Strict construction of taxing provisions kept Banarsi cloth outside the special silk-goods rate and limited it to general tax.

Banarsi cloth was held not to fall within "all silk goods" in item No. 7 of Schedule No. 1 under the pre-1949 Bombay Sales Tax Act because the phrase was construed to mean goods made wholly of silk, and the later amendment could not be applied retrospectively. As the taxing language was at least ambiguous, the court applied strict construction in favour of the subject and placed the burden on the revenue to show a clear charge. The cloth was therefore taxable only at the general sales tax rate, with consequential relief to the assessee.

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Issues: Whether Banarsi cloth falling within item No. 7 in Schedule No. 1 to the Bombay Sales Tax Act was liable to special sales tax as "all silk goods" or was taxable only at the general rate.

Analysis: The assessment period was governed by the Bombay Sales Tax Act as it stood before the 1949 amendment, and the later amendment introducing additional items could not be applied retrospectively. On the wording of item No. 7, the expression "all silk goods" was construed to mean goods made wholly of silk. In any event, the phrase was held to be ambiguous. In a taxing statute, any reasonable doubt must be resolved in favour of the subject, and the burden lies on the revenue to show that the charge is imposed in clear language.

Conclusion: The cloth was not liable to the special rate under item No. 7 and was taxable only at the general rate, in favour of the assessee.

Final Conclusion: The tax assessment was reduced by treating the disputed cloth as subject only to the general sales tax rate, with consequential relief to the applicants.

Ratio Decidendi: A taxing provision must be construed strictly, and where its language is ambiguous the construction most favourable to the subject must prevail.

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