Common parlance meaning for taxing entries confirms tractor parts and electric motors taxable at the higher rate.

Undefined taxing terms are construed in their ordinary and common parlance sense, so a tractor is treated as machinery and its parts as spare parts of machinery where the notification so covers them. On that basis, tractor parts fell within the 7 per cent entry and were not taxable at 5 per cent. Electric motors were also held to fall within the notification entry for electrical goods, instruments, apparatus and appliances, which prescribed tax at 7 per cent, leaving no scope for the lower rate. The assessment at 7 per cent was accordingly upheld on both issues.

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Issues: (i) Whether tractor parts were machinery or spare parts of machinery and therefore liable to tax at 7 per cent under the notification dated 30th December, 1957. (ii) Whether electric motors were exigible to tax at 7 per cent under the relevant taxing entry in the notification dated 30th December, 1957.

Issue (i): Whether tractor parts were machinery or spare parts of machinery and therefore liable to tax at 7 per cent under the notification dated 30th December, 1957.

Analysis: The expression "machinery" was not defined in the Act and had to be understood in its ordinary and common parlance sense. On that approach, a tractor is machinery, and its parts fall within the concept of spare parts of machinery. Entry 60 of the notification covered all machinery and spare parts and accessories thereto.

Conclusion: Tractor parts were liable to tax at 7 per cent, and the Tribunal was not right in treating them as taxable at 5 per cent.

Issue (ii): Whether electric motors were exigible to tax at 7 per cent under the relevant taxing entry in the notification dated 30th December, 1957.

Analysis: Electric motors fell within the description of electrical goods, instruments, apparatus and appliances under item 34 of the notification. That entry specifically prescribed taxation at 7 per cent, leaving no scope for treatment at the lower rate.

Conclusion: Electric motors were rightly assessed to tax at 7 per cent.

Final Conclusion: The reference was answered in favour of the Revenue on both questions, and the assessment at 7 per cent was upheld.

Ratio Decidendi: Where a taxing entry uses an undefined commercial expression such as "machinery", the term is to be construed in its common parlance sense, and articles falling within that ordinary meaning, including their spare parts where specifically covered, are taxable according to the relevant notification.

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