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Commissioner of Sales Tax, Delhi Administration Vs. Baluja Glass Company - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtDelhi High Court
Decided On
Case Number S.T.R. No. 21 of 1974
Judge
Reported in[1980]46STC17(Delhi)
AppellantCommissioner of Sales Tax, Delhi Administration
RespondentBaluja Glass Company
Appellant Advocate Mohinder Pratap, Adv
Respondent Advocate Randhir Chawla and ; Renu Sehgal, Advs.
Cases ReferredCommissioner of Sales Tax v. Polychem Ltd.
Excerpt:
.....of the counsel for the revenue that 'glass sheets' or at least 'window-panes' made out of the glass sheets would fall under the term 'glassware'.the decision of the nagpur high court was given in the context of glassware being luxury item and it was observed that glass panes are not used by poor class of people. on the same reasoning we are of the view that glass sheets and glass panes are different from 'glassware'.this term is well-understood and no one can call glass sheets to be 'glassware' just as no one will call a brass sheet or silver ingot to be brassware or silverware. we cannot agree with the finding that glass sheets would be raw material for fabricating window-panes thereby making window-panes 'glassware'.we agree with the finding that glass sheets as such are not..........fatehpuri, delhi (hereinafter referred to as the dealer), carry on the business of selling glass sheets and glass panes. the sales of glass sheets and glass panes of the dealer for the period 1st april, 1966, to 31st march, 1967, were assessed to sales tax under section 11(1) of the aforesaid act by an assessment order dated 17th september, 1968. the rate at which tax was levied was 5 per cent under clause (c) of sub-section (1) of section 5 of the act. this assessment was revised on the basis of some information with the assessing authority and proceedings under section 11a were taken. the turnover of the dealer relating to glass sheets and glass panes was subjected to sales tax at 7 percent under clause (a) of section 5(1) by an order dated 11th december, 1968. the assessing.....
Judgment:

Prakash Narain, J.

1. This reference is made to us by the Administrator of the Union Territory of Delhi (Lt. Governor) by virtue of the provisions of Section 21 of the Bengal Finance (Sales Tax) Act, 1941. The circumstances leading up to the reference may be noticed.

2. M/s. Baluja Glass Company, Fatehpuri, Delhi (hereinafter referred to as the dealer), carry on the business of selling glass sheets and glass panes. The sales of glass sheets and glass panes of the dealer for the period 1st April, 1966, to 31st March, 1967, were assessed to sales tax under Section 11(1) of the aforesaid Act by an assessment order dated 17th September, 1968. The rate at which tax was levied was 5 per cent under Clause (c) of Sub-section (1) of Section 5 of the Act. This assessment was revised on the basis of some information with the assessing authority and proceedings under Section 11A were taken. The turnover of the dealer relating to glass sheets and glass panes was subjected to sales tax at 7 percent under Clause (a) of Section 5(1) by an order dated 11th December, 1968. The assessing authority treated the glass panes and glass sheets as falling under the head 'glassware' mentioned in entry No. 23 of the First Schedule of the Act. This entry reads as under :

Glassware, glazed ware and china-ware including crockery.

3. The dealer filed an appeal which was dismissed by the Assistant Commissioner of Sales Tax. A revision also met the same fate. The dealer then moved the Financial Commissioner of Delhi who passed a curious order. The Financial Commissioner came to the conclusion that glass sheets as such would not be 'glassware' but if the glass sheets are cut or fabricated into glass panes they would stand included in 'glassware' under entry No. 23. The Financial Commissioner further observed that glass sheet initially produced by the manufacturer has to be excluded from the item of 'glassware' as used in item No. 23 of the First Schedule of the Act. The Commissioner of Sales Tax thereupon moved for the present reference and that is how it is before us.

4. In our opinion, the interpretation of entry No. 23 read earlier presents no difficulty at all. It is settled law that while construing entries in taxing statutes, words must be given their ordinary connotation or at best connotation acceptable and commonly understood in the commercial world. One need not cite authority for this proposition. If that is the law, then reading the entry as it is we have no doubt in holding that 'glassware' means containers or vessels or other items of use made of glass. It would certainly not include glass sheets or window-panes cut out of glass sheets. By no stretch of imagination cutting of window-panes from glass sheets can be called fabrication.

5. The learned counsel for the revenue has invited our attention to two decisions, namely, Commissioner of Sales Tax, Madhya Pradesh, Nagpur v. Mohanlal Ramkisan Nathani, Raipur [1955] 6 S.T.C. 136 and Tribuwandas Gulabchand and Brothers, Nagpur v. State of Maharashtra [1965] 16 S.T.C. 452. These two decisions seem to support the contention of the counsel for the revenue that 'glass sheets' or at least 'window-panes' made out of the glass sheets would fall under the term 'glassware'. The decision of the Nagpur High Court was given in the context of glassware being luxury item and it was observed that glass panes are not used by poor class of people. Though the judgment was pronounced in 1952, it seems that it had escaped the attention of the learned Judge that in all development of housing even for the weaker sections of society glass paned windows are standard specifications. However, we cannot persuade ourselves to agree with the reasoning in that case.

6. In the Bombay case [1965] 16 S.T.C. 452, the question was whether glassware would include glass sheets as understood in trade parlance. It was observed that it was a question which could be determined only on evidence but if evidence was not available the question had to be decided on the consideration of the entry.

7. The judgment is a long one dealing with a lot of definitions taken from dictionaries and analogous statutes. As was observed by us earlier, one does not have to go to dictionaries unless a word or a term is commonly not in use. 'Glassware' may include, as has been observed in that case, articles made of glass, but the converse that all articles made of glass will be glassware will not be correct. And that, in our respectful opinion, is the fallacy which led the Honourable Judges of the Bombay High Court to hold that 'glass sheet' was 'glassware'.

8. The learned counsel for the dealer has brought to our notice a recent decision of the Bombay High Court in Commissioner of Sales Tax v. Polychem Ltd. [1977] 39 S.T.C. 315 We are in respectful agreement with the approach of the learned Judges. In this matter the question that arose for determination was whether pollinate sheets used for making toys and novelties, etc., should be regarded as 'plastics' and not 'goods made primarily from any kind of plastics' within the meaning of entry 19A of Schedule E to the Bombay Sales Tax Act, 1959. It was held that pollinate sheets were not goods made primarily from any kind of plastics. On the same reasoning we are of the view that glass sheets and glass panes are different from 'glassware'. This term is well-understood and no one can call glass sheets to be 'glassware' just as no one will call a brass sheet or silver ingot to be brassware or silverware. We would, accordingly, partly agree with the finding of the Financial Commissioner but partly we must differ. We cannot agree with the finding that glass sheets would be raw material for fabricating window-panes thereby making window-panes 'glassware'. We agree with the finding that glass sheets as such are not 'glassware'.

9. As we have said before, 'glassware' is a term which is well-understood. Articles made of glass particularly vessels or containers would be 'glassware'. It becomes clearer when we read the entry as a whole because it deals with the glazed ware, china-ware including crockery besides glassware. Turnover from sale of 'glass sheets' or 'glass panes' cannot be taxed as falling under entry No. 23. The reference is answered accordingly.

10. The dealer would be entitled to its costs. Counsel's fee Rs. 300.


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