43. In that case the question for consideration was as to what is the correct interpretation of the word meal occurring in subitem (b) of Item 9 of Schedule I of the Madhya Pradesh General Sales Tax Act, 1958, and whether the sale of one or more articles of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in (1979) 44 STC 326. Following the judgment of the Hon ble Apex Court reported in (1978) 41 STC 394, the learned Single Judge proceeded to hold that Lal (puffed rice obtained by parching) and chura (made by flattening rice) are different forms of rice so as to fall under the category of foodgrain and not under the category of cooked food. 21. In Pappu Sweets and Biscuits and Another vs. Commissioner of Trade Tax, U.P. Lucknow reported in 1998 (7) SCC 228, the question arose as to whether toffee is sweetmeat, namkin, rewari, gazak and commodities of like nature. The question arose in the following fashion :- There was an exemption notification granted by the Government under the U.P. Sales Tax Act, 1948, by which, tax concessions were granted to new industrial units other than those making sweetmeat, namkin, rewari, gazak and commodities of like nature. The Court proceeded to take the view that toffee cannot be treated as sweetmeat. In proceeding to hold so, the Court inter alia has referred to the dictionary meaning and thereafter proceeded to hold as follows:- 8. It is true that the dictionary meaning of the word sweetmeat is very wide and any food which is sweet and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gard to the word cooked food , it is an expression which is to be understood in the context of the statute concerned. 23. As for instance, we have noticed the decision of the Hon ble Apex Court under the Madhya Pradesh Act. In the said Act, cooked food included sweetmeats and other items, whereas, in the statute with which we are concerned, we are faced with the question in the context of different entries, namely, cooked food inter alia among other items and a separate entry for sweetmeats and namkeen inter alia. Therefore, the legislative intention is clearly to tax cooked food on the one hand and sweetmeats and namkeen as different items. Cooked food is taxed at a higher rate under the statute in question, as compared to sweetmeats and namkeen. There cannot be any generalization and the Court would necessarily have to find assistance of the statute, in question. 24. It is also true, as has been laid down by the Hon ble Apex Court in the case of Annapurna Biscuit Manufacturing Co. (Supra), as also the judgment of the learned Single Judge in Commissioner of Sales Tax, U.P., Lucknow (Supra) that the concept of cooked food need not mean that every form of cooked food within t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is ready to be eaten and it is ordinarily consumed without much delay from the time when it is cooked. Ordinarily, it is meant to be so consumed. Learned representative of the State urges before us the distinction between namkeen and samosa to be that namkeens have larger longer shelflife, the products which can be consumed even over a long period of time perhaps by addition of requisite preservatives. 28. In this context, we are handicapped by one aspect. In none of the orders, be it the order of the Assessing Officer or the First Appellate Authority or the Tribunal, there is any reference to this question. While it is true that the assessee has raised a ground that samosa is to be taxed at 5% and not at 8%, there is no expatiation of the ground as to what would be the basis. What is more, in none of the orders which have been issued, the same has been discussed by any of the authorities. It may be true that the grounds have been taken; but if the grounds are not pressed before the authorities, the authorities may not feel obliged to deal with the contentions which are raised. There is no finding rendered in fact by any of the authorities in this regard. In fact, there is no m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 12 (2) of the Act mandates the dealer to maintain stock-books in respect of raw materials as well as product obtained at every stage of production. If such a stock-book is not maintained, it leads to the conclusion that the account books are not reliable or that particulars are not properly verifiable. If the account books are rejected, the turnover has to be determined to the best of judgment of the assessing authority concerned. We are unable to uphold the view that a defect in non-maintenance of stock register is only technical and so the turnover disclosed in the account books should be accepted. 33. Therefore, the Apex Court did not find favour with the finding of the High Court that the defect of not maintaining of manufacturing account is of technical nature and found that it is a matter of great importance in the case of a manufacturer. No doubt, the revisionist has relied on the case of M/s Devi Charan Sri Mohan Dass Kadamtar, Mirzaur Vs. Commissioner of Sales Tax, U.P. reported in (1973) UPTC 519. The Division Bench has held as follows :- The Revision Authority seems to be of the view that account books have necessarily to be rejected and turnover to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hancement in the circumstances is absolutely arbitrary and without any materials. 34. We notice, however, that the Division Bench decision dated 6th August, 1973, is much before the judgment of the Hon ble Apex Court. 35. Secondly, we may notice, in fact, in this case the accounts were not found acceptable. We do not think that the revisionist can contest this having regard to the facts of this case and particularly having regard to the number of employees who are engaged. 36. The learned counsel for the revisionist made a complaint that the adjoining shop owner has a much bigger shop dealing with the same product and he has been assessed at a lower rate. We do not think that this will give rise to a substantial question of law as is understood in law. The fact that samosa made in the said shop has been assessed at the rate as applicable to namkeen cannot possibly colour our understanding of the entry in law. 37. When this Court is called upon to decide the matter in terms of the substantial question of law, it has to decide the question as to what the law is and not on the basis of the treatment accorded to another dealer. There can be no scope for such consideratio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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