1. Two questions have been referred to us for determination in this reference on a case stated by the Sales Tax Tribunal under section 61(1) of the Bombay Sales Tax Act, 1959 (referred to hereinafter as 'the said Act'). The said questions are as follows :
'(a) Whether on the facts and in the circumstances of the case and on a true and proper interpretation of entries 7 and 19 of Schedule E to the Bombay Sales Tax Act, 1959 the Tribunal was correct in law in holding that the articles (i) Baby powder, (ii) Binaca talc for men, (iii) Binaca talc sandal and (iv) Binella stardust talc, were not 'cosmetics' within the meaning of entry 19 of Schedule E but were 'toilet articles' within the meaning of entry 7 of Schedule E to the Act ?
(b) Whether on the facts and in the circumstances of the case and on a true and proper interpretation of entries 7 and 19 of Schedule E to the Bombay Sales Tax Act, 1959 and entry 38 of the notification issued under section 41 of the Act, the Tribunal was right in holding that the articles 'Forbina powder' was not 'cosmetic' covered by entry 19 of the Schedule E to the Act but was covered by entry 22 of the Schedule E and was also eligible to the benefit of entry 38 of the notification issued under section 41 of the Act ?'
2. The facts giving rise to the reference are as follows :
The respondent is a company limited by shares and is a registered dealer under the said Act. By an application dated 24th June, 1970 made under section 52 of the said Act, the respondent applied to the Commissioner of Sales Tax to determine the correct rate of tax payable on the sales of certain items effected by the respondent. The said items were sold under two bills, both of which were dated 14th May, 1970. The respondent withdrew its request in respect of one of the bills and the items referred to therein and hence the Commissioner considered the question in respect of the goods sold under the other bill. Under that bill, the respondent had sold the powders manufactured by it under the following brand names :
(1) Baby powder,
(2) Forbina powder,
(3) Binaca talc for men,
(4) Binaca talc sandal,
(5) Binella stardust talc.
After the receipt of the respondent's application, the Commissioner addressed identical letters to certain other manufacturers of talcum powder. The only relevant query made by the Commissioner in his letter was follows :
'Under what Schedule-entry of the Bombay Sales Tax Act, 1959 you have been classifying the said product for the purpose of collection/payment of the tax on the sales of the said product ?'
This query was addressed to well-known concerns like Godrej Co. P. Ltd., Colgate Palmolive (India) Ltd., Chesebrough-Pond's Inc., Hindustan Lever Ltd. Lakme Ltd., Mid Rose Cosmetics Industries and Roop Kala Industries. The replies given by these manufacturers, although not identical in form, all stated that they classified the talcum powders manufactured by them under entry 19 of Schedule E to the said Act and were collecting and paying tax on the said goods at the rates specified in the said entry. It may be mentioned that the Commissioner's letters dated 6th January, 1971 referred to earlier, by which the said query was addressed, itself made it clear that the query was in respect of rate of tax on talcum powders. The replies received also made it clear that they related to talcum powders manufactured and sold by these companies. The Commissioner addressed a letter dated 22nd March, 1971 to the respondent and requested the respondent to state as to why the opinions given by the aforesaid manufacturers should not be held as reflecting the common trade parlance classification of talcum powders as cosmetics and enclosed copies of the replies received by him from the manufacturers referred to earlier with the said letter. By its reply dated 12th April, 1971 the respondent raised several contentions as to why the replies given by the aforesaid manufacturers could not be said to be indicative of the way in which the talcum powders manufactured and sold by the respondent which were referred to in its application were regarded in the trade parlance. In the first place, the respondent contended that the products manufactured by the respondent were different from the powders manufactured by the dealers to whom the said letters were addressed and used for different purchases. It was further contended that because a person pays tax on the sale of some goods erroneously considering that such goods are covered by entry 19 of Schedule E, that would be no ground for classifying such goods in law under that entry. In the said letter, the respondent gave particulars of the contents of the talcum powders in respect of which the determination of rate of tax was sought by it. It is not necessary to refer here to these contents in detail. It was claimed by the respondent, inter alia, that Binaca baby powder contained a substance known as bradasol which was an antiseptic and prevented nappy rash and skin irritations. In respect of Forbina powder, it was stated that it was a body powder and not a face powder. It contained chemicals which had an antiseptic and deodorising effect. It also contained formocibazol which had antibacterial and anti-fungal properties. It was claimed that Forbina powder should really be classified as medicine falling under entry 22 of the Schedule E. In respect of other powders, it was stated that they were body powders as distinguished from face powders and such body powders should not be considered as cosmetics. The Commissioner held that all the said powders fell within the scope of entry 19 of the Schedule E to the said Act and were liable to the levy of sales Tax and general sales tax at the rates mentioned therein. He thus treated these powders as being cosmetics, but not toilet articles. The respondent filed an appeal to the Sales Tax Tribunal. It was contended on behalf of the respondent before the Tribunal that the test of an article being a cosmetic is that it should be meant for beautification and none of the powders manufactured by the respondent in respect of which the determination of classification was sought could be said to be used for beautification as they were dusting powders for use after bath. It was contended on behalf of the respondent that the common parlance test should not be the sole factor for determination in a case like this. As regards Forbina powder, it was contended on behalf of the respondent that it was nothing but a medicine as the chief use of Forbina powder was as medicine. For the sake of convenience, we propose to refer hereafter to the talcum powders other than Forbina powder in respect of which determination of the rate of tax was sought a 'the said powders'. The contention on behalf of the Revenue, on the other hand, was that the primary test for classification of goods under entries in a law relating to sales tax or excise should be according to the popular parlance or the sense in which these items were regarded in trade. The correct test was of trade parlance or common parlance in trade. It was further contended by the Revenue that the aforesaid letters sent by the manufacturers were indicative of the fact that in trade parlance talcum powders were regarded as cosmetics and not as toilet powders. The Tribunal came to the conclusion that, looking at the language of entry 7 and entry 19 of Schedule E, 'cosmetic' must be regarded as a genus and 'toilet articles' must be regarded as one of the species of that genus for the purposes of those entries. The Tribunal held that the mere application of common parlance test in a case like this would result in oversimplification and produce erroneous results. The Tribunal referred to various dictionary meanings of the term 'cosmetic' and came to the conclusion that primarily the said expression could used to described anything which was used for the purpose of beautification, and in respect of powders, it was only face powders, as distinguished from body powders, which could be regarded as cosmetics. The Tribunal observed that beautification of the person is a decisive attribute of cosmetic. The Tribunal held that all the said powders were body powders and must be really regarded not as cosmetics but as toilet articles. The Tribunal held that toiletry signifies a preparation for sprinkling or rubbing over the skin of the body as after bathing, usually with shooting or antiseptic ingredients and all the said powders fell within this description. In connection with the aforesaid replies received from certain manufacturers, the Tribunal took the view that these replies only showed how these manufacturers classified the talcum powders manufactured and sold by them for paying tax on the sales of those powders and not as to how entries 7 and 19 of Schedule E were understood by these manufacturers in the commercial sense. This is clear from the observations of the Tribunal in paragraph 18 of its judgment. It was thus held that the information supplied by these manufacturers did not shed light on the crucial aspect of the matter nor did these replies show that the said manufacturers regarded the said articles referred to by them in a commercial sense as 'cosmetics' and not as 'toilet articles'. In respect of Forbina powder, the Tribunal set out the composition of this powder which was as follows :
'FormaldehydeSulphathiazole 1 w/wZinc Oxide B.P. 2.5% w/wBoric Acid B.P. 3% w/wLight Kaolin B.P. 2% w/wCentyl Alcohol N.F. 0.2% w/wTalc B.P. q.s.'
The Tribunal pointed out that according to the British Pharmacopoeia 1973 and the Indian Pharmacopoeia 1966, formaldehyde is used as an antiseptic. Sulphathiazole is effective in staphylococcal and certain other infections. Zinc oxide and boric acid have mild antiseptic and the antibacterial properties. The Tribunal took the view that the composition of Forbina powder and medicinal properties of its ingredients show that the primary and essential use of the powder was as medicine. It was held by the Tribunal that Forbina powder was a medicine and in view of the exemption granted at serial No. 38 in the notification dated 14th August, 1965 the sales of this powder were entirely exempt from payment of general sales tax. It is the correctness of this decision which is sought to be tested in the questions referred to us.
3. As far as question No. (a) is concerned, it relates to the said powders, namely, the aforesaid talcum powders, other than Forbina powder. In respect of these powders, the main controversy is whether these powders should be regarded as toilet articles as contended by the respondent or as cosmetics as contended by the Commissioner. The submission of Mr. Jetly, learned counsel for the applicant, is that to determine a question like this, what the Court must consider is whether the said powders would be regarded as cosmetics in trade parlance, that is, the parlance of persons dealing in such powders. It was urged by him that the aforesaid replies given by the manufacturers referred to earlier were evidence establishing that in trade parlance such powders, namely, talcum powders were regarded as cosmetics and not as toilet items. The submission of M. Patel, learned counsel for the respondent, on the other hand, was that these replies were of no assistance in determining the connotation of the term 'cosmetics' as distinguished from toilet articles in trade parlance. It was further submitted by him that in a case like this, it would not be right to apply the test of trade parlance.
4. Before considering the merits of these rival submissions, it will be useful to refer to the relevant entries in Schedule E to the said Act. Schedule E to the said Act sets out a list of goods, the sale or purchase of which is subject to sales tax, general sales tax, purchase tax and retail sales tax and the rates of sales tax, general sales tax and purchase tax. The said Schedule is under sections 10, 13 and 14 of the said Act. At the relevant time, the portion of entries 7 and 19 of Schedule E with which we are concerned read thus :
SCHEDULE E----------------------------------------------------------------------Sr. Description Rate of Rate ofNo. sales tax generalsales tax----------------------------------------------------------------------7. Toilet articles including hair Eight paise Three paisecream, hair tonic and hair oil in the rupee. in the rupee.(but excluding soap, tooth-pow-der and tooth-paste).19. Perfumes, depilatories and cosm- Ten paise Three paiseetics (except soap and articles in the rupee. in the rupee.specified in entry 7 in thisSchedule).----------------------------------------------------------------------
It may be mentioned here that entry 22 of this Schedule is a residuary entry. A plain reading of entries 7 nd 19 of Schedule E shows that it was contemplated by the Legislature that certain cosmetics could also be regarded as toilet articles and certain toilet articles could be regarded as cosmetics, that is, there were certain articles which in trade parlance might be referred to both as toilet articles and cosmetics. It is possible that the Legislature took the view that 'cosmetics' was the wider category or genus and toilet articles form species of such genus, although that does not necessarily follows. What an analysis of the two entries shows is that there are certain articles which could be regarded as cosmetics as well as toilet articles and that for the purpose of classification an determination of the rate of sales tax and general sales tax, such items should be held to be covered by entry 7. Thus what we shall have to examine first is whether the said powders could be regarded as toilet articles. It is true that the general principle of classification of goods under entries in the Schedules to the said Act or for that matter, Sales Tax Act should be according to trade parlance. This is clear from the decision of the Supreme Court in Ramavatar Budhaiprasad v. Assistant Sales Tax Officer, Akola : 1SCR279 where it was held that the word 'vegetables' in item 6 of Schedule II of the C.P. and Berar Sales Tax Act, 1947 must be construed not in any technical sense nor from the botanical point of view but as understood in common parlance. It has not been defined in the Act and being a word of every day use it must be construed in its popular sense meaning 'that sense which people conversant with the subject-matter with which the statute is dealing would attribute to it'. The same principle as reiterated by the Supreme Court in Ganesh Trading Co., Karnal v. State of Haryana : AIR1974SC1362 where it was held that although rice is produced out of paddy, it is not true to say that paddy continued to be paddy even after dehusking. Rice and paddy are two different things in ordinary parlance. Hegde, J., in the course of the judgment pointed out as follows :
'......... This Court has firmly ruled that in finding out the true meaning of the entries mentioned in a Sales Tax Act, what is relevant is not the dictionary meaning, but how those entries are understood in common parlance, specially in commercial circles .........'
In the light of these decisions, there can be no dispute that entries in Schedule to a sales tax law must be generally interpreted in accordance with trade parlance or common parlance of persons dealing in such items. In the present case, however, as we have pointed out, he Legislature itself contemplated that there were articles which could be regarded as cosmetics as well as toilet articles in trade parlance. This is clear from the language of the descriptive part of entries 7 and 19 of Schedule E as we have pointed out. In view of this, even if the Revenue established that in trade parlance certain articles are regarded as cosmetics this would not conclusively show that such articles should be classified under entry 19 and not under entry 7. Before that is done, it should further be established in trade parlance the articles in question were regarded as cosmetics and not as toilet articles. There is nothing to show that the Revenue has established either of the above requisites in the present case. Mere replies from certain manufacturers that they paid sales tax and general sales Tax on the sale of certain talcum powders on the footing that they were covered by entry 19 of Schedule E would be no evidence to suggest that in trade parlance such talcum powders were regarded not as toilet articles, but as cosmetics. A mere reply from a manufacturer that he paid taxes on the sales of the talcum powders manufactured by him under entry 19 cannot even be regarded as establishing that such manufacturer considered such talcum powders to be cosmetics at all. There might to various reasons why some manufacturers might have paid sales tax on talcum powders manufactured and sold by them under entry 19. For example, to avoid any loss which they might have incurred in the eventuality of these powders being considered as cosmetics and held to be cosmetics by the Sales Tax Authorities, if they had collected sales tax and general sales tax from their customers on the footing that such powders were toilet articles. It is also possible, as the order of the Commissioner shows, that, at some stage the Sales Tax Department might have taken up a contention that the talcum powders manufactured and sold by them were really cosmetics and not toilet articles and the said manufacturers might have tried to avoid disputes in this regard.
5. In our view, there is no evidence to show that cosmetics and toilet articles were considered as distinct articles in trade parlance, and further, there is no evidence to show that even if this was so, talcum powders were regarded in trade parlance as cosmetics and not as toilet articles. In view of this, in order to determine whether the aforesaid powders manufactured and sold by the respondent were toilet articles or cosmetics, we have to go to the ordinary meaning or the plain grammatical meaning of these two expressions. In order to do this, we have to consider the meaning given to these terms in dictionaries bearing in mind the caution that dictionaries give various shades of meaning applicable to words and expressions and one has to be careful to take into account only such meanings as are appropriate. We have examined the meanings given to the terms 'cosmetic', 'toilet' and 'toilet powders' in the Shorter Oxford English Dictionary (1955) at pages 401 and 2205 respectively, Chambers Twentieth Century Dictionary of the English Language (Second Unabridged Edition). It is not necessary to set out all these meanings here, as it would serve no purpose. Suffice it to say that these meanings indicate that the term 'cosmetic' is primarily applied to any preparation used on the human body to improve the beauty of hair, skin or complexion, whereas a toilet article is an article used in the process of cleansing and grooming one's person. This is clear from the fact that the word 'toilet' is defined as the act or process of dressing. We may set out here the meaning given to the term 'toilet powder' in Webster's New International Dictionary of the English Language. The relevant definition given there runs thus (page 2660) :
'TOILET POWDER : A fine powder usually with shooting or antiseptic ingredients used to sprinkle or rub over the skin of the body as after bathing, usually distinguished from powder used as cosmetic for the face.'
Bearing in mind these definitions which reflect the sense in which the cosmetic and toilet articles are usually regarded in ordinary parlance, it would appear to us that the said talcum powders manufactured and sold by the respondent in respect of which determination was sought under the said application must be regarded as articles of toilet. The main purpose why a body powder is used is just to freshen one's body, generally after a bath, for getting feeling of freshness or to dry oneself. It may incidentally serve to reduce the smell of perspiration and so on. The main purpose or use of such a powder is clearly not to beautify the complexion or appearance. In view of this, there is no doubt that the said powders must be regarded as toilet articles and in view of the language employed in the two entries, such powders cannot be regarded as cosmetics covered by entry 19 of Schedule E. As the said talcum powders are toilet articles, they must be regarded as covered by entry 7 of Schedule E and not entries 19 and 22.
6. We may in this connection note one further argument of Mr. Patel which was that the Revenue had failed to establish that the talcum powders to which the aforesaid replies of manufacturers related were similar to the said talcum powders manufactured and sold by the respondent. We are frankly not much impressed with this argument, because all these powders are essentially talcum powders used for dusting the body and if the respondent wanted to show that the talcum powders manufactured and sold by it were different from those of the other manufacturers who had given the said replies, it was for the respondent to establish that. It is not, however, necessary for us finally to determine this question.
7. The next question which we have to consider is how Forbina powder should be classified. In this regard, the submission of Mr. Patel, learned counsel for the respondent-dealer, is that in view of the fact that the said powder contains certain ingredients with definite medicinal qualities, it must be regarded as a medicine rather than a toilet article. We may point out that under the said notification dated 14th August, 1965, entry 38, sales of medicine used or intended to be used (whether internally or externally) for or in the diagnosis treatment, mitigation or prevention of disease in human beings or animals (other than those specified in entry 69 in Schedule C to the Act) were exempted from the payment of general sales tax. The said notification was issued under section 41 of the said Act. A plain reading of the said entry makes it clear that the first question which one has to consider in order to decide whether an article is covered by the aforesaid entry 38 in the notification is to see whether as such it could be classified as medicine. It is true that the Tribunal has taken a view that Forbina powder must be regarded as medicine and is entitled to exemption from the payment of general sales tax under the said notification. The Tribunal has set out the contents of Forbina powder. These contends have been set out by us earlier. The judgment of the Tribunal shows that out of these components of Forbina powder, there are only two which could really be said to have medicinal or therapeutic properties. These are formaldehyde and sulphathiazole. It must be remembered that the composition of Forbina powder shows that the proportion of these two together was one per cent. w/w in the total contents of Forbina powder. The discussion in the judgment of the Tribunal shows that the zinc oxide is merely a mild astringent for the skin and protective for slight abrasions and boric acid has feeble antibacterial and anti-fungal properties. We are of the view that merely because Forbina powder contains zinc oxide and boric acid it cannot be said to be a medicinal powder particularly in view of the fact that the total percentage of these items is only 5.5 per cent. in the composition of Forbina powder. We can only point out that even an article like Eau-de-Cologne, which can by no stretch of imagination be called a medicine although it has an antiseptic quality and could be usefully employed to prevent infection of abrasions (sic). We may make it clear that we should not be understood as saying that boric acid or zinc oxide by themselves are not drugs or medicines. All that we have pointed out is that the use of these two items in such minute quantities would not, in our opinion, turn Forbina powder, which primarily appears to be a toilet powder, into a medicine. We may, in this connection, refer to the advertisement issued by the respondent for Forbina powder which is on record. A plain reading of this advertisement show that the respondent advertise to their consumers that Forbina powder was a deodorant and a talc with mild antiseptic properties and the use of it would result in a felling of freshness. The main emphasis is on freshness which would be induced by the use of Forbina powder. It is stated in the advertisement that Forbina is a deodorant, a mild antiseptic and prevents skin irritation, prickly heat and rashes, but the entire emphasis is on the freshness which would be induced by the use of Forbina and not on its so-called medicinal properties. We must point out that it would be very unusual for any one advertising a medicine to put in such an advertisement. It is a typical advertisement for a toilet product. Although the advertisement cannot be regarded as at all decisive in the proper classification of Forbina powder, it does lend support to our view that Forbina powder is really a toilet article.
8. We may now refer to the decision of a Division Bench of the High Court of Madhya Pradesh in Commissioner of Sales Tax, Madhya Pradesh Indore v. Shri Sadhna Aushadhalaya  14 STC 813 where it was held that the Maha Bhringraj hair-oil manufactured by the assessee dealing in ayurvedic preparations is a 'toilet article' falling under entry 11 of Schedule I, Part I, of the C.P. and Berar Sales Tax Act, 1947. There is no justification for treating the oil as a 'medicinal preparation' merely because the assessee manufacturers the oil following the formula given in an ayurvedic treatise and the fragrance of the oil may be disagreeable to some people. It was contended on behalf of the assessee in that case that the aforesaid hair-oil was intended as a hair tonic for prevention of dandruff, falling hair and baldness. But the Division Bench declined to treat the said hair-oil as a medicine on this ground taking the view that such qualities would always be attributed by the manufacturers to heir-oils manufactured by them. We may mention incidentally that it was held by the Division Bench that the words 'cosmetics and toilet' are the words of everyday use. This decision lends support to the view which we have taken in respect of Forbina powder.
9. We may point out that it is significant that in most sales tax laws, both toilet articles and cosmetics are includes in the same entry. This appears to have been the position at the material time in the then Province of C.P. and Berar from the decision in Commissioner of Sales Tax, Madhya Pradesh, Indore v. Shri Sadhna Aushadhalaya  14 STC 813, the entry in question being entry 11 of Schedule I, Part I, of the C.P. and Berar Sales Tax Act, 1947. The same appears to have been the position under the sales tax law in Gujarat (see B. Shah & Co., Surat v. State of Gujarat 1971 28 STC 5. Even as far as the State of Maharashtra is concerned, we are informed that the said items are covered under the same entry at present. These decisions lend support to the view which we have taken.
10. We now come to the decision of a Division Bench of the Gujarat High Court in B. Shah & Co., Surat v. State of Gujarat  28 STC 5 on which strong reliance was placed by Mr. Patel. In the case it was held that Nycil medicated powder, with its special qualities and attributes, its character and composition and its recommended or intended use as advertised by the manufacturers is a medicine with the meaning of the word in entry 13 of Schedule C to the Bombay Sales Tax Act, 1959. It was further held that the expression 'toilet article' in entry 21A of Schedule E to the Bombay Sales Tax Act, 1959 should be confined only to those articles which produce a direct toilet effect, that is, to articles which could be directly used in dressing or grooming a person so as to beautify his appearance. It was held that Nycil medicated powder is not an article which is ordinarily used for the purpose of grooming a person by beautifying his appearance. In our view, a perusal of the facts of this case shows that it is distinguishable from the case before us. The contents of Nycil medicated powder which have been set out in the judgment of the Division Bench show that it contains Chlorphenesin B.P. being a substance which was introduced as a result of original work in the British Drug House Research Laboratories, and 'Nycil' was the trade name under which the British Drug House marketed the products of chlorphenesin. Chlorphenesin was a potent antifungal, antibacterial and trichomonicidal substance of law toxicity, effective against several organisms of the skin. The proportionate content of zinc oxide and boric acid in the said powder was also significantly larger than in the case of Forbina powder. A sample bottle of Nycil powder produced before the Division Bench showed that on it was printed 'Nycil for Prickly Heat and Active Skin Protection'. On the other side was printed 'Nycil contains chlorphenesin the antibacterial and antifungal agent. In actively prevents prickly heat and protects the skin from sores, dhobieitch, and athlete's foot'. The Division Bench took the view that the advertised use of the Nycil powder and its special attributes were such that it would be difficult to hold that Nycil powder would ordinarily be used by a consumer for grooming his person. In the case before us, the advertisement for Forbina powder, which we have referred to earlier, clearly shows that the main attribute sought to be given to Forbina powder was that it would produce a feeling of freshness. Such an advertisement would show that the purpose for which Forbina powder was intended to be used, according to the advertisement, was for the purpose of grooming. We may repeat that it is not suggested that an advertisement given by a manufacturer can be decisive in a matter of classification, but it can be considered with other relevant factors.
11. In our view, for the reasons which we have discussed earlier, Forbina powder must be regarded as an article of toilet and not a medicine.
12. The questions referred to us are answered as follows :
'Q. (a) In the affirmative, that is in favour of the respondent-dealer.
Q. (b) On a true and correct interpretation of entries 7, 19 and 22 of Schedule E to the Bombay Sales Tax Act, 1959 and entry 38 of the notification dated 14th August, 1965 Forbina powder is an article of toilet covered by entry 7 of Schedule E. The Tribunal was not right in holding that Forbina powder was covered by entry 22 of Schedule E and eligible to the benefit of entry 38 of the aforesaid notification.'
13. In view of the divided success attained by the parties, there will be no order as to the costs of the reference.