TMI Blog2021 (3) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... rinciple of judicial proposition that when there are no definition provided in the statute book, recourse will have to be taken to derive the meaning/attribute from the common parlance as understood in the trade concerned. In order to do that it will be necessary to examine how a cycle and a cycle rickshaw is understood in common parlance as trade. As the said items are not defined in AVAT Act 2003, recourse will have to be taken to the dictionary meanings provided, in order to to make an attempt to determine the Legislative intent that can be attributed to the expression parts thereof . Taking recourse to the doctrine of common parlance it can be accepted that cycle/bicycle which is ordinarily sold in the market comes with all accessories/parts like handle, brakes, mudguards, paddles, bell and seat etc. In common parlance unless the cycle/bicycle is fitted with such items, it is unlikely to be purchased by customer. In other words when a customer comes to the market to purchase a cycle/bicycle, the cycle comes with such necessary parts/fittings enabling a customer to make use of the cycle immediately after purchase without having to fit any other parts in order to effect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have to be declared to be erroneous. In view of the fact that besides the lack of factual details necessary to arrive at such a finding by the Commissioner of Taxes it is also noticed that the Commissioner of Taxes being an authority declared under the AVAT Act, 2003, has brought in or made use of the term accessories which is alien to Entry 12 itself of the AVAT Act, 2003. The Commissioner of Taxes being an authority declared under the AVAT Act, 2003 cannot bring any term/expression to decide upon the question of imposition of rate of tax without there being any reference/definition provided for, such item(s)/expression(s) in the Act by the Legislature. The finding arrived at by the Commissioner of Taxes that the items in issue relating to Entry 12 of AVAT Act, 2003 are 'accessories' is contrary to the settled provisions of law. It is also well settled in law that taxing statute must be interpreted in the light of what is fairly expressed. Importation of provision into taxing statute to supply any assumes deficiency is not permissible. The impugned order dated 10-07-2013 passed by the Commissioner of Taxes under section 105 of Assam Value Added Tax Act, 2003 has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is in respect of 2010-11. The clarificatory order dated 10-07-2013 passed by the Commissioner of Taxes by which it was clarified that Cycle Seat Cover and Cycle lock are not covered by Entry 12, is also assailed in both the writ petitions. 2. The petitioner is a partnership firm and carrying on business as a dealer of cycle, spares and accessories, cycle tyre and tubes. The petitioner is represented by Sri Hardeep Singh, who is one of the partners of the partnership firm. The petitioner states that it is a registered dealer under the Assam Value Added Tax Act, 2003 as well as Central Sales Tax bearing registration Nos. TIN 18520002963 and 18069906417 respectively. 3. That for the assessment year 2009-10 on the sales cycle fluids/lubricants, seat cover and cycle lock , the petitioner was assessed to tax @ 12.5% up to 31-10-2009 and @ 13.5% from 31st October, 2009 to March, 2010. Similarly for the assessment year 2010-11 on the sales of items cycle fluids/lubricants, seat cover and cycle locks the assessee was assessed to tax 13.5%. 4. The challenge to the clarificatory order dated 10-07-2013, the assessment orders dated 20-07-2013 and the revisional order dated 02-05 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... writ petition. 6. The department filed its affidavit in WP(C) No. 3380/2015 whereby they had disputed the claim of the petitioner and defended the clarificatory order dated 10-07-2013 passed by the Commissioner of Taxes and the assessment orders passed. 7. The learned counsel appearing for the department craved leave of this Court refer to and rely upon the affidavit filed in WP(C) No. 3380/2015 in respect of WP(C)/3382/2015 also. 8. In order to delve into the disputes raised by the parties it is necessary to refer the relevant provisions of the Assam Value Added Tax Act, 2003. Under section 10 of the AVAT Act, 2003 the levy of tax on sales in respect of the goods will be at the rates provided therefore in the Schedules appended to the Act. In respect of the goods in question namely, 'cycle seat cover' and 'cycle-lock' a reference will have to be made to the relevant Schedule provided for. Entry 12 of Schedule-II, Part A of the Assam Value Added Tax Act, 2003 (hereinafter referred to as the AVAT Act of 2003) is the entry which provides for the rate of tax to be levied on Bicycle, Tricycle, Cycle Rickshaw and Tubes and Tyres parts thereof and used for Bicy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1989) 3 SCC 677:- This judgment is relied upon to contend that there must be a reasonable nexus between the taxing power and the subject of the tax and the actual measure of tax. The Entries should not be read in a narrow in pedantic sense but must be given their fullest meaning and widest amplitude and be held to extend to all ancillary and subsidiary matters which can fairly and reasonably to set to be comprehended in them. (ii) Goa Auto Accessories Ltd., Panaji v. Commissioner of Sales Tax, Goa another:- For the proposition that items which are manufactured and not used as a replacement and cannot be used in other items/vehicles except for the purpose which they are manufactured. (iii) CIT v. Kulu Valley Transport Co. (P) Ltd., (1970) 2 SCC 192:- For the proposition that where two views are possible while interpreting a taxing statute, the view in support of the assessee should be accepted. (iv) Indo-Japanese Industries Ltd. vs. Assistant Collector:- For the proposition that an item that is manufactured specifically for a particular use will have to be considered to be a part of the said item and cannot be excluded from the purview of that item. It will have to be c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (cycle frame lock), cycle seat cover and cycle oil grease under the Assam Value Added Tax Act, 2003. Shri V.K. Sureka, Tax Consultant and Authorized Representative and Shri S.K. Sureka, Advocate appeared on behalf of the association and filed submission. They submitted that the items cycle lock and cycle seat cover is only meant for use in cycle and it has no other use. Therefore these are very much parts of bicycle. Further cycle oil and grease is used for bicycles, tricycles and therefore said items are covered by entry Sl. No. 12 of Second Schedule (Part-I) attached to the Assam Value Added Tax Act, 2003. They have also furnished several citations of Court orders which are perused. The entry at serial number 12 of the Part-A of second Schedule to Assam Value Added Tax Act, 2003 reads as Bicycles, tricycles, cycle rickshaws and parts thereof and tyres and tubes used for bicycle, tricycle, cycle rickshaw and wheel chair , It appears that parts of cycles are taxable @ 5% as per said entry. However, cycle lock and cycle seat cover are regarded as parts of cycle as they are not essential part of cycle without which the cycle cannot be operated. They are accessories to cycle. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt. It is well settled principle of judicial proposition that when there are no definition provided in the statute book, recourse will have to be taken to derive the meaning/attribute from the common parlance as understood in the trade concerned. In order to do that it will be necessary to examine how a cycle and a cycle rickshaw is understood in common parlance as trade. As the said items are not defined in AVAT Act 2003, recourse will have to be taken to the dictionary meanings provided, in order to to make an attempt to determine the Legislative intent that can be attributed to the expression parts thereof . 16. (i) According to Encyclopaedia Britannica the meaning provided for Bicycle and Rickshaw are as under:- Bicycle:- Bicycling is a simple, affordable and energy-efficient means of transportation. Of all human-powered locomotion, it is the fastest and least energy-demanding. Rickshaw:- (from Japanese: human-powered vehicle ), two-wheeled vehicle with a doorless, chair like body and a collapsible hood, which holds one or two passengers and is drawn by a man between two shafts. It was used widely in the Orient but was largely superseded by the pedicab, a ricksha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Bicycle before it can be effectively used. Viewed from this perspective the expression parts thereof used by the Legislature in Entry 12, will be rendered redundant in respect of Bicycle/Tricycle unless the term parts thereof can be permitted to be used to mean and include the term accessories as used by the Commissioner of Taxes. For the purpose of rendering the term parts thereof meaningful in respect of all the items in Entry 12 including Bicycle and Tricycle, the term accessories must be understood to be included within the expression parts thereof . 18. Alternatively, if the use of the expression parts thereof is to be understood to be relative only to the item cycle rickshaw and not to the other items mentioned in the Entry-12, then the parts which are to be used in order to make a cycle rickshaw suitable for use by the customer will also have to be taxed at the rate prescribed in Entry-12. It is possible that Legislature intended to use the expression parts thereof only in respect of 'cycle rickshaw' as because again under the common parlance theory, the sellers/traders like the petitioner are ordinarily found to the selling/trading only in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the strict or technical meaning of the language contained in it, but is to be construed in its popular sense, meaning, of course, by the words popular sense that which people conversant with the subject-matter with which the statute is dealing would attribute to it. The ordinary words in everyday use are, therefore, to be construed according to their popular sense. The same view was reiterated by Story, J. in 200 Chests of Tea [(1824) 9 Wheaton US 435, 438] where he observed that the legislature does not suppose our merchants to be naturalists, or geologists, or botanists. See the observations of Bhagwati, J. as the learned Chief Justice then was, in Porritts Spencer (Asia) Ltd. v. State of Haryana [ (1979) 1 SCC 82 : 1979 SCC (Tax) 38]. But there is a word of caution that has to be borne in mind in this connection, the words must be understood in popular sense, that is to say, these must be confined to the words used in a particular statute and then if in respect of that particular items, as artificial definition is given in the sense that a special meaning is attached to particular words in the statute then the ordinary sense or dictionary meaning would not be applicable but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n view of these circumstances we cannot hold that Section 3(a) of the Central Sales Tax Act was redundant or would apply to contingencies which may not happen at all . (emphasis supplied). 21. The said view is reiterated by the Apex Court in the case of Bansal Wire Industries reported in (2011) 6 SCC 545. In this case, the Apex Court held that in taxing statute nothing is to be read in or implied, one can look sale as the language use. There is no room for any intendment. 29. It is a settled principle of law that the words used in the section, rule or notification should not be rendered redundant and should be given effect to. It is also one of the cardinal principles of interpretation of any statute that some meaning must be given to the words used in the section. The expression wire rods and wires which is mentioned in Entry (xv) would not and cannot cover the expression tools, alloy and special steels of Entry (ix) nor would it refer to the expression iron and steel as each item used in Entries (ix) and (xv) are independent items not depending on each other at all as has been held in Pyare Lal Malhotra [ (1976) 1 SCC 834 : 1976 SCC (Tax) 102]. 30. In arriving a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he respondents that the language of the various provisions under the statues which were under consideration, are different from the language used in the present statute namely, Entry 12, Schedule-II, Part-A of the AVAT Act, 2003. In Entry 12 in the present proceeding, the statute does not use the term 'accessories', although the same is used in some of the other entries under the same Schedule. Similarly in Entry 19 and Entry 65 and 96 of the said Schedule II Part B, the term attachment is also used. Since the present issue pertains to a dispute as to whether the levy of tax should be under Entry 12, Schedule-II, Part A or under Entry-1 of Schedule-V, the interpretation will have to be confined to the language by the Legislature used for Entry 12 under Schedule-II Part-A. Under the circumstances the judgments relied upon by the respondents are distinguishable on facts. 24. As regards the authorities relied upon by the petitioner, the judgment of the Apex Court in the case of MCDOWELL AND COMPANY LIMITED is on the aspect of Ejusdem generis which is not relevant in the facts of the present case. The doctrine of Ejusdem generis in that judgment is used in the context ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lying cases relating to entries which are so very different and could have only a very remote bearing, if any, upon any reasoning which could be adopted to support the submission that the are carbons, under consideration here, fall within the relevant Entry 4 of Schedule I of the Act. The meaning to this entry can only be satisfactorily determined in the light of the language of the entry itself considered in the context in which it occurs. 7. The Entry 4 occurs in a schedule in which descriptions of goods to be taxed indicate that the expression required for use therewith has been employed for equipment or accessories connected with the main purpose. For instance, in Entry 5 the expression occurs at the end as follows: Photographic and other cameras and enlargers, films and plates, paper and cloth and other parts and accessories required for use therewith. Apparently, the deciding factor is the predominant or ordinary purpose or use. It is not enough to show that the article can be put to other uses also. It is its general or predominant user which seems to determine the category in which an article will fall. 25. In view of the discussions and in view of the fact th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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