1997 (10) TMI 338 - SC - VAT and Sales Tax

Supreme Court interprets sales tax entry on 'perfumery' excluding 'dhoop' and 'agarbatti'

Pardeep Aggarbatti Versus State of Punjab and Others (and other appeals)

The Supreme Court interpreted the sales tax entry regarding 'perfumery' in relation to 'dhoop' and 'agarbatti.' Applying the principle of noscitur a ... Whether “dhoop” or “dhoop-batti” fell within the description of “perfume” thereunder? Held that:- Appeal allowed. We are in no doubt whatever that the word “perfumery” in the said entry No. 16 draws colour from the words “cosmetics” and “toilet goods” therein and that, so read, the word “perfumery” in the said entry No. 16 can only refer to such articles of perfumery as are used, as cosmetics and toilet goods are, upon the person. The word “perfumery” in the context in which it is used has, therefore, no application to “dhoop” and “agarbatti” Issues:Interpretation of sales tax entry regarding 'perfumery' and its applicability to 'dhoop' and 'agarbatti.'Detailed Analysis:1. Background: The case involved the assessment of sales tax on 'dhoop' and 'agarbatti' under the Punjab General Sales Tax Act, 1948. The dispute arose from the interpretation of Entry No. 16 of Schedule A of the Act, specifically focusing on the classification of these items under the category of 'perfumery.'2. Judgment of High Court: The Division Bench of the High Court of Punjab and Haryana reversed the decision of a single Judge, who had ruled in favor of the appellant in a writ petition challenging the sales tax assessment. The Division Bench primarily relied on a previous Supreme Court judgment in Commissioner of Sales Tax v. Indian Herbs Research and Supply Co. [1970] 25 STC 151.3. Interpretation of Entry No. 16: The Supreme Court analyzed the relevant entries and notifications under the sales tax statute. The original Entry No. 16 was later split into Entries 16 and 16A, with the latter specifically mentioning 'perfumery including dhoop and agarbatti.' The Court considered the ordinary meaning of 'perfumery' and its context within the entry.4. Precedents and Legal Interpretation: The appellant cited the judgment of the Bombay High Court in Commissioner of Sales Tax v. Gordhandas Tokersey [1983] 52 STC 381, which emphasized interpreting words in conjunction with related terms in the statute. The Court also referred to the decision in Assessing Authority v. Amir Chand Om Parkash [1974] 33 STC 120, where the Punjab and Haryana High Court held that 'dhoop' and 'agarbatti' did not fall under the category of 'perfumery' based on the context of the entry.5. Principle of Noscitur a Sociis: The Court applied the principle of noscitur a sociis, which means that words grouped together in a statute derive meaning from their context. In this case, the term 'perfumery' was understood in conjunction with 'cosmetics' and 'toilet goods,' indicating that it referred to items used for personal hygiene or pleasure, not religious purposes like 'dhoop' and 'agarbatti.'6. Decision: The Supreme Court concluded that the term 'perfumery' in Entry No. 16 should be interpreted in line with 'cosmetics' and 'toilet goods' and excluded items like 'dhoop' and 'agarbatti.' The Court set aside the judgment of the Division Bench, reinstating the decision of the single Judge in favor of the appellant. The appeals related to the same issue were also allowed based on this decision.7. Outcome: The appeals were allowed, the judgment under appeal was set aside, and the original judgment favoring the appellant was restored. No costs were awarded in the matter.This detailed analysis provides a comprehensive overview of the legal issues, interpretations, precedents, and final decision rendered by the Supreme Court in this sales tax assessment case.