Popular parlance governs sales tax classification: perfumed hair-oil treated as a cosmetic and taxed at the higher rate.

Perfumed hair-oil was classified under cosmetics and toilet requisites rather than oils of all kinds because sales tax entries are construed according to popular parlance and commercial understanding. The article was treated as a grooming and beautifying product with a distinct cosmetic character, and the later notification excluding perfumed hair-oil from the general oil entry was read as clarificatory of the legislative scheme. The inclusive wording in the cosmetic entry was understood exhaustively, confirming that the higher-rated category applied.

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Issues: Whether perfumed hair-oil fell within the entry for cosmetics and toilet requisites taxable at 10 per cent, or within the entry for oils of all kinds taxable at 3 per cent, and consequently whether the turnover of perfumed hair-oil was taxable at 10 per cent.

Analysis: The decisive test for construing entries in sales tax notifications is the popular parlance or commercial understanding of the article. Perfumed hair-oil is understood in common usage both as an oil and as an article of personal adornment and grooming. The Court held that it squarely answers the description of cosmetics and toilet requisites because hair-oil is used not merely for grooming but also for beautifying appearance, and the addition of perfume gives it a distinct character as a cosmetic article. The Court also examined the sequence of notifications over time and found that the rate structure consistently reflected a legislative pattern of taxing luxury or semi-luxury items at a higher rate. The later notification excluding perfumed hair-oil from the general oil entry was treated as clarificatory rather than as showing a contrary earlier intention. The use of the word include in the later notification was understood as giving an exhaustive meaning to the expression cosmetics and toilet requisites.

Conclusion: Perfumed hair-oil was held to fall under cosmetics and toilet requisites and was taxable at 10 per cent. The turnover of Rs. 8,000 on perfumed hair-oil was therefore taxable at 10 per cent, in favour of the assessee on the classification issue and against the assessee on the rate challenge.

Ratio Decidendi: Where a commodity answers two possible descriptions, classification under a sales tax notification must be determined by its ordinary commercial understanding and by the legislative scheme disclosed by the notifications, and an inclusive expression may be used exhaustively to clarify that a distinct article belongs to the higher-rated class.

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