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Commissioner of Sales Tax Vs. Zeal and Company - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtMumbai High Court
Decided On
Case NumberSales Tax Reference No. 17 of 1969
Judge
Reported in[1975]35STC486(Bom)
ActsBombay Sales Tax Act, 1959 - Sections 52(1) and 61(1)
AppellantCommissioner of Sales Tax
RespondentZeal and Company
Appellant AdvocateM.H. Shah, Adv.
Respondent AdvocateR.V. Patel, Adv.
Excerpt:
sales tax - interpretation - section 52 (1) of bombay sales tax act, 1959 - taxability of tamarind powder - entry 12 of act covers tamarind whole or powdered - it is not necessary that tamarind powder should be made from whole tamarind - powder made out of skin or seeds or both come within entry 12 of act. - - shah's case that the pulp of the tamarind fruit cannot be powdered, we fail to see how it helps mr. if, therefore, when the word 'groundnut' is used its kernel is included, and if the word 'cashew' is used, its kernel is also included, we fail to see why when the word 'tamarind' is used, its seeds should not be included, particularly when it is the case of the department itself that the only parts of the tamarind which can be powdered are either the seeds or the skin......tamarind, in order to qualify for exemption, should be the entire fruit, including its skin and seeds powdered and sold. at the same time mr. shah conceded that the pulp of the tamarind fruit by itself cannot be powdered. this was also the position taken up by the department before the tribunal. the tribunal, however, came to the conclusion that the possibility of even the pulp being powdered cannot be ruled out and stated that there were instances of commodities of the type of tamarind pulp, which were dehydrated and powdered. mr. shah submitted that the tribunal was not justified in coming to the conclusion that there were possibilities of even the pulp being powdered without there being any evidence in respect thereof before the tribunal. it is unnecessary to consider the.....
Judgment:

Madon, J.

1. In this reference under section 61(1) of the Bombay Sales Tax Act, 1959, the following question has been submitted to us for our determination :

'Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the sale effected under Bill No. 1972 dated 17th November, 1964, of tamarind seed powder was covered by entry 12 of Schedule A appended to the Bombay Sales Tax Act, 1959, and as such exempt from payment of any tax ?'

2. This question arose out of an application made by the respondents to the Commissioner of Sales Tax under section 52(1) of the said Act requesting the Commissioner of Sales Tax to determine whether tamarind seed powder feel under the said entry. Along with the said application the respondents enclosed their Bill No. 1972 dated 17th November, 1964, for the sale of a certain quantity of tamarind seed powder by them to their customer. The Commissioner of Sales Tax held that it fell under the residuary entry No. 22 in Schedule E to the said Act. In appeal the Tribunal allowed the appeal and held that tamarind seed powder fell under entry No. 12 of the said Schedule A. The said entry No. 12 provides as follows :

----------------------------------------------------------------------- 'Serial No. Description of goods Conditions and exceptions subject to which exemption is granted ------------------------------------------------------------------------ 12. Chillies, chilly powder; tamarind Except when sold in and turmeric, whole or powdered. sealed containers.' -----------------------------------------------------------------------

3. Before the Tribunal it was contended that the words 'whole or powdered' went with turmeric and not with tamarind. This contention was rejected by the Tribunal in view of the fact that the punctuation mark, comma, occurred after 'turmeric' and not 'tamarind'. Before us, however, Mr. Shah, the learned counsel for the applicant, has not sought to raise this contention. What Mr. Shah has, however, contended is that tamarind means the pulp, the seeds and the skin of the tamarind and, therefore, powdered tamarind, in order to qualify for exemption, should be the entire fruit, including its skin and seeds powdered and sold. At the same time Mr. Shah conceded that the pulp of the tamarind fruit by itself cannot be powdered. This was also the position taken up by the department before the Tribunal. The Tribunal, however, came to the conclusion that the possibility of even the pulp being powdered cannot be ruled out and stated that there were instances of commodities of the type of tamarind pulp, which were dehydrated and powdered. Mr. Shah submitted that the Tribunal was not justified in coming to the conclusion that there were possibilities of even the pulp being powdered without there being any evidence in respect thereof before the Tribunal. It is unnecessary to consider the correctness of what the Tribunal has opined, because accepting Mr. Shah's case that the pulp of the tamarind fruit cannot be powdered, we fail to see how it helps Mr. Shah. According to Mr. Shah, what can be powdered is only the skin and the seeds of the tamarind fruit. If, therefore, when the entry uses the words 'tamarind' 'whole or powdered', tamarind can only refer to those parts of the tamarind fruit, which can be powdered, namely, either the skin or seeds or both, and this would militate against Mr. Shah's argument that in order to qualify for exemption, it must be the entire tamarind, including the pulp, which must be powdered. In support of his submission that tamarind cannot include tamarind seeds, Mr. Shah relied upon a decision of the Madras High Court in Indian Leaf Tobacco Development Co. Ltd. v. State of Madras (now Andhra) [1954] 5 S.T.C. 354. Section 4 of the Madras General Sales Tax Act, 1939, exempted from the operation of the Act sale of tobacco in any form, whether manufactured or not. In that case a question arose whether tobacco seed was included in the exemption granted by the said section 4. The Tribunal held that tobacco seed was a commodity distinct from tobacco and did not come within the scope of the said section 4. The Madras High Court agreed with the view taken by the Tribunal. No reasons for arriving at this decision are mentioned in the said judgment. It, however, appears to us that tobacco is something very different from tobacco seed. In commercial parlance tobacco would mean tobacco leaves or powdered tobacco leaves and will not include tobacco seeds. A man who wants to purchase tobacco for filling his pipe in order to smoke his pipe or to roll a cigarette, when he goes to a tobacconist and asks for tobacco, is not asking for tobacco seeds or a tobacco plant but either for tobacco leaves or for powdered tobacco leaves. In our opinion, this judgment, therefore, does not in any way help the applicant's case.

4. Mr. Patel, the learned counsel for the respondents, has, on the other hand, referred us to decision of the Kerala High Court in Swasti Cashew Industries Private Ltd. v. State of Kerala [1961] 12 S.T.C. 691. In that case the question was whether, when rule 4(2)(c) of the Madras General Sales Tax (Turnover and Assessment) Rules, 1939, 'imposed a tax on the sale of cashew', it included cashew kernel. Following the decisions of the Andhra Pradesh High Court in Motilal Hariprasad and Brother v. State of Andhra [1955] 6 S.T.C. 654 and [1959] 10 S.T.C. 20 and Berar Oil Industries and Another v. Deputy Commissioner of Commercial Taxes, Anantapur [1959] 10 S.T.C. 199, in which decisions it was held that when rule 4(2) of the Madras General Sales Tax (turnover and Assessment) Rules, 1939, tax was levied on groundnut, the word 'groundnut' included groundnut kernel (sic). It also appears from the judgment [1961] 12 S.T.C. 691 of the Kerala High Court, referred to above, that earlier in Kishenlal Oil Mills, Hyderabad v. Commissioner of Sales Tax, Hyderabad [1955] 6 S.T.C. 650, it was held that the word 'groundnut' in rule 5(2) of the Hyderabad General Sales Tax Rules meant unshelled groundnut and not the kernel and that the said judgment had been reversed by the Supreme court in appeal. If, therefore, when the word 'groundnut' is used its kernel is included, and if the word 'cashew' is used, its kernel is also included, we fail to see why when the word 'tamarind' is used, its seeds should not be included, particularly when it is the case of the department itself that the only parts of the tamarind which can be powdered are either the seeds or the skin.

5. For these reasons, we hold that the Tribunal was justified in holding that tamarind seed powder fell under entry No. 12 of Schedule A to the Bombay Sales Tax Act, 1959.

6. Accordingly, we answer the question submitted to us in the affirmative.

7. The applicant will pay to the respondents the costs of this reference.

8. Reference answered in the affirmative.


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