1. In this sales tax revision, the question is whether sale of eucalyptus trees is sale of firewood. If it is, it would be exempt from taxation.
2. Sale of firewood is exempted from sales tax under the Tamil Nadu General Sales Tax Act, 1959. The exemption is granted by the State Government in exercise of a power in that regard conferred by the statute. The order of exemption is notified in the Gazette under Notification No. II(1)/Rev/386(g)/74 dated 4th March, 1974. The notification simply says that the Governor is pleased to exempt from sales tax 'firewood'.
3. The claim for exemption under this notification arises in this way : The assessee is a forest coupe contractor. In a forest auction the assessee purchased eucalyptus and other trees as a coupe. He felled the eucalyptus trees and sold them to one P. R. Lakshmi, who is described as a pulpwood contractor. The eucalyptus trees purchased by her were then cut to X size and also debarked. The timber pieces so fashioned were sold by her to Gwalior Rayons, describing the pieces as 'pulpwood'. Gwalior Rayons used these shaven chips of eucalyptus wood as raw material to manufacture rayon in their mills.
4. The question is, whether the sale by the assessee, coupe contractor, Lakshmi is sale of 'firewood' within the meaning of the notification for exemption. The notification does not define firewood. We feel that for such a word as this there need be no statutory definition. It is all the better for not being defined. Every housewife knows what firewood is. Every firewood depot proprietor knows what firewood is. In our opinion, Judges and Tribunals must adopt that meaning which would not offend the common speech of commercial men and the consuming public, for sales tax is a commercial tax on sales turnover of a dealer in the course of business. What meaning an article has in the market, and in commerce between dealers and customers in general, must be its proper classification in the statute. Judged by this consideration, casuarina will be firewood. But eucalyptus cannot be dubbed or classified as firewood. It will certainly burn if you set fire to it. But every wood that burns is not firewood. Eucalyptus might well be used as fuel for want of any other wood for burning, even as sandalwood in varying quantities may be used as fuel in cremation grounds. But sandalwood is not firewood on that account. Likewise, eucalyptus is not firewood, merely because it can also be used to start a fire and produce heat.
5. The learned counsel for the assessee referred to the forest department contract form of sale, and said that the coupe purchased by the assessee, in which the eucalyptus was included, was described as 'fuel coupe'. But this expression was obviously used as a drafting device to cover a wide range of forest trees found in the coupe area. A single shorthand expression was found convenient for being employed to denote all the trees in the coupe, save certain varieties. The expression tended to avoid a repetition of mention of the wide varieties of trees included in the contract every time a clause in the contract carried a reference to them.
6. Quite apart from the expression 'fuel coupe' being a term of the draftsman's art in this particular contract form, the test of what the subject-matter of a sale is cannot ordinarily be concluded by any nomenclature that the parties choose to use in their documents, but must be decided on the basis of what, in reality and in substance, is the type of goods which fits in with the description given in the statute or in the statutory instrument, as the case may be.
7. We are satisfied that eucalyptus is not firewood. Its sale is not, therefore, exempt under the notification. This means that the sale is taxable.
8. The sale of eucalyptus in this case has been actually charged in this assessment at the rate of 4 per cent under multi-point tax. It seems to us that it is taxable in the hands of the assessee at single point, at the rate of 5 per cent, in accordance with the explanation to entry 84 of the First Schedule to the Tamil Nadu General Sales Tax Act, 1959. Hence, while holding that the sale of eucalyptus is not exempt from sales tax, but chargeable to tax, we cannot bring ourselves to say that it has been taxed aright in the assessment which has been made and confirmed in this case.
9. The result is that this revision is dismissed. There will, however, be no order as to costs.