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Premier Films and anr. Vs. C.T.O., Shyambazar Charge and - Court Judgment

LegalCrystal Citation
CourtSales Tax Tribunal STT West Bengal
Decided On
Judge
Reported in(2008)13VST476NULL
AppellantPremier Films and anr.
RespondentC.T.O., Shyambazar Charge and
Excerpt:
.....of the petitioner no. 1 firm, m/s. premier films, was carrying on business of reselling x-ray films. commercial tax officer, shyambazar charge, (in short, "the cto") assessed the petitioners' sales tax dues for the year 1992-93 under the bengal finance (sales tax) act, 1941 (hereinafter referred to as, "the 1941 act") and passed an assessment order on may 8, 1995 estimating gross turnover at rs. 3,50,000 instead of the book figure of rs. 3,01,483.50.in his assessment order, the cto treated x-ray films as photographic films and levied tax at 11 per cent under section 5(1)(d) of the act of 1941 instead of eight per cent under section 5(1)(e) of the said act.the petitioners preferred appeal before the assistant commissioner, commercial taxes, north circle. by order dated september 14,.....
Judgment:
1. At the material point of time, the petitioner No. 2, Smt. Archana Kejriwal as proprietress of the petitioner No. 1 firm, M/s. Premier Films, was carrying on business of reselling x-ray films. Commercial Tax Officer, Shyambazar Charge, (in short, "the CTO") assessed the petitioners' sales tax dues for the year 1992-93 under the Bengal Finance (Sales Tax) Act, 1941 (hereinafter referred to as, "the 1941 Act") and passed an assessment order on May 8, 1995 estimating gross turnover at Rs. 3,50,000 instead of the book figure of Rs. 3,01,483.50.

In his assessment order, the CTO treated x-ray films as photographic films and levied tax at 11 per cent under Section 5(1)(d) of the Act of 1941 instead of eight per cent under Section 5(1)(e) of the said Act.

The petitioners preferred appeal before the Assistant Commissioner, Commercial Taxes, North Circle. By order dated September 14, 1995, the Assistant Commissioner did not accept the contention of the petitioners that x-ray films could not be treated as photographic films. He, however, modified the assessment order on some other ground. Against the said appellate order, the petitioner moved the West Bengal Commercial Taxes, Appellate and Revisional Board (hereinafter referred to as, "the Board") in revision. By judgment and order dated January 13, 2005, the Judicial Member of the Board confirmed the appellate order and dismissed the revision. Being aggrieved, the petitioners have approached this Tribunal.

2. According to the petitioners, x-ray films did not fall within the description "photographic films and plates" as contemplated in Section 5(1)(d) of the 1941 Act and there being no other clause covering x-ray films those were covered by the residuary clause in Section 5(1)(e) of the Act. The CTO disallowed such claim. The Assistant Commissioner rejected the said contention of the petitioners merely stating that such claim had no logic. While confirming the appellate order, the Board also did not assign any reason of its own but merely recorded that no cogent and sufficient grounds could be placed by the dealer to support that x-ray films and photographic films were different commodities.

3. None of the three authorities below had really examined the question upon proper application of mind and recorded any independent finding analysing the similarities or differences between these two types of goods.

4. Learned advocate appearing for the petitioners has placed before us several decisions on the said question and a circular issued by the Commissioner of Commercial Taxes in support of the contention that x-ray films were/are different from photographic films and plates.

5. The Punjab High Court (Circuit Bench at Delhi) in Dr. Diwan Chand Agganval v. Commissioner of Sales Tax, Delhi reported in [1963] 14 STC 51 considered whether x-ray apparatus and x-ray films would come under item No. 6 of the First Schedule to the 1941 Act which covered: Photographic and other cameras and enlargers, lenses, films and plates, paper and cloth, and other parts and accessories required for use therewith.

6. After discussing the distinguishing features of x-ray apparatus and films, the learned judge of the Punjab High Court (Circuit Bench at Delhi) held therein: ...I am satisfied, therefore, that x-ray apparatus and the films, etc., which are used therewith cannot fall within item No. 6 of the First Schedule of the Act. They would fall under Clause (c) of Section 5(1) for which the rate would be 4 naye paise in the rupee and that is the rate which, according to the petitioner, was the correct rate at which sales tax was payable on these goods.

7. The West Bengal Commercial Tax Tribunal of the said period followed the aforesaid judgment of the Punjab High Court in several cases and took the view that x-ray films and photographic films did not fall within the same category. In Radon House (P) Ltd. v. ACCT, Calcutta (South Circle) reported in [1977] 10 STA 99 (WBCTT), the said Tribunal took the view: An apparatus used for producing the x-ray, with which photographs of the inside of the body can be taken for the purpose of medical diagnosis and for treatment of maladies of certain nature cannot possibly be regarded as 'photographic and other cameras', nor can the films used for the purpose of taking photographs with such an apparatus be deemed to be an accessory required for use therewith.

8. The said Tribunal again in Orwo Films (Eastern Unit) v. ACCT, Calcutta (South Circle) reported in [1978] 11 STA 113 reiterated the same view.

Next question would be whether the films and plates for use in photography and other cameras can be considered as identical with x-ray films. We know that in camera the source is light unlike x-ray apparatus which is worked with x-rays by complicated electric connection. It is rightly contended by the learned representative for the petitioner that since x-ray films are used solely by hospitals for the purpose of human welfare, it could not be the intention of the Government to tax those goods at a rate applicable to goods enlisted in Schedule II of the Bengal Finance (Sales Tax) Act, 1941 which are commonly called luxury goods.

9. The said Tribunal again followed the aforementioned decision in Siemens India Ltd. v. ACCT, Calcutta (South Circle) [1982] 15 STA 85.

10. It is well-settled that where no particular definition or definite clue is available, the meaning as understood in common parlance should be adopted. In common parlance, x-ray films are always regarded as something different from common photographic films. A common man normally does not describe or treat x-ray films as photographic films although technically and scientifically both may be photographic films.

11. Different features distinguishing x-ray films from photographic films have been explained and enumerated in the judgement of the Punjab High Court (Circuit Bench at Delhi) in Dr. Diwan Chand Aggarwal [1963] 14 STC 51 which had been consistently followed by the then West Bengal Commercial Tax Tribunal.

12. The learned advocate for the petitioner has also drawn our attention to a circular of the Commissioner, Commercial Taxes, printed in the books on the Bengal Finance (Sales Tax) Act, 1941. From the circular as printed, no particulars regarding the said circular is available. The respondents, however, have not clearly denied the existence of that circular. By the said circular, x-ray films were declared to be distinct from unexposed photographic films and it was clarified that no sales tax permit was necessary to import x-ray films into West Bengal. In absence of the relevant particulars, it is not possible for us to rely upon this aforesaid circular but it appears to us that x-ray film is a special type of film which can be used only in x-ray apparatus and not in photographic cameras and x-ray films are commonly believed to be different from photographic films. As photographic films and plates did not cover x-ray films, the residuary clause under Section 5 of the Act of 1941 was applicable to x-ray films.

13. For the foregoing reasons, the impugned assessment order, appellate order and the revisional order are set aside. The assessing authority is directed to reassess the petitioners' tax liability for the year 1992-93 on the basis that x-ray films were not included and covered by the term "photographic films and plates" in Section 5(l)(d) of the Bengal Finance (Sales Tax) Act, 1941. Such reassessment is to be completed by October 31, 2006 and the assessing officer will give appropriate opportunity of hearing to the petitioners or their authorised representative. Application is allowed.


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