Common parlance test for sales tax classification bars exemption for cotton pillow cases and limits reassessment power.

Cotton pillow cases were held to fall outside both "cotton fabrics" and "cotton garments" for sales tax purposes: applying the common parlance and commercial identity tests, the court noted that pillow cases are distinct marketable goods with their own use and do not cover any part of the human body, so the claimed exemption was unavailable. On reassessment, section 14(4)(cc) could not be used merely because the authority later changed its view; the provision applies only where exemption was wrongly allowed on the facts and law as they then stood. Notices based only on a change of opinion were therefore unsustainable.

---

---

Issues: (i) Whether cotton pillow cases are "cotton fabrics" exempt from tax under item 5 of the Fourth Schedule to the Andhra Pradesh General Sales Tax Act, or "cotton garments" under item 87 of the First Schedule; (ii) Whether section 14(4)(cc) could be invoked to reopen assessments for years 1976-77 and 1977-78 on the basis of the show cause notices issued after the amendment came into force.

Issue (i): Whether cotton pillow cases are "cotton fabrics" exempt from tax under item 5 of the Fourth Schedule to the Andhra Pradesh General Sales Tax Act, or "cotton garments" under item 87 of the First Schedule.

Analysis: The expression "cotton fabrics" was required to be understood in its ordinary commercial sense. Cotton fabric means cotton cloth, and not a distinct article made by cutting and stitching cloth into a different shape for a specific use. Pillow cases are identifiable marketable commodities with a distinct commercial identity and definite use of their own. On the common parlance test, they are not regarded as cotton fabric. They are also not garments, because they do not cover any part of the human body.

Conclusion: Cotton pillow cases are neither cotton fabrics nor cotton garments, and the turnover relating to their sale is not exempt from tax.

Issue (ii): Whether section 14(4)(cc) could be invoked to reopen assessments for years 1976-77 and 1977-78 on the basis of the show cause notices issued after the amendment came into force.

Analysis: The revisional power under section 14(4)(cc) attaches to the assessment order and not merely to the assessment year to which the turnover relates. Therefore, an assessment order made after the provision came into force could, in principle, be acted upon under that clause. However, the provision does not authorise reopening merely because the assessing authority later changes its opinion on the nature of the goods. It applies only where the exemption was wrongly allowed on the facts and law as they stood before the assessing authority.

Conclusion: The notices under section 14(4)(cc) could not be sustained, because the proposed reopening was based only on a change of opinion and not on a wrongful grant of exemption.

Final Conclusion: The writ petitions challenging the reassessment notices succeeded, while the writ petitions claiming tax exemption on sales of pillow cases failed.

Ratio Decidendi: Classification for sales tax purposes is governed by the common parlance and commercial identity of the goods, and a reassessment provision cannot be used merely to reverse an earlier view without a wrongful allowance of exemption on the existing facts.

---